TNAG-0306-FCO40-342-Equipment-for-technical-institutes-in-Hong-Kong-provision-of-1971 — Page 110

HS Lee Esq HM Treasury London SW1

CONFIDENTIAL

17

06

AMP 77/218/01

23 February 1971

17

I wrote to you on 11 February about a proposal to provide equipment up to a total of £400,000 to four proposed Technical Institutes in 23) Hong Kong. My letter of 15 February indicated a modification of this

proposal but the modification was not in the event pursued.

•

2. The background to the proposal is given in the Submission of which I enclosed a copy with my letter of 11 February. As the Submission says, there is a need for Hong Kong to diversify her industry and improve her technology if she is to sustain her industrial growth and provide employment opportunities for her growing population of school leavers. The new Technical Colleges are regarded as an essential means to these ends. If Britain does not provide the necessary equipment we are informed that it will be provided by the Japanese and possibly the Germans. Our Secretary of State has said that it would be appropriate to assist Hong Kong in this way. It will constitute an investment in people who will thereby be made familiar with British machines and from which we may hope to profit later. The proposal is also supported by the Secretary of State for Trade and Industry. Ministers have therefore decided we should undertake to provide from the aid programne British equipment of up to £100,000 for each of the four institutions within a total cost of £400,000 over a period of four years.

3. The project is essentially one of Technical Assistance and we accordingly propose to finance it from Regional Technical Assistance funds within the Aid Programme. It is in some respects analogous to the arrangement to which the Treasury recently agreed for the provision of £350,000 of equipment to the Indian Institute of Technology.

4. We have of course recognised that the provision of equipment on this scale from Technical Assistance funds would require Treasury Jagreement and paragraph 8 of our Submission noted this. However, by some oversight or misunderstanding a telegram making the offer has in fact already issued to Hong Kong on 17 February. The ODA was unfortunatel not consulted about its issue. I enclose a copy for your information.

ENC.

CONFIDENTIAL

/My