Mm. Houre
Obs pl
Hugs
CONFIDENTIAL
020/1
KFX Burns Esq
SEAD
FOO
Any
cbs?
ние orill
AD.
12/12
35
М. Местой 1 Miss Barnsley
BRITISH EMBASSY
JAKARTA
8 November 1982
Understandable
but all
biti firmative, !.
Dear Kevin
KJM
HONG KONG
1.
W. Donald
HKGD
3.6.
Mr. Durning (DOT)
22/11
See (41)
In my telegram No 298 of 11 October I suggested that the forthcoming Ambassador ial conference in December in Bangkok might pay some attention to the possible role of our South East Asian Embassies in the develop ing Hong Kong drama. As I mentioned, there has been a marked absence of official Indonesian comment on the results of the Prime Minister's visit to Peking and Hong Kong. This partly reflects Indonesian ignorance of the subject, and perhaps an ignorance of whether Indonesia will in fact be in any way affected. One or two officials have asked how we see the outcome of a very difficult negotiation. Privately same rich Chinese in conversation have expressed concern about the future of Hong Kong, and clearly expect an eventual Chinese takeover. A clearer line emerged when the President of the Indonesian Chamber of Commerce on 23 October said that 'Hong Kong's return to the jurisdiction of the CPR in 1997 will greatly benefit Indonesia because of the likelihood of Hong Kong investors direct ing their capital from the former British colony to Indonesia.
2. It is not perhaps irrelevant to my theme that the Indonesians seem to us to have been quite helpful to us over Brunei. They responded quickly to our suggestion of a visit here by the Brunei Speaker and the Foreign Minister, Mochtar, visited Brunei after the last ASEAN meeting, and gave encouragement to the Sultan on his route to independence. If the Indonesians see something as clearly in their own interests, as in this case, they can be expected to be positively helpful.
3. And the linkage with Hong Kong is far stronger than that with Brunei. Hong Kong is an important factor in Indonesian external trade. It is the second largest investor in Indonesia, the Japanese being the first: the latest Indonesian figures - from 1980 · indicate that the Hong Kong interest is about US$1,000 million placed in this country. Tradewise Indonesia imports US$139 million from Hong Kong and exports to Hong Kong US$152 million. This trade has shown substantial growth over the last ten years. The Embassy issues around 14,500 visas per year for Indonesians wishing to go to Hong Kong and we believe that around 35,000 Hong Kong citizens come down to Indonesia each year. The Indonesians have a Consulate General in Hong Kong, and since they have no diplomatic relations with Peking, some official dealings with the CPR take place via Hong Kong. Their security and intel- ligence organisations continue to demonstrate a close interest in former PKI members now living in Hong Kong and are prepared to overlook the ir non- aligned stance in order to exchange views with those responsible for counter- subversion in the Colony. So, one way and another, Hong Kong is quite a substantial entity on the Indonesian horizon. When it comes to statistics the Indonesians treat it separately. Their jealousy of Singapore's entre- preneurial activities does not seem to extend to Hong Kong.
4./
CONFIDENTIAL