}
HONG KONG DEFENCE COSTS NEGOTIATIONS
JOINT PRESS STATEMENT
349F
During the past week, negotiations have taken place
between delegations of Her Majesty's Government headed by the
Rt. Hon. William Rodgers, M.P., Minister of State for Defence,
and the Hong Kong Government headed by the Governor, Sir Murray
MacLehose. These negotiations followed exchanges which have taken
place during the last year on a successor agreement to the present
Defence Costs Agreement which expires on 31 March, 1976.
The negotiations were based on the clear acceptance by
both sides of the need for a garrison capable of maintaining the
security and integrity of Hong Kong and demonstrating HMG's
continuing responsibility for the Colony. Such a garrison is also
regarded by both Governments as an important factor in maintaining
confidence.
As a result of these negotiations agreement has been
reached on the size and total cost of the garrison. The future
garrison will be reduced from its present level of 6 2/3 units to
include only four infantry battalions (one of them British), a
Gurkha engineer field squadron, five Royal Navy craft and a squadron
of eight Royal Air Force Wessex helicopters. The total cost at
current prices is estimated at HK$450m (42-1/2m) a year, compared with
the cost of the present garrison of nearly HK$700m (Z65m). Hong Kong
will have to bear a substantially higher proportion of the total
cost of the garrison than in the past; but the size of the
contribution will have realistic regard to Hong Kong's ability to pay.
During the course of this week's negotiations the basis
for sharing the costs was the major point under discussion. Other
points included the release of further land at present occupied by the
garrison, the method of calculating costs and the rates of exchange