CONFIDENTIAL **

(a)

(e)

4

Over the past two days the public were beginning to fee. anxious to see an early settlement of the issue. Their anxiety stemmed largely from the fear of political tension developing over this issue which had the making of a nasty problem going beyond a normal labour dispute. There was no evidence that the public were viewing this as an issue involving racial tension. However, many people thought that it was unwise for the Royal Hong Kong Jockey Club to employ an expatriate lady to handle the difficult problem of personnel management involving complicated negotiations with labour groups such as mafoos.

(f) Many others thought that the mafoos were not very well

paid and generally deserved better treatment, taking into consideration the importance of their services and the resulting damage caused by industrial action.

HAD staff are keeping an eye on how this situation develops.

CONFIDENTIAL #

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