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CONFIDENTIAL

VISIT OF THE SECRETARY OF STATE TO HONG KONG : 29-31 May 1988

BRIEF NO 11 : DEFENCE COSTS AGREEMENT (DCA)

CHECKLIST OF POINTS TO MAKE

[With Governor] Concerned negotiations are dragging on. MOD

believe issues raised on your side go beyond agreed parameters.

Hope new agreement can be quickly finalised, and within agreed apportionment of costs. Ministers will not go further.

Interest of both sides lies in speedy conclusion.

round can be the last.

Hope next

[With ExCo]

Difficult for you. But we too have had greatest difficulty in

adjusting apportionment in Hong Kong's favour.

Hope concluded agreement can now quickly be put to LegCo

Finance Committee with your support.

[General use]

We have basis for new apportionment of costs. Details now need

to be finalised.

CONFIDENTIAL

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