CONFIDENTIAL
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Hong-Kong darives a good deal of revenue from UK airlines and this, it could be argued, should further reduce the sum at which we should look as a basis to, say, £6.5 m.
On this basis a possible UK contribution might be considered to be 8% of £6.5 m. = £0.52 million.
9. I must admit however that under normal circumstances we would be looking at such a contribution as a grent (we have never made loans and I am still not entirely clear that we could do so) and I am thus not at all clear what would be a loen equivalent of a grant of something like £500,000 - supposing it could be found. Indeed the word "supposing" is not unimportant for I think all of us have some feeling that, though there is a fairly strong UK interest, Hong-Kong does not really need the money (I believe the last Budget was a good one) and one begins to wonder whether the reasons for giving assistance are not more of a political, "morule", or psychological kind than ones relating solely or mainly to UK civil aviation interest.
10. This is not, I must confess, a remarkably constructive contribution to the solution of a difficult problem but it is, as I have said, the best I can do on the eve of departure and may possibly provide some food for thought.
11. Copies of this letter are being sent only to those named below.
c.o. W. S. Carter, Baq.,
(W. J. Coe)
Foreign & Commonwealth Office,
Downing Street, S.F.l.
C.C. Ricketts, Esq.,
Ministry of Overseas Development,
Eland House,
Stag Place, S.W.1.
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