EXTERNAL ISSUES
IN CONFIDENCE
ANGLO-HONG KONG RELATIONS
While in practice Hong Kong enjoys a considerable degree of
autonomy in the management of its own affairs, particularly in the
commercial, financial and economic sectors, its constitutional and,
to come extent its political, dependence on Britain is accepted.
It is appreciated that without the British connection and its accept-
nbility to China, Hong Kong in its present form would cease to exist.
DEFENCE
In view of Hong Kong's unusual position, security and defence
are live issues and the armed forces play a significant role in the
Colony's affairs. The garrison in Hong Kong consists of four
infantry battalions (three Gurkha and one British), a Gurkha
engineering squadron, five naval patrol craft and a squadron of
RAF helicopters.
ANGLO-CHINESE RELATIONS OVER HONG KONG
3. The Chinese consider the Treaties relating to the cession of
Hong Kong and the lease of the New Territories (paragraph 1.1 above)
as unequal treaties" forced on China during a period of internal
weakness and they do not therefore recognise them, They regard
Hong Kong as a problem left over from history, to be settled when the
time is right. In the meantime, they are content to leave things
as they are, particularly in view of the practical value of Hong Kong
to them. Hong Kong is a valuable direct source of convertible
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