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I.
CONCLUSIONS
British Interests (Paragraphs 3-19)
(a)
Our present net annual expenditure on defence in Hong Kong is of the order of £15 million rising to an estimated £20 million after 1971 (assuming no change in the rate of the Colony's defence contribution). There are no other costs
involved in maintaining our position there, and we have a sizeable investment in the Colony and
a considerable trade with it. It has accumulated
large sterling balances which it is in H.M.G.'s
interest to retain.
(b) We derive considerable advantages from Hong Kong
(c)
and politically it has some value to us in our relations with our allies, particularly
the Americans.
•
But the economy is vulnerable both to commercial policy changes in the free world and to Chinuse pressures. If it suffered a period of prolonged economic recession or stagnation, the Colony could become a major liability. Internal pressures and outsido criticism may build up because constitutional advance is inhibited. Our position in Hong Kong is a point of friction in our relations with China, And we are obliged to
maintain a garrison there which would be at
serious risk in the event of a Chinese take-over.
British Responsibilities (Paragraphs 20-27)
(a) We have a general responsibility to safeguard the
welfare and interests of the population of Hong Kong and a particular responsibility to about half the population who are British subjects (1.e. to some 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
owe a particular debt because of their connection
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