SECRET
5.
The Working Party, set up to examine (a) above, which is the most difficult issue, has reported that it will be feasible for the areas of Kai Tak and Victoria Barracks to be handed back to the Hong Kong Government by the dates required under the Heads of Agreement i.e. within two years of the new agreement coming into operation. On (b), the duration of the agreement, the Secretary of State proposed an agreement of no stated duration but including provision to the effect that after seven years either side had the option of seeking amendment to it on giving one year's notice' of a wish to do so. It has since been agreed among HIOD, FCO and Treasury officials that the Defence Secretary should be advised to suggest to OPD colleagues that provided other aspects of the agree- ment can be satisfactorily resolved, it should run for a period of seven years in the first instance and that it should be renewable on the same terms for periods of five years thereafter unless either government gives the other notice a year before the end of each such
The Secretary of state period that it wishes to vary the terms. for Defence has circulated this formula to his OFD colleagues for approval. It fully meets the FCO's position. However, the position on this should not be revealed in detail since Mr Rodgers may well need to keep this card close to his chest until it is clear that agreement on the other matters is in sight. The outstanding points at (c), (d) and (e) above have been the subject of exchanges of telegrams between Hong Kong and ourselves but as yet remain unresolved.
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6.
Unofficials in Hong Kong, who have been briefed on tho results of the Working Farty's report on the release of defence lands, have urged that the Governor must be seen to be continuing the "struggle" on Hong Kong's behalf when he is in London and that
This would very he should be accompanied by senior officials. probably have been unacceptable to lir Rodgers but a compromise has been worked out whereby the officials will come next week to try to sort out the remaining points with CD officials in the hope that the two principals can meet on Thursday in the knowledge that the
The Governor has details have been satisfactorily settled.
This is welcome to the
telegraphed accordingly to Hong Kong asking that any press announcement of the visit should be low key. Ministry of Defence.
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17.