CONFIDENTIAL
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6.
As the Annex indicates no significant changes
in our defence deployments outside NATO are
envisgaged as a result of the Options for Change
review. There are however several outstanding
issues over which we and MOD have a conflict of
interests which have been given added impetus by
the review. The most contentious issues for the
FCO relate to specific changes proposed by the MOD
recation
in addition to Hong Kong (Serial 2 in the Annex)
and the Falklands/British Antarctic Territory
(Serial 1). We also have serious reservations
about possible changes in relation to Belize
(Serial 3) and our related commitments in the
Caribbean (Serial 11). These are dealt with
below in paragraphs 14 26.
7. On Gibraltar (Serial 4) there are two main
Concerns
FCO queries over future MOD reductions:
the potential difficulty of convincing
Gibraltarians, the UK Gibraltar "lobby" and
the Spaniards that such cutbacks are an
operational matter and do not represent any
reduction in our commitment to Gibraltar;
the economic impact on the territory;
2-3 years.
Significant cutbacks seem inevitable over the next
It will be important for the MOD and
FCO to keep in close consultation. The Gibraltar
Government are reconciled to further cuts and have
embarked on a vigorous policy of diversification
financial
based on tourism and practical services. They
have so far been remarkably successful in