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4.
rules and restrictions as those obtaining at
present for China (without Hong Kong) and that
therefore
existing trade with Hong Kong would not/to any
extent be replaced by increased trade with
China; (see paragraph 13);
(3) that Hong Kong's sterling balances would be
blocked and rolcasos would be made from them
only to selected claimants resident outside the
enlarged China;
(4) that China would take over U.I. property in
Hong Kong (which may be worth about 280 million)
and there would be no compensation.
In Section II an attempt is made to xkEXA
the
*eatxixe asses/ potential effects on the U.K. economy of possible developments, accompanying (or consequential on) the loss of Hong Kong, in our economic
relations with China, In particular account is taken of
possible policy action by either the U.E. or China which
would call for modification of the assumptions in
paragraph 3.
I.
"
5.
ffects on the U.Z. economy (from loss of econonia relations with Hong Kong only)
The U.K. balance of payments on current account with
Hong Kong in 1966 was approximately as follows:
3 million
(a) UK. Exporto + 66¢
(a) Imports
729
(D) IPD
+ 10
(e) U.K. Forces
10
(c) Other
(f) Earnings on
(incomplete) • 5
Hong Kong sterl-
ing balancos
15
Total Credits
Balance
Total Debits
97
16
*U.K. figures, with an arbitrary deduction in the case of
imports to discount carriage insurance and freight earnings from which are disregarded because no detailcā information is available as to how they accrue to the UK.
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