[NR5ANV]

CONFIDENTIAL

CALLS BY THE GOVERNOR OF HONG KONG, 14 AND 15 MAY 1986

a)

HMG's Contribution to Hong Kong Student Scheme

POINTS TO MAKE (DEFENSIVE)

1.

No final decisions yet taken on 1987/88 allocations

but Ministers looking for reductions across the board in

all country support schemes. Accept political arguments for maintaining UK contribution to the Hong Kong Scheme but

these are difficult to sustain in view of proposed cuts in

other country schemes and particularly following the

underspending of last two years.

2.

Understand that you are to discuss this matter with

the Department during your visit.

3.

(if pressed) We may be able to build

to build in a 10%

margin to be available if needed. That would bring the

Hong Kong allocation up to £1.75 million or thereabouts.

CONFIDENTIAL

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