TNAG-0041-FCO40-77-Future-Sovereignty-of-Hong-Kong-Defence-Review-Working-Party-1967 — Page 138

6.

Conser

It is a valuable market for our exports, taking some

£64 million worth in 1966 (œur exports to Japan are of the same order). with Hong Kong's exports to the U.K. totalling about

£62 million, the trade in both directions is of the order of

£120 130 million anmally.

7.

It is a valuable centre of communications in the Far Best, both

for aircraft and shipping;

8.

Our positim in Hong Kong and the facilities we are able to offer there to other countries give us a long standi in the area and

a means of influencing the policies of our allies,

Chinese Attitude towards Hong Kong

China regarda liang Reng as Chinese territory to be recoverod in die coUTES, No Chinese Government is likely to agree to a roneval

of the lease of the New Territories in 1997; and retum of the Her Territories (without which the remainder of the Colony omld hardly be viable) is certain to be accompanied by a demand for return of the ceded areas. Two factors operate at the present time against a premature

Chinese move to recover Hong Kong.

10. There are no military understandings between us and the Americans over Hong Kong. Nevertheless, there is probably Chinese supposition that some such understanding does exist end, in any case, a fear that

a sove on their part against Hong Kong would provoke a strang

American reaction.

11.

The Colony is of considerable economie value to China, providing

The 1966 foreign exchange earnings of about 2200 million a year, visible trade balance in China's farour alene was £168 milliin, China

is increasingly using Heng Kong to market its exports in 3.E. Asia and the Far East; some 22% of its experts to Hong Kong of £173 million

in 1966 were recorded as having been re-exported.

12.

In these circumstances China is (in the words of officially inspired pronouncements) prepared to accept the "status quo" until the time is "ripe" to re-negotiate the "unequal tresties" which have wrested Hong Kong, Maoso and other Chinese territory from her. By

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