LUSIONS
SECRET
A STUDY
OPPICTATO
ANNEX
POLICY IN HONG KONG IN THE LON
Kritish Internata
(a) It coste us nothing to maintain our position in
Hong Kong (apart from our present not expenditure on defence of
the order of £15 million), We have a sizeable investment in the
Colony and a considerable trade with it. It has accumulated large
sterling balanges which it is in H.M.G.'s intercst to retain,
(b) we derive considerable advantages from Hong Kong as a
centre of communications and for intelligence operations, and
politically it has some value to up in our relations with our
allies, particularly the Americane
(c) But the economy is vulnerable both to commercial policy
changes in the free world and to Chinese pressures, If it
suffered a period of prolonged economic recession or stagnation,
the Colony could become a major liability. Internal pressures and
outside criticien may build og because constitutional advanco is
inhibited. Our position in Hong Kong is a point of friction in
oup relatione with China, And we are obliged to maintain a
garrison there which would be at serious risk in the event of a
Chinese take-overw
Tritish responsibilities
(d) We have responsibilities to safeguard the welfare and
interests of about half the population of Hong Kong (i.e. to about
2 million, nearly all Chinese), We have a special responsibility
to some 100,000
:
200,000 Chinese who would be particularly
vulnerable to Chinese retaliation or to whom we ove a particular
/debt
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