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Alan Murray XAAA2d 347 KH 215 5412

25 November 1993

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HONG KONG: BRITISH CONSULATE GENERAL BUILDING: COLOCATION WITH BRITISH CHAMBER OF COMMERCE

Your minute and attachments of 24 November refer.

We have taken a close interest in this matter and it is a pity that FCO did not show us these papers sooner. We very much take the view that the balance of advantage lies with the British Chamber colocating with the Consulate General. This would do much to enhance the image of the Consulate General as a centre of "Britishness" in Hong Kong after the handover. We have also agreed with the FCO that there is no case for the Chamber enjoying rent free status but similarly that any rent should be fair and not necessarily mirror current market rates. We would therefore very strongly support the case for the Chamber being charged the TDR rate. This, we believe, would be fair and would encourage the Chamber to colocate. OED's concerns about using the TDR for an NGO also are surely misplaced. These are special circumstances and I would be astonished if it attracted adverse criticism.

You also rightly mention the Minister for Trade's interest. I can assure you that the Minister would strongly support the line above and would, I know, be prepared to write to Alistair Goodlad at the FCO if it looked as though colocation would be lost through OED intransigence over the rent. It is worth pointing out that, although the differential between the TDR and market rates is modest in terms of the FCO's overall expenditure, it is significant for a small scale operation like the British Chamber.

Alan Murray

TOTAL P.03

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