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AID FOR HONG KONG
CONFIDENTIAL
REGISTRY No. 31
- 2 FEB 1972
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1. In your minute of 26 January you asked for my views on the desirability of HMG contributing say, £200,000, for books for a new library at the Hong Kong Polytechnic.
2. At the outset, I must say that I am a little doubtful whether HMG will receive any credit for a gesture of this kind unless the proposal has the full support of the Hong Kong Government. Mr Royle will remember that after all our efforts to obtain agreement for the grant of £400,000 for technical institutes we were told not only that the money was not really wanted but that our "gesture" had raised suspicions as to our motives in the minds of Executive Councillors.
3. When Mr Haddon-Cave was here recently we touched on this question of aid and he as good as said that Hong Kong were not interested in small sums (by small sums he meant, I think, £50/100,000). He went on to talk about "co-operation" between HMG and the Hong Kong Government something to bring home to the people that Hong Kong was a British Crown Colony.
4. In my view what would do more than anything else to restore good relations with Hong Kong would be assistance from the UK towards the cost of extending the facilities at Kai Tak Airport. Apart from this, I believe that in present circumstances Hong Kong neither need nor want any large amount of capital from the United Kingdom. If a decision is taken to go ahead with the underground railway Hong Kong will undoubtedly wish to raise funds from abroad with which to finance at least part of the scheme. The Hong Kong Government have known for at least a year that we are ready to consider with them ways in which the project may be financed (provided, of course, some at least of the contracts come the way of UK firms
hat I would like to see is a co-ordinated effort by Hong Kong and the United Kingdom in this matter.
5. There is one other point. I believe that Hong Kong has suffered at least during the last three years from the fact that the Colony has been accumulating what can only be described as massive reserves. This is why Hong Kong cannot easily raise loans from abroad. In other words, I believe that Hong Wong would be better off if the territory's reserves were
smaller (I am assuming of course that some of the money now invested would have been spent on education and other social services as well as the underground railway and water supplies).
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26 January 1972
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Sir L Monson Mr Wilford
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Hong Kong Department
CONFIDENTIAL
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