TNAG-0103-FCO40-139-Briefs-and-background-notes-for-Lord-Shepherd-1967 — Page 32

CONFIDENTIAL

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development and the "brittleness" of Hong Kong's economy (paragraphs 3 and 4(b) of the note) it is the department's view that Hong Kong should

not be asked to make too much of an additional splash over the next few years. But the Xinister might push strongly for some additional devolopment, making the point that this would be particularly necessary in any situation of rising unowployment or of a reduced flow in investment

from overseas.

5. In this connection the Minister might urge reconsideration of:-

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(a) An Industrial Fank (paragraph 4 of Mr. Salwyn's note).

Hong Kong has hitherto regarded this as unnecessary.

But wo understand that the Banks in Hong Kong are

turning this ides over again (no doubt because of the International Bank's recommendation) and we detected

some movement in Kr. Cowperthwaite's position on this during his rocent visit. Government participation with

the Banks in an institution of this nature might provide joint financial arrangements for development which is on the borderline of Government/private enterprise responsibility in the eyes of the Hong Kong Government

.g. containerisation facilities at the port.

(D) Development Plans the Minister has himself made the

point that this would have a considerable presentational valuo. It would moan a fairly radical advance on the present five-year "Forecasts of Revenue and Expenditure",

de which are not published: the plan would be a publio

statement of the Government's intentions in the field

of capital expenditure over a period of years, with explanatory detall. Such plans (which in other Colonios have normally covered a five-year period) do not imposs

/a

CONFIDENTIAL