י
CONFIDENTIAL
run the risk of reopening the whole argument over defence costs which, although dormant, remains potentially controversial in Hong Kong. I cannot accept that it would make sense for HMG to run these risks, at a crucial
stage of the transition, in the hope of saving part of
our share of the costs of running the patrol craft over 5
years. However, despite these pressures the Hong Kong Government recognise the severe financial constraints on
the MOD budget and would be willing to accept a reduction from three to two in the number of patrol craft based in
Hong Kong.
7.
As in the case of the Falklands, I would be more
inclined if necessary to look elsewhere in Hong Kong for savings possibly through further economies in the running of the garrison, for example, by reductions in personnel or equipment, such as helicopters.
8.
G
We should keep the west Indies Guardship.
9. The other out of area commitment which involves
substantial extra expenditure is the Belize Garrison. Our objective has long been to withdraw the garrison,
preferably sooner rather than later. But we have been
concerned not to withdraw in circumstances which would
undermine the prospects for a settlement between Belize and Guatemala. We hope that the new government of Guatemala will accept the draft settlement negotiated by its predecessor with Belize. I hope that it will be possible to bring about the withdrawal of the garrison and its replacement by a rapid reinforcement plan, provided that the latter could be demonstrated through
periodic exercises. The departure of the garrison in
/advance