TNAG-0541-FCO40-636-Strength-of-garrison-in-Hong-Kong-1975 — Page 105

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ACDS(Pol

ACDS(Ops DMO

DASD

AUS (P&B)

AUS(CF)

SECRET

UK EYES A

AUS(D Staff)

AUS (NS

AUS(AS)

FCO(HKIOD) - Mr. Dinwiddy FCO(Defence Department) Treasury Mr. Fitchu

Copies to: DUS(P)

Mr. Jackson

Head of DS6

DS1 (Mr. Jones)

Col GS MO2

Reference

AUS(GS) 263/75

199

(189)

Col GS ASD2

AD of DP(C)

Head of F1 (Air)

DN Plans (Captain Abrahams)

DD Air Plans

Head of DS11

DDAQ

SPO/CDS

SECCOS

HONG KONG: FINANCIAL NEGOTIATIONS

Reference: A. MO5/14 of 11 June 1975 (Not to all)

B. D/DS6/46/66/1 of 23 June 1975 (Not to all)

Following discussion at a meeting which I held yesterday with those most closely concerned with the forthcoming Hong Kong financial negotiations (including representatives of the Treasury and FCO), I now attach a revised draft of a paper for the Defence Secretary to put to the DOPC as envisaged in Reference A.

2. As regards the future garrison of Hong Kong, the paper follows closely the recent Chiefs of Staff conclusions. As regards the financial terms, the consensus at my meeting was that in spite of the Governor's view that £17M a year is the maximum contribution which could be expected from Hong Kong at least initially, our opening position should be to ask for 75% (i.e. £25M). We were influenced both by the current pressure on the defence budget which makes it important to secure the maximum contribution from Hong Kong and by the need to provide some room for subsequent manoeuvre in the negotiations.

3. It is desirable to secure Ministerial agreement to the paper as soon as possible, so that the negotiations can get under way.

It may be possible for the Secretary of otate to clear the paper with his DOPC colleagues out of committee; but if it has to be discussed at a meeting I understand that 9 July would be the most convenient date. In order to permit circulation by then I should be grateful if I could have your clearance of the draft or comments on it not later than mid-day on Wednesday 2 July.

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27 June 1975

R.J. ANDREW

AUS(GS)

SECRET

UK EYES A

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