21st July 1967
RECEIVED IN ARCHIVES No. 31
27 JUL 1967
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CONFIDENTIAL
38
(THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT)
c 165/5(67) 3rd Meeting
CABINET
14
COPY NO.
RECEIVED IN ARCHIVES No. 31
† 27 JUL 1967
Fe 1/3
DEFENCE AND OVERSEA POLICY (OFFICIAL) COMMITTEE
DEFENCE REVIEW WORKING PARTY
MEETING to be held in Conference Room 'A', Cabinet Office, Whitehall,
S.W.1, on THURSDAY, 20th JULY 1967 at 4.00 p.m.
AGENDUM:
32
HONG KONG
(Previous Reference: C 165/5(67) 2nd Meeting Minutes)
Note by the Secretaries
(C 165/5(67) 2 to be circulated)
-
39
(Signed) R.L.L. FACER
M.J. MORIARTY
Cabinet Office, S.W.1.
19th July 1967
The following are invited to attend or to be represented:
Mr. E. Bolland, Foreign Office
Mr. W.S. Carter, Commonwealth Office Mr. M.S. Morris, Board of Trade
CONFIDENTIAL
84 (1625)
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37
FL1/3
SEE ANNEX
必
M
2
Mr. Bolland
SECRET
Hong Kong
RECEIVED IN ARCHIVES No. 31 27 JUL 1967
FD1/3
The Foreign Secretary held a meeting this morning to discuss the
situation in Hong Kong. Those present included the Commonwealth
Secretary, Mrs. Hart and Sir Arthur Galsworthy; Mr. W. Rodgers, Sir Paul
Gore-Booth,
Sir D. Greenhill, Mr. de la Mare and yourself; Sir D. White and other
officials.
36
The
2. The Foreign Secretary opened the meeting by asking what was the aim
of the Chinese in Hong Kong. Was Peking directing the disturbances? Was
Peking even involved? The Commonwealth Secretary said that the local
communists were directly responsible for the disturbances in Hong Kong
and the recent frontier incident. It seemed likely that while Peking was
giving full moral support to the Hong Kong communists they regarded them
as conducting an operation of their own. The Commonwealth Secretary went
on to analyse in detail the organisation of the communists in Hong Kong.
The tougher measures now being taken by the Hong Kong authorities had
raised the morale of the people in the Colony and seriously weakened
that of the comunists. water situation was worrying but contingency
plans were being made and, even if Chină did not turn on the taps on 1
October, we could manage until next year when the Plover Cove scheme
would be in operation. Sir Dick White agreed generally with the
Commonwealth Secretary. thought that Peking was encouraging the
long-term build-up of a mass revolutionary movement in Hong Kon. They
were not preparing for direct intervention. But in certain circumstances
they might be prepared to intervene. Peking's ultimate aim was to create
a Macao-type situation
Mrs. Hart pointed out that if in they could not control events in Hong
Kong, the Peking Government might get out on a limb. One of the dangers
was that the present disturbances
ক
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paled27/7
He
/in Hong Kong
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in Hong Kong might produce consequences which no-one could predict.
3. In subsequent discussion it was pointed out that the situation in
China was very fluid and it could not be ruled out that it might develop
in a way favourable to our position in Hong Kong. If we held on we might
eventually be able to negotiate our withdrawal. For example, if the
influence of the central government were weakened the authorities in
Kwantung might adopt more reasonable policies towards Hong Kong.
4. The Foreign Secretary then said that he understood that if we left
Hong Kong the Chinese would lose £200 million in foreign exchange. He
asked what we would lose.
Mrs. Hart replied that there would probably not be much difference
between our gains and our losses. There was not a great deal of British
investment in Hong Kong. But British banks had a big stake and Hong Kong
provided facilities for intelligence activities. Sir Arthur Galsworthy
pointed out that Hong Kong more or less paid for itself. The only charge
on H.M.G. was the cost of our troops and Hong Kong was now contributing
£5 million a year to this. He went on to say, however, that if Hong
Kong's economy turned down the cost to us could be very severe. If
foreigh demand for Hong Kong's exports fell there would be unemployment
and the cost to the British Exchequer in relief would be formidable.
