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the total cost is foreign exchange, expenditure.
Appendices
Details of forecast figures are at Annexes A and B.
To
4. The avoid creating the atmosphere of crisis
which was occasioned by the despatch of a Minister
to Hong Kong for the 1966 negotiations, the
Governor had proposed to the previous Administration
that it would be best if, in the light of the
situation as he saw it, he were to assess the
maximum sum which he believed he could persuade his
Executive Council and Legislative Council to accept
as a fair Hong Kong contribution; and then armed
with Her Majesty's Government's agreement in
principle to this sum he would put the matter to his
unofficial advisers. To avoid too frequent local
crises over renegotiation he suggested that any new
agreement should run for five years. The Governor'
proposal was adopted.
5.
Accordingly, in January 1971, on the basis of
Appendices
the figures in Annexes A and B, the Governor offered
to try and obtain an increase in the rate of
contribution from £5 million to £8.5 million per
annum (subject to certain conditions) for a period
of five years beginning in 1971/72.
6. In considering the Governor's offer the
following economic factors were taken into account.
The Colony's economy has made very rapid strides in
recent years;
its Gross National Product has
increased greatly and its revenue is buoyant.
Nevertheless Hong Kong needs to keep on increasing
its exports by about 15% per annum if industry is to
expand sufficiently to provide opportunities for its
school leavers in the employment market and so
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