SECRET

Mr Male

Par

4/x

Sir Duncan Watsen

PS/Lord Goronwy Roberts

Mr. Male.

HONG KONG DEFENCE COSTS NEGOTIATIONS

iu. Jaanvrin

M. Mleta

7

Telu

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1. There appears to have been something of a breakthrough in the negotiations at the end of last week (my submission of 31 October 345 refers).

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2.

I attach copies of four telegrams which Mr Rodgers's party sent

to the MOD over the weekend reporting the outcome of the negotiations. These telegrams are as follows:-

248)

342

146

lag E

349

3.

(i)

(ii)

A personal message from Mr Rodgers to the Defence Secretary

reporting on the conclusion of the negotiations.

The text of Heads of Agreement initialled on 1 November

by Mr Rodgers and the Governor of Hong Kong.

(iii) The text of an agreed joint statement released in Hong Kong

on 1 November (a copy of this has been sent to News Department

but, as agreed prior to Mr Rodgers's visit, it is for the MOD to deal with press enquiries). This telegram also contains the text of comments made by Mr Rodgers in expan---

sion of the press statement.

(iv) The text of a Question and Answer Brief for use by Mr Rodgers

at a press conference on 1 November. It is not clear to me how this relates to Mr Rodgers's comments contained in (iii).

Mr Rodgers will, no doubt, be reporting personally to the Defence Secretary and the MOD will be assessing the outcome of the negotiations”. Mr O'Keeffe, who was involved in the negotiations, is due to return to London thisrafternoon. I do not think therefore

that I should attempt any considered analysis of what has happened. It should, however, be noted that a number of points remain to be

resolved. As I see it the main ones are as follows:-

SECRET

/(a) A joint

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