5. Sir Paul Gore-Booth said an important factor in the situation was the
degree to which Peking could allow the local communists in Hong Kong to
suffer a defeat. Peking might eventually decide to accept the loss of
face involved in accepting a setback in Hong Kong and lay off for a year
or two. Sir D. Greenhill said that on the other hand the Chinese
Communist Party might need a success in 1967 as a counter to the play
the Russians would make with the 50th anniversary of the Revolution. The
kind of success they
/needed
SECRET
SECRET
needed might be creating a Macao-type situation in Hong Kong.
6. Mrs. Hart said that two points should be borne in mind. First, it
would be foolish for us to base our plans for Hong Kong on optimistic
assumptions. Secondly, we should recognise that as a result of
disturbances over the past few months confidence in Hong Kong's economy
was already declining. Unless the growth rate was maintained at about 8
per cent per annum the economy would decline and we should be faced with
unemployment. Once this began the situation would deteriorate.
7. The Foreign Secretary said it seemed likely that October would be the
danger point this year.
8. Mr. Bolland said that the Hong Kong Working Party had reached the
provisional conclusion that if we had to decide between accepting a
Macao-type situation and withdrawal we should choose the latter. Sir
Arthur Galsworthy said that if it bacame known that we intended to
withdraw the morale of the police would collapse. This ruled out
withdrawal from Hong Kong over a long period. Hong Kong's relations with
Peking had been at their best when there had been a strong Cuinese
Government. The time to start to extricate ourselves would be when our
relations with Peking improved.
9. The Foreign Secretary summed up by saying that it should be our aim
to look for developments in China which would provide a convenient
moment to withdraw from Hong Kong in good order. In present
circumstances, however, we could not plan actively to do anything except
to hang on.
c.c. P.S. to Commonwealth Secretary
==
H
Mrs. Hart
Mr. Rodgers P.U.S. (F.0.)
Sir A. Galsworthy Sir D. Greenhill (2) Mr. de la Mare
Mr. Carter (0.0.) Planning Staff
The
(D. J. D. Maitland) Private Secretary
19 July, 1967
SECRET
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8. Mr Caster C.o.
Hong Kong
The Foreign Secretary held a
meeting this morning to discuss the
situation in Hong Kong. Those present
included the Commonwealth Secretary,
Mrs. Hart and Sir Arthur Galsworthy;
Mr. W. Rodgers, Sir Paul Gore-Booth,
Sir D. Greenhill, Mr. de la Mare
Sir D. White and other
and yourself;
officials.
2.
The Foreign Secretary opened the
meeting by asking what was the aim
of the Chinese in Hong Kong. Was
Peking directing the disturbances?
Was Peking even involved? The
Commonwealth Secretary said that. that
Here was no evidence that Peking wae directly involved and It seemed
likely that while Peking was giving
full moral support to the Hong Kong
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communists they regarded them as
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went on to analyse in detail the
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in Hong Kong might produce
consequences which no-one could
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in China was very fluid and it
could not be ruled out that it
might develop in a way favourable
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we held out for the time being we
might eventually be able to
negotiate our withdrawal. For
example, if the influence of the
central government were weakened
the authorities in Kwantung might
adopt more reasonable policies
towards Hong Kong.
4.
The Foreign Secretary then
said that he understood that if
we left Hong Kong the Chinese
£200
would lose two hundred million
pounds in foreign exchange. He
asked what we would lose.
Mrs. Hart replied that there would
probably not be much difference
between our gains and our losses.
There was not a great deal of
British investment in Hong Kong. But
British banks had a big stake and
Hong Kong provided facilities for
intelligence activities. Sir
Arthur Galsworthy pointed out that
Hong Kong more or less paid for
itself. The only charge on H.M.G.
was the cost of our troops and
Hong Kong was now contributing
£5 million a year to this. He went
SECRET
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-
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on to say, however, that if Hong
Kong's economy turned down the
cost to us could be very severe.
If foreign demand for Hong Kong's
exports fell there would be
unemployment and the cost to the
British Exchequer in relief would
be formidable.
5. Sir Paul Gore-Booth said an
important factor in the situation
was the degree to which Peking
could allow the local communists
in Hong Kong to suffer a defeat.
Peking might eventually decide to
accept the loss of face involved in
A
accepting the setback in Hong.
