TNAG-0546-FCO40-641-Strength-of-garrison-in-Hong-Kong-1975 — Page 202

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for the RAF to evacuate the whole area. If the RAF retained the smaller area proposed by it, the Govern- ment would not be able to secure the full benefit from the redevelopment of the area since the area in which the RAF would have to concentrate contains the land which the Government would have to sell to derive the best return from Kai Tak. Accordingly, it is proposed that, as a condition of the agreement, the Governor should be advised to insist on the whole of RAF Kai Tak (save for the area required for RHKAAF) being evacuated and the essential facilities reprovisioned at Sek Kong and elsewhere.

(c) Land Releases. A list is to be included in the Memo- randum of Understanding of land releases. A draft of the relevant part of the Memorandum of Understanding has been proposed by Hong Kong officials so as to expunge any existing agreements under which, in certain circumstances, the Government of Hong Kong is required to compensate the UK Government for buildings, installations, other fixtures, and even in some cases the land itself, when released by the Services. It is proposed that the Government of Hong Kong should argue strongly for the inclusion of this provision as a quid pro quo for accepting a move to 75% in the third year of the agreement.

(d) Period of the Agreement. It is proposed that, if the

Governor cannot secure agreement for a 10 year period, then the minimum for which he should be authorised to settle is 7 years.

Public Relations Aspects

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It is recognised that the presentational problems of any agreement are considerable. In order to reduce speculation locally on the outcome of the Defence Costs Agreement it was indicated, when the Governor left Hong Kong in mid-November, that there would not be formal negotiations on the Defence Costs Agreement. It was said that exchanges on this subject would continue through official channels by telegram. The effect of this statement has been to reduce considerably press comment and conjecture. The media generally and the press, in particular, can be expected to build up public feeling on the outcome of the negotiations.

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It will be necessary to set the scene for the resumption of negotiations and to do so by explaining that in view of progress made

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