TNAG-0688-FCO40-837-Disturbances-by-police-in-Hong-Kong-1977 — Page 7

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CORRUPTION IN HONG KONG

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round to reading this. On the last paragraph, just as M. Contagzi think Mr. Cater should not write to the Times, I

apposed to him coming here where he w? be "exposed' outside Lis own environment. Do you want to talk? In two recently published articles (in the Far Eastern Economic Review of 23 December, and on the centre page of The Times of Flag B 28 December) Mr Derek Davies, the Editor of the Far Eastern

Economic Review, launches a bitter attack against the Government of Hong Kong for having given up in the battle against corruption. He claims that corruption in the Colony remains as widespread as ever and that the corruption syndicates, far from being broken,

will be able, as a result of the recent amnesty, to exert more 'pressure on young recruits to climb on the corruption bandwaggon. He calls for the dismissal of those senior police officers "who let the community and the Governor down" to be followed by the

evocation of the amnesty and a firm demonstration by the Govern- ment that it will not give in to blackmail. He believes that if this is not done the Government's actions will be interpreted as

a retreat to the situation that prevailed before ICAC was set up, a retreat that, he claims, will be unacceptable to majority public opinion in Hong Kong, to London and to the People's Republic

of China.

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2. The Far Eastern Economic Review is a responsible and highly regarded publication (though it has a reputation for reporting intelligently and accurately on every country in the region except its home base Hong Kong); its Editor is a reasonable man with a high professional reputation (as one would expect in a former member of the Diplomatic Service). Nonetheless, his arguments in these two articles are more than a little confused: for example, when he says that the "triumphant Police Force" will equate the amnesty "with a tacit understanding' that they should be allowed to go on maximising their illicit incomes" despite the fact that the amnesty only applies to offences committed prior to 1977 and that the Governor has made it plain that the drive to eliminate current cases of corruption will be continued as

CONFIDENTIAL