TNAG-0310-FCO40-346-Contributions-of-Hong-Kong-for-costs-of-maintaining-military-1971 — Page 151

SECRET

GOVERNMENT HOUSE

HONG KONG

ANNEX F TO XCS(71)12

25th May, 1971

Please refer to your letter of 1st April about the Defence Contribution.

2.

I have no received a reply from the Secretary of State to the message from Unofficial Members contained in your letter. This reads as follows:-

"Thank you for your message about the Defence Contribution. I was very sorry to hear from Sir David Trench that you feel that your original memorandum has not been fully answered. I understand that you attach particular importance to the principles set out in paragraphs 13 to 15 of your memorandum. To begin with therefore I would like to clear away any misunderstanding there may be between us in this respect.

You say that you are unable to accept the general principle that the Colony should pay for any specific proportion of the costs of keeping troups in Hong Kong. But HMG have not suggested that you should accept any such principle. Nor have they suggested that the amount of Hong Kong's contribution should be fixed accordingly to any specific formula. Whatever figure may be agreed must however be based on some assessments of the appropriate amount, each for their own particular reasons, by both Hong Kong and HMG. The comparative figures in my earlier message were included simply to illustrate that HMG were not seeking a contribution from Hong Kong any greater than previous contributions, in terms of the total cost of the forces or of Hong Kong's estimated

revenue.

I welcome your assurance that a contribution should be made and I certainly agree that it should be one that the Colony can afford. I must however say that even having regard to the Colony's other financial commitments I find it very difficult to accept that Hong Kong cannot afford a substantially increased contribution. At the same time I gladly assure you that if during the period of the new agreement the economy of Hong Kong were to suffer such a serious adverse change that the continued payment of a contribution of £8.5 million could be shown to be an unreasonable burden on the Colony's finances, HMG would always be willing to consider any representa- tions that Hong Kong might wish to make on the matter.

R.W. Primrose, Esq., MBE, JP,

Administrative Secretary,

UMELCO Office,

Hong Kong.

SECRET

I/......