TNAG-0060-FCO40-96-Strength-of-Hong-Kong-garrison-1968 — Page 101

UK EYES ONLY

SECRET

ANNEX A to DP 9/68 (Final Continued)

b. In the event of a decision to take over Hong Kong, China is likely to use methods other than direct aggression, such as a co-ordinated and systematic campaign of terrorism, aime at undermining public confidence and at disrupting the machinery of government and the economy to an extent that would make the British position untenable. There is at present no sign that such a course will be pursued, but there will continue to be a risk of action on these lines. We are likely

to get at least some warning of such a systematic sampaign.

C.

In other circumstances little or no warning might be available, and even comparatively minor incidents in the densely populated areas are liable to grow rapidly

into major riots in which mass excitement and unrest can spread quickly. The local communists would exploit such disturbances and, if they succeeded in gaining wider support from the mass of the population, the disturbances

could well be considerable.

ã•

If, during the next few years, confrontation was

again raised to the level reached during the summer of 1967 and was maintained for a prolonged period, it could

have a very severe effect on the economy and the confidence on which Hong Kong's viability depends. On the assumption that China would not be intending

to make the British position wholly untenable, she would try to ensure that such a campaign was regulated so as to avoid the disadvantages to herself attendant on serious economic decline or collapse.

e.

Nevertheless, a policy of moderation could quickly be reversed, particularly if the Cultural Revolution flared up again with a resurgence of extremism, although at present this seems unlikely, But if it did, it could

create a heightened danger of direct action against Hong Kong either deliberately, or by miscalculation. The danger of action by the Chinese aimed at taking over

shoed

Hong Kong might increase as the economic importance of Hong Kong to China declined.

A 2

SECRET

UK EYES ONLY