Kong and lay off for a year or
two. Sir D. Greenhill said that
on the other hand the Chinese
Communist Party might need a
success in 1967 as a counter to the
play the Russians would make with
the 50th anniversary of the Soviet
Revolution. The kind of success
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Kong.
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6. Mrs. Hart said that two
points should be borne in mind.
First, it would be foolish for us
to base our plans for Hong Kong
on optimistic assumptions.
Secondly, we should recognise that
as a result of disturbances over the
past few months confidence in Hong
Kong's economy was already
declining. Unless the growth rate
about
was maintained at 8 per cent per
annum the economy would decline and
we should be faced with unemployment.
Once this began the situation
would deteriorate.
7. The Foreign Secretary said it
seemed likely that October would
be the danger point this year.
8.
Mr. Bolland said that the
Hong Kong Working Party had
reached the provisional conclusion
if
that/we had to decide between
A
accepting the Macao-type situation
and withdrawal we should choose the
latter.
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with Peking improved.
SECRET
6
intended to withdraw the morale of
the police would collapse. This
ruled out withdrawal from Hong Kong
over a long period.
9.
The Foreign Secretary summed up
by saying that, it should be our
developments in China which with providkę aim to look förдa convenient
moment to withdraw from Hong Kong
in good order. In present
circumstances, however, we could
not plan actively to do anything
except to hang on.
་ ༣
SECRET
хамону 975
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------
Ed (1426)
NOTHING TO BE WRITTEN IN THIS MARGIN.
Minutes.
FD1/3
34
SEE ANNEX
RESTRICTED
33
(THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT)
C 165/5 (67) 3rd Meeting
CABINET
COPY NO.
•14
DEFENCE AND OVERSEA POLICY (OFFICIAL) COMINTTEE
DEFENCE REVIEW WORKING PARTY
MEETING NOTICE
The next meeting will be held in Conference Room 'A',
Cabinet Office, Whitehall, S.W.1., on THURSDAY, 20th JULY
1967 at 4.00 p.m.
An Agenda Notice will be circulated later.
RECEIVED IN
ARCHIVES No. 31
¡ 27 JUL 1967
FD/3
Cabinet Office, 3.W.1.
17th July 1967
38
(Signed) R.L.L. FACER
M.J. MORIARTY
RESTRICTED
Ed (1636)
NOTHING TO BE WRITTEN IN THIS MARGIN.
L
ااس
Minutes.
SEE ANNEX
32
Ed (1626)
NOTHING TO BE WRITTEN IN THIS MARGIN.
Minutes.
FD1/3
SEE ANNEX
31
CONFIDENTIAL
30
(THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT )
C 165/5(67) 2nd Meeting
CABINET
14
COPY NO.
•V-D IN ENGGAMES (No. 31
27 Jul 1967
FD1/3
DEFENCE AND OVERSEA POLICY (OFFICIAL) COMMITTEE
DEFENCE REVIEW WORKING PARTY
MEETING to be held in Conference Room 'B', Cabinet Office, Whitehall,
S.W.1, on MONDAY, 17th JULY 1967 at 2.30 p.m.
AGENDUM:
HONG KONG
Note by the Commonwealth Office
(C 165/5(67 1 to be circulated)
-
31
(Signed) R.L.L. FACER
[
M.J. MORIARTY
Cabinet Office, S.W.1.
13th July 1967
The following are invited to attend:
Mr. E. Bolland, Foreign Office Mr. W.S. Carter, Commonwealth Office Mr.
M.S. Morris, Board of Trade
CONFIDENTIAL
I
RESTRICTED
į RECEIVED IN
ARCHIVES No. 3i # 27 JUL 1967
FO 1/3
29
(THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT)
C 165/5 (67) 2nd Meeting
COPY NO. 14
CABINET
DEFENCE AND OVERSEA POLICY (OFFICIAL) COMMITTEE
DEFENCE REVIEW WORKING PARTY
MEETING NOTICE
The next meeting will be held in Conference Room B*, Cabinet Office,
Whitehall, S.W.1., on MONDAY, 17th JULY 1967
at 2.30 p..
An Agenda Notice will be circulated later.
30
Cabinet Office, S.W.1.
11th July 1967
(Signed) R.L.L. FACER
M.J. MORIARTY
RESTRICTED
CONFIDENTIAL
14.7.67.