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4.

The Governor has made it quite clear:

(i) that he sees no prospect whatever of

securing agreement in Hong Kong to a

(ii)

settlement of this issue on the basis of

the terms that Ministers have instructed

him to put to his Government.

that in his view the only way in which

HMG will secure those terms will be by

imposing them jupon the Colony by use of

the reserved powers under the Hong Kong

Constitution.

5. Despite the Governor's views on this matter it

would be out of the question for the Secretary of

the

State to report back to Defence and Overseaf Policy

Committee until action on their previous decision

had been carried out. And it is not at all clear

from the Governor's telegrams that this has been done.

6. In the circumstances I see no alternative to

sending a further telegram to the Governor along

the lines of the attached draft,

been agreed at the official level with the

The draft has

Treasury, the Ministry of Defence and the

Department of the Environment.

(which you

In few earlie in a slight diffuer ļ digjumr

fum).

2

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