ARRAEB (8)

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concession even of the size requested by the Governor would not

achieve the desired result; and this contribution would set a

precedent for further such requests.

However, the implication of

HMG failing to respond in an appropriate manner could be very

serious indeed. The situation facing Hong Kong is a major crisis and it would seem odd indeed if HMG did not lift a finger to help.

If Ministers were to decide to approve allocation of funds for this

purpose they would have to make clear that this was a one off payment in response to an exceptional need.

Private Secretary

ARPant

A R Paul

FROM: D H Gillmore W37 270 2156

CC:

19 April 1989 PS/Lord Glenarthur

PS/Mr Eggar PS/Mr Patten

Mr Blatherwick

Mr McLaren

Mr Thomas, SEAD

Mr Brenton, UND

Mr Ireton, ODA

Mr Crabbie, Finance Dept Mr Machin, ODA

[VIETNAMESE BOAT PEOPLE IN HONG KONG: FINANCE]

1.

I agree with Mr Paul that we face an imminent crisis and that early decisions are called for. The proposal for a £6m contribution to the Pillar Point refugee camp (which Sir D Wilson thinks would be just adequate in terms of Hong Kong attitudes) is the only option on which an immediate decision could be taken but, even then, only if ODA were prepared to allocate that sum from the balance of refugee funds (ie £6m out of the £7m remaining).

2.

The Secretary of State may wish to discuss this at his meeting tomorrow at 11.30. Mr Patten, who will see copies of these papers overnight, will be at that meeting.

Klittum

D H Gillmore

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