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67/2
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HONG KONG: CONTINGENCY PLANNING FOR AN
EVACUATION
Introduction and Summary
FINANCIAL AND ECONOMIC
We were asked (paragraph 21 of K(67)2) to consider
what immediate action would need to be taken on financial
and economic matters in the event of a forced evacuation
from Hong Kong.
2. In summary our conclusions on immediate action
necessary in the context of an evacuation are as follows:
(1) There would be no possibility of protecting U.K.
property in the form of fixed physical assets
such as buildings (paragraphs 4 to 6 below).
(2) It would be necessary to block the substantial
sterling balances held by the Government and
residents, chiefly banks, of Hong Kong. This
could be done within 24 hours (paragraphs 7 to
10 below).
(3) We would need subsequently to establish criteria
under which sums might be released from the
blocked balances, but it is netther necessary nor practicable to determine these criteria in
advance (paragraph 11 below).
(4) There would be no need for immediate action on
the commercial policy front in the context of an evacuation, but action would probably be needed within a few weeks (paragraph 13 below).
3. While we were not specifically asked to do so, we thought it desirable to deal also and briefly with a situation in which there were no evacuation but continued disturbances. In these circumstances there would be danger
of capital flight (and of other serious and potentially costly economic and administrative problems) arising from a
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