CO537-3702 — Page 4

1.

Foreign Office (F3574/154/10)

Put

it by vide note on (1).

& Rat

R3

16/3.

10-3·48.

2. Hong Kong

Sir Thomas Lloyd

Tel 313 See.

18.3.48.

Reference No.2, Lord Listowel has no doubt decided that, on the whole, it would be better for him to make some reply to questions from the Press on the subject of our future intentions regarding Hong Kong, than to stall. The criterion is, of course, which of the two is likely to be the least harmful from the point of view of the uncertainties which are felt in Hong Kong concerning its future.

I suggest that Lord Listowel be

informed that there is no objection to his proposed answers on both points, but I would like to suggest to him that, in order to strengthen the reply on the first point, the words "and of no reason why they should do so" should be added and that he should consider as an alternative to the proposed reply on the second point "question will naturally be one for discussion between the two Governments".

I submit a draft reply to Lord Listowel'e message embodying the above suggestions. I have spoken to Mr. Scarlett of the Foreign Office who saw no objection personally to our replying to Lord Listowel on these lines, but the matter will, of course, have to be submitted for Ministerial consideration in the Foreign Office, and, as time is short, I have sent a copy of the draft telegram over to Mr. Scarlett, explaining that it is under submission to hither authority here.

3. To F.O. (P.W. Searlett Ssg.)

gmanla

19.3.48.

%-W/e (2) adft. reply. - 19.3.48.

Mr. Scarlett (Foreign Office) has since told me that the Foreign Office view, on the official level, is that it would be inadvisable for Lord Listowel to make any statement on the subject of the future of Hong Kong. Any such statement is bound to be distorted by the Chinese Press and if anything were said on the subject of the lease it would probably lead to the Chinese Government raising the question of its termination with H.M.G.

I have