1

SECRET

December.

settled:

There were however a number of points still to be

2.

a.

The form of the Confidential Heads of Agreement.

The Minister of State considered it essential to initial

something before he left embodying a joint understanding of the position reached.

b. The content of the public announcement to be made on his departure. He considered it an inescapable requirement that an agreement on the size of the garrison must be spelt out in order to avoid further difficulties

on his return to the UK. It should also include a form of words reaffirming Britain's commitment to Hong Kong. Beyond that the statement should be a short and formal indication of where things stood saying that there was as yet no final agreement on cost sharing. He preferred to avoid the introduction of any figures. In addition he would also want to make a short personal statement to be cleared beforehand with the Governor.

The Minister presented a revised version of the joint

statement for further consideration. The Governor offered an

alternative form of the exchange of letters. Each side agreed to examine these documents and confer again shortly.

3.

Commenting on the Minister of State's press proposals, the Governor said that it might be worth mentioning the total figure which had been brought down a very long way from the original figure of $700M. Other points on which the Minister might be questioned would be land, inflation and how far apart the two sides really were. On the latter it would obviously be necessary to remain as vague as possible. The Minister said that he preferred a very bald official statement.

The purpose

SESECKET

/of

!

Share This Page