4b)
SECRET
MDH
152236
1225
LATTER WOULD NOT BE BUILT IF THE PATROL CRAFT WERE WITHDRAWN. TECHNICALLY THIS SHOULD NOT MAKE ANY DIFFERENCE TO THE CHINESE, SINCE OUR OFFER TO THEM IS TO BUILD AN ALTERNATIVE NAVAL BASE ON THE SOUTH SIDE OF STONECUTTERS ISLAND IN COMPENSATION FOR FILLING IN THE PRESENT NAVAL BASIN. PROVIDED THAT HKG MAINTAINS THIS OFFER, WE SHOULD BE ABLE TO DEAL WITH CHINESE CONCERNS.
IF HOWEVER THERE WERE EVER A SITUATION WHERE THE OFFER TO BUILD A NEW NAVAL BASIN FOR THE CHINESE WAS WITHDRAWN, AND WE WERE FILLING IN THE ONLY ONE CURRENTLY AVAILABLE, THERE WOULD CERTAINLY BE SERIOUS PROBLEMS WITH PEKING.
GALSWORTHY
YYYY
MAIN
3
NO DISTRIBUTION
HD/HKD
NNNN
DISTRIBUTION
3
MR BURNS
SIR J COLES
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