SIPANO/CVL
4
Reference.
SECRET
HKB 063/1
ROYAL NAVAL PRESENCE AFLOAT IN HONG KONG
1.
257,
Your minute of 21 January refers. I have done a background brief, for the visit and we have telegraphed Hong Kong asking for details of incursions, deskby 23 January. In theory therefore it should be possible to submit before Lord Caithness goes to Hong Kong but I am not sure this would be the best option.
2. Hong Kong's case is not strong in the current climate. While in principle I am sure that Hong Kong are right to argue that the existing DLA arrangements should be followed (and that we should support them). MOD are currently in a very strong position to and in NC mood to play soft. Further, I cannot see OD(K), where this subject will
doubtless end, siding with Hong Kong when "our boys" are dying in the Gulf; when the MOD budget is stretched to the limit; and when Hong Kong are unenthusiastic about making any contribution to the Gulf effort.
3.
I suggest that it would be best for Lord Caithness to discuss this issue and a Gulf contribution in some detail first with the Governor. He could then form a first hand opinion of the difficulties in Hong Kong and weigh those up with the difficulties here. He might judge that it were best to tell Hong Kong that in all the circumstances they would have to pay.
4. The funds involved, for either side, are peanuts and I believe that the outbreak of hostilities in the Gulf has titled the political balance significantly towards the MOD: unless Hong Kong were to make a good contribution towards the Gulf. That would probably cost them a lot more than the £7.5 million needed to fund the MOD's 35% share up to 1997.
CODE 18-77
22 January 1991
SECRET
Mill Ustere.
M V Stone
Hong Kong Department