CO129-606-4 Hong Kong Loan- government grant 1-4-1947 - 2-3-1948 — Page 31

the basis of our proposals or something like

them, detailed Treasury control of Hong Kong

There would have to he finances should terminate. This would not

of course)

rule out an arrangement to keep the Treasury

informed of Hong Kong's financial position

until such time as it is firmly re-established.

It would, however, relieve both the Colonial

Office and the Treasury of the correspondence

and time and labour involved by the detailed

Treasury control of Hong Kong finances, and it

would, we suggest, encourage the Colony itself

to take the necessary steps to make its

financial position secure. In view of this

proposition, we are not pursuing at the moment

the question of the exact form of detailed

Treasury control referred to in Serpell's

letter of the 23rd December (IF 16/10/02).

5. I take it that there is no need [for

.wheat

or me

to set out the general arguments in favour of

a grant of financial assistance by H.M.G.

towards the territories in the Far East which

were occupied by the Japanese, at a time when

H.M.G. was in no position to carry out their

defence responsibilities towards them. These

general arguments seem to have been accepted

the case of Burma and have, I imagine, been

implicitly-accepted in the case of Malaya by

the consideration now being given to the

proposal to make a grant and an interest-free

Malaya

loan to the territory to assist in meeting

J

In view of the

Comprehensive way in which the subject is dealt with in

Grantham's denfalch, it' in perhates unnecessary

the cost of the war damage compensation scheme¿mplies at least that the...

however

Stress

To the general arguments I should like to add,

in the case of Hong Kong, the particular

considerations referred to in paragraphs 27

ud 35 of the Governor's despatch, of which

are not rejected in relation 15 the Far Eastern tear loves

Ivent