CONFIDENTIAL
4. We also have the problem of our negotiations over defence lands in Hong Kong. This is perhaps the most sensitive issue on the agenda of the Joint Liaison Group and one on which we have so far made little progress. We now face the possibility of having to take unilateral action over the return to the Hong Kong Government of two sites in the defence lands portfolio; if we do so this will certainly provoke a hostile Chinese reaction. Matters may well come to a head this autumn.
5. For these reasons, I hope that you can agree that the Chinese should receive at least a fortnight's notice of the withdrawal of the first battalion. We would propose to inform them through our Joint Liaison Group representatives in Hong Kong on 5 July. We are confident that they would not leak this information before an announcement. As agreed, we would not propose to inform the Chinese about decisions on the future of the Gurkhas but merely to give them advance warning of the first stage of the withdrawal. I should be grateful for your agreement to our acting in this way.
Your ever,
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CONFIDENTIAL
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