CONFIDENTIAL
HKB 243/11
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051271
MDHIAN 0982
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CONFIDENTIAL
FM HONG KONG
TO IMMEDIATE FCO
TELNO 2112
OF 27120OZ JUNE 89
INFO IMMEDIATE UKMIS GENEVA
VIETNAMESE BOAT PEOPLE: FINANCE
1. THE VERY HIGH RATE OF VBP ARRIVALS DURING THE FIRST HALF OF THE YEAR HAS RESULTED IN A FAR HIGHER LEVEL OF RECURRENT EXPENDITURE THAN EXPECTED WHEN THE BUDGET ESTIMATES WERE PREPARED. THE RESULT IS THAT OUR FUNDS TO COVER THE COST OF MAINTAINING THE VBP POPULATION (IE FOOD, RELIEF ITEMS, HIRE OF FERRIES, REFUSE COLLECTION, STAFF COSTS ETC) ARE CLOSE TO EXHAUSTION. WE ESTIMATE THAT WE SHALL NEED AN ADDITIONAL HK DOLLARS 96 MILLION TO COVER THE EXPECTED LEVEL OF RECURRENT EXPENDITURE FOR THE REST OF THE FINANCIAL YEAR.
THIS ESTIMATE IS BASED ON THE PLANNING ASSUMPTION THAT THE ARRIVAL RATE FOR THE SECOND HALF OF THE CALENDAR YEAR WILL BE IN THE RANGE 15-20,000.
2. THE POLITICAL AND CONSTITUTIONAL DIFFICULTIES IN APPROACHING FINANCE COMMITTEE WITH A REQUEST FOR THESE ADDITIONAL FUNDS ARE WELL KNOWN TO YOU. MEMBERS OF FINANCE COMMITTEE CONTINUE TO WARN THAT ANY REQUEST FOR FUNDS IS UNLIKELY TO BE APPROVED AND WE THINK WE MUST THEREFORE LOOK TO ALTERNATIVE SOURCES TO COVER OUR EXPENDITURE
REQUIREMENTS.
3. WE HAVE ESTIMATED THAT FOR THE CALENDAR YEAR 1989 (UNHCR'S FINANCIAL YEAR) UNHCR'S SHARE OF THE COST OF FOOD AND RELIEF ITEMS WILL AMOUNT TO ABOUT HK DOLLARS 112 MILLION. ABOUT HK DOLLARS 30 MILLION IS NOW DUE FOR THE FIRST HALF OF THE CALENDAR YEAR. HOWEVER, UNHCR HAVE NOT YET BEEN ABLE TO CONCLUDE THE USUAL SIX MONTHLY AGREEMENT TO COVER THIS REIMBURSEMENT BECAUSE OF THEIR UNCERTAINTY OVER THEIR OWN FINANCIAL PLANNING, PENDING THE RESULTS OF THEIR CURRENT INTERNATIONAL APPEAL. WE RECOMMEND THEREFORE THAT UKMIS
GENEVA APPROACH UNHCR WITH 3 SPECIFIC PROPOSALS:
ΤΟ
I) UNHCR'S APPEAL FOR FUNDS TO COVER THEIR HONG KONG OPERATIONS SEEMS TO HAVE MET WITH A POSITIVE RESPONSE. UNHCR SHOULD THEREFORE NOW BE ABLE TO CONCLUDE TWO NEW AGREEMENTS WITH HKG ON THE USUAL BASIS, COVER RESPECTIVELY THE FIRST AND SECOND HALVES OF THE CURRENT
CALENDAR YEAR.
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