CO537-2187 — Page 202

XTRACT FROM OFFICIAL REPORT OF.

23-1-47

(House

of Lorch)

81

54145/07 (M.5.2514)

Lord

Derwent,

The three spheres in which it seems to me our potential utility still exists are the

cultural, the political and the economic. One aspect of the economic side was very ably dealt with by the noble Lord, Lord Teviot, and I had great pleasure in listen- ing to his remarks. It is with one particular place that I wish to deal. seems to me sometimes to be forgotten that we still have a perfectly legal foot- hold in China in a place where our record has, in many respects, been a good one; a place which does not for the moment

wish to be returned to its native country, although I imagine that that issue cannot be indefinitely evaded. I refer to Hong Kong. Hong Kong is, as a Times corre- spondent recently put it, the shop window of Britain in China," and our be- haviour there can do very much to influ- ence the effect of British policy on a larger stage. The first step there, after consulta- tion with the Allies, should doubtless be to determine the future status of the place itself. We could then probably build up a competent and progressive administration (which does not exist at this moment) which could make proper contacts with Nanking and instal labour experts, as we have done elsewhere--and very rightly- to assist the Chinese workers to form their necessary labour organizations.

"