is good evidence that the "Struggle Fund" is virtually
exhausted. Strike payments are being made on a more
selective basis and the recipients are being used for
much of the united front work in labour circles but
obviously some new source of finance must be found in
the immediate future or the workers encouraged to find
alternative employment.
The latter move could, of course,
be a further set back as it would represent an open
admission that the "general strike" had failed.
20.
It is possible that isolated incidents may be
initiated by militant individuals in the Colony; the
necessary encouragement could be provided if current
efforts to restore order in Kwangtung fail and widespread
disorders start again in the Province. However, short
of such a breakdown in Kwangtung, which would inevitably
weaken Peking's prestige locally, it seems unlikely that
violence will receive support from leaders here in the
face of direct instructions from Peking to the contrary.
/21.......
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0900179 5, 8, 313
11
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Page 10
21.
Communist tactics as outlined in paras. 15 to
19 would present Government with a long term and insidious
threat to the morale of its employees, and to the
confidence of the public in its ability to maintain
effective rule in the Colony. A policy of non-violence
and the avoidance of direct conflict with Government
can largely deny the use of legal means to restrict
communist activity. A complicating factor is that the
Chinese have made it fairly clear that they intend to
treat the British diplomatic staff in Peking as hostages
for our future conduct here. None the less any overt
defiance of the law must be dealt with firmly and
expeditiously and communists should, as far as possible,
be subject to normal legal process.
22.
The next phase in confrontation could thus
present Government with more complex problems than were
faced in the past. In particular there will, undoubtedly,
be considerable pressure to relax emergency restrictions,
release prisoners, both those convicted of offences and
those detained under Emergency Regulations, and the
cessation of violence will engender a false feeling of
security. It would, however, be inadvisable to begin to
dismantle our emergency structure until we are much
clearer about the direction in which the communists are
moving.
23.
On the other hand Government must seek, as far
as possible, to deny the communists any genuine grounds
for exploitation. Clearly social services and industrial
relations will be of major importance in this respect.
However, it is emphasised that the grievances which
the communists may seek to exploit will be typically
/Chinese.....
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4800176 p.7. 117
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Page 11
Chinese and in the local context, rather than orthodox
labour grievances by normal standards. Countering the
communist propaganda machine, will be a major factor in the
future struggle to win the hearts and minds of the
population of the Colony.
Conclusions
24.
All available intelligence indicates that the
authorities in Peking are now in direct control of communist
activities in Hong Kong. The present declared communist
policy is, in the long term and without the use of
violence, to increase their influence here and erode the
position of the Hong Kong Government while, at the same
time, enjoying the economic benefits of the Colony.
25.
In the next few months, the Hong Kong Government
will be faced with an insidious campaign of subversion,
during which the communists will endeavour:-
a)
to consolidate their ranks and improve morale;
b)
c)
d)
e)
to intensify their indoctrination programme,
making extensive use of the thoughts of MAO
Tse Tung;
to maintain a strong anti-Government propaganda
campaign, staying on the fringe of the law;
the press apart, overtly to comply with the
law thus avoiding, as far as possible, direct
clashes with Government;
to continue and intensify attempts to subvert
and vilify Government Servants, particularly
the Police Force; and
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26.
f)
to initiate a concerted campaign to widen their
base of support among the general public, taking
up and exploiting whenever possible grievances
in all spheres of society.
To counter this new phase of communist
confrontation the Government must, in addition to
maintaining law and order and its own authority to the
maximum extent possible, continue steadily with carefully
considered policies designed to effect genuine and
lasting improvements in standards of living, especially
amongst the poorest classes. Particular care will be
necessary, however, to avoid policies which endanger
the economy or which cannot be reasonably fully sustained
if economic conditions turn adverse. In all other ways,
endeavours should be made, where possible, to avoid
generating genuine public grievances or causes of dispute,
including trade disputes. The public relations machinery
must be geared to meet the challenge of communist
propaganda, but must not solicit public support by
encouraging expectations which cannot or may not be
fulfilled.
