CO537-4825 — Page 32

*

Mr. J.C. MORGAN

DRAFT

(Copy on 94001/28)

Original at No 38 ow

94001/18/48

10

Note of meeting held in Mr. Rees-Williams

room at 3.30 p.m. on 20th December, 1948, to

discuss situation in Hong Kong and Far East

generally.

Present:- Mr. Rees-Williams (in the Chair)

Sir Thomas Lloyd

1.

Sir Charles Jeffries

Mr. Paskin

Mr. Sidebotham

Mr. Trafford Smith

Mr. Higham

Mr. W.I.J. Wallace

Mr. Morgan.

Attention was drawn to the present stage

of H.M.G's policy in China as revealed in the

recent Cabinet minutes: this policy was

largely a matter of foreign affairs although

it had anstraining impact on Hong Kong and the

Far Eastern dependencies. For the present the

Colonial Office at least can only "wait ar

see" the trend of events in China.

2.

One important question was whether if

when the Communists at up administration

should

Nanking we

maintain

when

with them

British agent

the Ambassador moves wit

the Kuomintang Government to Canton. The

policy is that "de facto" recognition will

to be given to the Communists. This reinfor

the Government decision that the Governor

Hong Kong must continue to maintain a polic

strict neutrality as between the Communistee

Kuomintang. On the other hand this policy

can only remain valid while there remains in

China a balance between Kuomintang and Com

in making plans we have to consider the won

case viz: complete Communist domination such

as well as north of the Yangtze River.