CONFIDENTIAL

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5.

d. A deliberate attack by the Chinese Armed Forces.

In

the present climate of mutual self interest the likelihood

of this is remote.

Against the background of these threats there are clearly

three important and valid roles for British forces in Hong Kong:

to demonstrate that Britain intends to maintain the status quo;

to support the civil power in internal security operations and

to prevent incursion along the border. A fourth role to resist

attack is fortunately unlikely to be tested in the near future.

Progress of consultations

6.

Im

The Hong Kong Government have been given details of the

proposed reductions and the resultant costs.

Discussions continue

of the relative contributions by UK and Hong Kong; there is still

a large gap between the contribution which UK would like Hong

Kong to make and the amount which Hong Kong claims to be able to

afford. The Governor would prefer to examine a number of options

in the coming weeks and to present final proposals in May.

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