TNAG-0479-FCO40-544-Strength-of-garrison-in-Hong-Kong-1974 — Page 196

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Personal for Governor from Watson.

Your telno. 973: Defence Review.

1.

[To be redrafted in accordance with

Mr Hockaday's letter of 11 October]

2.

As regards timing, we have been pressing in official level discussions for agreement to recommend to Ministers that formal negotiations would not begin until May 1975, as you wish. There is understanding of the problem, but even if Ministers were willing to agree, it has been argued that:-

(i)

the chances of your securing a satisfactory Hong Kong contribution would be less after you had negotiated the tax increases necessary for your social welfare programme. We have said that conversely hopes for an increased Hong Kong contribution could be reduced if the negotiations were to

/coincide

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