TNAG-0032-FCO40-68-Relations-with-China-1968 — Page 8

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SECRET

GOVERNOR, HONG KONG

PEKING

Your telegram No. 1007: Grey.

We are grateful for your analysis of the

possible courses of action and for comments in

Peking telegram No. 765. The problem is indeed a

very difficult one.

While it is possible to go a

long way to agreeing with the arguments and

conclusions in your telegram under reference, we

have to consider the pressures building up here for

some action to be taken. We can expect to limit

these, if we can give a confidential assurance in

certain quarters that we are taking an initiative

to secure Grey's release.

2.

Peking's arguments in favour of unconditional

release as an act of faith are fully appreciated,

but we judge this course to be a gambler's throw

carrying risks that at the present time would be

unacceptable if it failed. Public criticism here

as well as in Hong Kong would be strongly adverse

if we released Hsueh and Lo without getting Grey

/ back.