TNAG-0308-FCO40-344-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 82

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) PARAS. 10 AND 11. IT WILL CERTAINLY BE POINTED OUT THAT HONG

KONG WAS, WITHOUT DOUBT, THE AREA WORST AFFECTED OF ALL BY IEVALUATION: PARTLY BECAUSE, AS A COLONY, HONG KONG WAS TIED TO

STERLINC. THE PRESENT TEMPORARY AND PARTIAL PROTECTION, IT WILL

BE

PE ARGUED, IS NO ANSWER TO THIS, PARTICULARLY AS WE REMAIN VIRTUALLY TIED TO STERLING. MOREOVER IT WILL NOT PASS UNNOTICED THAT THE FIGURES

YOU QUOTE SHOW THAT WE HAVE MORE MONEY AT RISK NOW THAN IN 1968.

UNOFFICIAL MEMBERS

WOULD NOT BE INCLINED TO AGREE THAT IT WAS OTHER THAN REASONABLE

THAT ALMOST THE WHOLE EFFECT OF ANY FUTURE STERLING DEVALUATION

SHOULD BE BORNE BY THE U.K. SEMICOLON THEIR ARGUMENT IS THAT THE

WHOLE OF THE PREVIOUS AS WELL AS ANY FUTURE DEVALUATION SHOULD

BE PORNE BY U.K. (IT IS UNLIKELY THAT THE RECENT DIVERGENCE OF INTEREST RATES WILL AFFECT THIS VIEW).

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WHILE I SHOULD BE GRATEFUL FOR YOUR FURTHER VIEWS ON THE POINTS

IN PARAGRAPH 3 ABOVE, I MUST NOW URGE THAT WE DO NOTHING TO

ENDEAVOUR TO HASTEN THIS ISSUE FOR THE MOMENT, AS YOU KNOW,

I HAVE ALWAYS REGARDED THE PUBLIC PROTESTS WHICH WILL FOLLOW THE

ANNOUNCEMENT OF ANY GREATLY ENHANCED DEFENCE CONTRIBUTION AS BEING

LIKELY TO LEAD TO DISTURBANCES UNLESS GREAT CARE IS TAKEN. !

AM ANXIOUS THEREFORE THAT WE LET THE PRESENT WAVE OF BOMBING'' DIE

DOWN, AND ANALYSE THE REAL CAUSES OF IT, BEFORE WE HAVE TO DISCLOSE

PUBLICLY THE RESULTS OF THESE NEGOTIATIONS.

TRENCH

FILES

HKD FED

DEFENCE D

FPAD

ATD

CCD

PS

COPIES TO:

MR D J J BRACK, TREASURY MR A F THORPE, F1(AIR)2 MOD

MR RJ SMITH, DOE, LAMBETH BRIDGE HSE MR P D NAIRNE, MOD

MR R GEDLING, TREASURY

MR E STRETTON, DOE, LAMBETH BRIDGE HSE MR F H GWYNN, MOD

û

PS TO PUS

SIR L MONSON

SIR S TOMLINSON MR WILFORD

MR ROSE

NNNNN

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