CONFIDENTIAL
On our return from Hong Kong we did our best to put this idea across to the ODM and others, but I fear we got nowhere with it.
8.
-
9. I should add that the idea of a gesture of warmth and friend- liness towards Hong Kong had for a long time prior to 1966 been a theme at which David Trench had been plugging away in my opinion quite rightly. So it was not surprising that when he came on sick leave in the summer of 1967, when life and times in Hong Kong were pretty stirring, this was one of the things for which he pleaded when he appeared before the Ministerial Committee on Hong Kong which had been set up to cope with the critical events in the Colony. But he received a pretty chilly response, particularly I believe from Mr Callaghan and Mr Healey. You may already have seen the record of that meeting.
10.
From then on we concentrated our efforts on two other projects. The first was the
the financing of the tunnel project. It was essen- tial to the maintenance of morale in Hong Kong and to the mainten- ance of investment confidence that Britain should in some concrete way demonstrate its confidence in Hong Kong's longer term future. Although Hong Kong officials, and particularly John Cowperthwaite, had always been extremely sceptical about the value of the tunnel project to Hong Kong's economy, Douggie Clague managed to convince a large body of opinion in the Colony that the tunnel was the real symbol of Britain's as well as Hong Kong's faith in the Colony's future. Once this idea had caught on in Hong Kong all efforts were then devoted to getting the finance together to enable it to go forward. At one point there was pressure on us to put up an Exchequer Loan towards the 10 or 11 millions of loan finance required. That proved impossible, but we did get the Treasury to agree to our giving a guarantee of 50 per cent of the loan capital. In the event I think it proved unnecessary to give such a guarantee, and after a lot of arguments with ECGD I believe it proved possible (though this was finally settled only after my departure from the scene) to cover a bank loan through ordinary ECGD procedures.
11. The second project was the extension of the Kaitak airport, with which you will be all too familiar.
12.
The
I fear this is rather a lengthy reply to your question. short answer is that Mr Fred Lee entered into no commitment to provide aid; and the only undertaking he gave was that he would endeavour to have the possibility examined as sympathetically as he could in London. This was not at any time expressed as being a quid pro quo or "compensation" for agreement on the part of the unofficials to an increased defence contribution. Of course Mr Lee did recognise that the increased defence contribution we were seeking would inevitably reduce funds available to Hong Kong for social expenditure and that to that extent (and accepting, as he did, Hong Kong's premise that to impose substantial additional taxation would be inimical to Hong Kong's interests) their need for external help could be said to be the greater. But I think the real basis in his mind for the belief that we ought to try to provide Hong Kong with some measure of aid was because he accepted the view that
/had
CONFIDENTIAL
No comments yet.
Private notes are available after approval.