DECRET
obtained therefrom is irreplaceable and that withdrawal would
provide another bone of contention. Our approach to them
should therefore be exploratory. We must then be ready to
indicate ways in which we think a decision to withdraw might
be used to promote a settlement.
•
Assuming the Americans can be persuaded to agree to
our withdrawal, we should present our intention to withdraw
to the parties concerned as being conditional on a settlement
and in the context of progress towards the demilitarisation
of the island. We would suggest that, by promoting
discussion about the future of the SBAs, we hope to bring
them together for negotiations about the future of the
island as a whole.
HONG KONG
5.
The Governor has recommended that since any new
arrangements would not take effect until April 1976 (when
the present Defence Agreement expires), formal consultations
with Hong Kong's Executive Council should not start until
May 1975. He also advises that discussions on the 1975/76
Hong Kong Budget about increases to finance the enlarged
social welfare programme should be got out of the way first.
We have been in close touch with the Governor and are satisfied
that what he proposes is the best way to handle the Hong Kong
consultations.
6.
It should be possible not only to do away with the
SECRET:
/present