CO537-3703 — Page 12

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Mr. Sidebotham.

With reference to telegram No. 1106 Secret from Hong Kong about constitutional changes, the Secretary of State has commented that he and Lord Listowel must watch the constitutional problem very carefully because of a) the possible deterioration of the political situation which might result from communist victories in China, and b) the reaction of the Commonwealth Affairs Committee recently to the constitutional problem in Gibraltar. The latter is now somewhat relevant to the situation in Hong Kong where the creation of the municipality has been long delayed and apparently may now have to be abandoned.

You will no doubt see that the papers come forward at an appropriate stage. I am sending a copy of this minute to Mr. Mathieson.

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