CONFIDENTIAL
3
The United Kingdom
8.
But Hong Kong was established for the good of the United Kingdom, not that of China. HMG may now accept, under the UN Charter, that the interests of the inhabitants and not those of the metropolitan power are paramount; nevertheless it is reasonable to ask what the United Kingdom now gets out of Hong Kong.
9.
It is often represented to me that Hong Kảng is a positive disadvantage to the United Kingdom because the future lies in political and commercial relations with China, and these are embarrassed by the existence of the Crown Colony. Though friction with China does arise on points of detail and principle over Hong Kong, I find it helpful always to bear in mind that Hong Kong continues to exist because the Chinese Government believes its existence to be on balance beneficial to China. There is no need therefore to feel apologetic or defensive vis-a- vis China about something which benefits China, though no doubt in their inimitable way and for their own ends the Chinese sometimes make us feel just that. Nor do I think that historically speaking Hong Kong has done us any harm in China. Indeed I personally believe that as an important if admittedly somewhat tainted source of benefit to China, and as one of the few points of real substance in the Anglo/Chinese relationship, Hong Kong renders HMG more interesting and substantial in Chinese eyes than otherwise would be the case; particularly so long as we make a success and not a mess of the Colony.
10.
Moreover Hong Kong provides the last tangible evidence of Britain's long association with and experience of the Far East, and the Chinese leaders appear to set some store by this, if Chou En-lai's remarks to Mr. Peter Walker last March are anything to go by. The same applies to other countries in the area. These are generally impressed by the success of Hong Kong as a commercial, industrial and financial centre, and by its administrative and social achievements, and give credit for its success to HMG. Moreover some of these countries have a substantial stake in the Colony, notably Japan. I think that all this amounts for the UK to that asset generally called prestige which, though un-negotiable and un-quantifiable is none the less an asset. It certainly provides added authority and sometimes a degree of leverage.
11.
In more tangible terms, Hong Kong offers a substantial market to the United Kingdom. Traditionally the United Kingdom had a favourable balance in its trade with Hong Kong which between 1953 and 1962 averaged £11 m.
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CONFIDENTIAL
Yes but
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