TNAG-0545-FCO40-640-Strength-of-garrison-in-Hong-Kong-1975 — Page 6

SECRET

Foreign and Commonwealth Office

London S.W.1

The Rt Hon William Rodgers MP Minister of State for Defence Ministry of Defence

Room 6181

Main Building

Whitehall

S1/1

8 December 1975

$6)

HONG KONG DEFENCE COSTS AGREEMENT

1.

Our exchanges over a period of months have now resulted in the text of a complete Agreement. I have recommended to the Executive Council that this text is satisfactory in all respects and should be accepted.

2.

I would have liked to be able to recommend also that both Governments proceeded to an immediate announcement. Unfortunately this is not possible. The Agreement will be of major public interest in long Kong and will certainly be most unpopular and stretch the credit of the Government pretty far. I am not prepared to risk the coincidence of such a situation with the imposition of new import restrictions in Hong Kong additional to the system of restraints already mutually agreed. I think you will appreciate that such a coincidence would place the Hong Kong Government, the Unofficials on whose support the Government relies, and myself in an impossible position.

3.

1 understand from the Secretary of State for Trade that in fact his Department have no intention of imposing such restrictions or of supporting them, but he is unable to speak for his colleagues. I understand that you yourself have since been in touch with the

rime Minister who feels that no categorical assurance can be given except in the light of discussion in Čabinet.

•

In these circumstances I feel that the correct course for both of us to follow is to keep the agreed text on ice while waiting for the uncertain question about inport restrictions to clarify itself. Thereafter an announcement could be arranged at a time to be mutually agreed.

15.