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T..
ET
Commonwealth Office
S.W.1
272
RECEIVED ARCHIVES N
Dear James,
14 DEC 1967
FD!!
12 December, 1967
I enclose draft notes which we are proposing to provide
for the use of our Minister in Cabinet on Thursday, 14 December,
should he decide to report on the situation in Hong Kong.
I should be grateful if you would let me know by 3 p.m.
to-morrow, Wednesday, 13 December, whether you have any
comments.
J. Murray, Esq., Foreign Office.
Yours
Bunny
Perised version
Revi
of parar 5 to and
Sent to The Carlo co by hand
TO
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13
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!
TO. CRET
ET NOTES FOR USE OF THE BRIPETARY OF STATE
IN CARTERET I THURSDAY, 14
HONG KONG
Internal Situation
There has been a steady decrease in the use of genuine bomba,
but greater selectivity in the choice of targeta. The police have
been the main target for bomb attacks and other acts of violence.
But in a recent report the Governor states that police morale remains
high and unaffected.
2. The use of communist schools for subversion and for illegal and
violent activities continues to cause concern. One such school has
been closed as the result of an explosion on the premises where
unsophisticated devices were being made.
3. The Communist press in Hong Kong, though avoiding incitement to
violence, continues to pour out anti-British propaganda and to make
maximum use of alarmist rumours and local discontents (e.g. the
level of salinity in the water supply, devaluation). We have been
given, both in Hong Kong and Faking, clear warning that we touch the
C.P.G.-owned newspapers at our peril.
There have been only minor incidents on the frontier.
Attitude of China
5. There are a number of straws in the wind which indicate that
China may be looking for an accommodation on Hong Kong:
(1) The not unsatisfactory outcome of the Hong Kong border
talks.
(11) The tone of the Hong Kong Communist press has moderated
in the last few days.
(iii) Local Communist press circles have put out feelers that may
indicate they wish to avoid the inevitable
confrontation that would arise from legal actions taken against
Communist newspapers.
(iv) There le information (from a delicate source) that, in
Canton (and likely therefore to be parallelled in Peking also), there is
a faction advocating a "dismounting" of the confrontation in Hong Kong .
(v) There has been a slight improvement in Sino-British
relations, in that the Chinese have matched in Peking our gesture in
lifting some of the restrictions placed on the Chinese Embassy staff in
London. Exit visas have also been granted for one member of our
Mission's staff and his family.
bis refs (who has
haul a suurema humming
Shanked mm)
/(vi)...
TO.
ET
6.
(vi) In recent diplomatic exchanges the Chinese have
emphasised that "the Hong Kong problem" must be solved before there can
be any improvement in Sino-British relations.
جد أنه لا
But it is too early to say whether this will lead us anywhere.
There are no signs that the Chinese are taking effective steps to
moderate the activities of the local Communiste. And it seems
unlikely that the Chinese will back down on Hong Kong unless they
can point to some "victory" even if only a "paper" one.
7.
Meanwhile we are considering with the Governor and our
Charge d'Affaires in Peking -
(a) means of avoiding provocation in taking necessary action
to deal with Communist activities in Hong Kong until
(b)
Chinese intentions become clearer, and
must seat cons
the modalities of opening up some dialogue with the
Chinese if that is what they are looking for.
Extract from K.
(67) 2nd Manding, held 22 Sept
Lud
Derso -to
TOR SECRET-
HONG KONG:
1) kr. Hellers
25/
Fex 218 Enter by 20ce-
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GENERAL SITUATION, AND PROPOSALÉ FOR ASSISTANCE
5/m 27.
ল
The Committee had bofaro then a nemorandum by the Connonwealth
V'Socretary (K(67) 3) to which was annoxed a list of various projects
and
RECEIVED. JIN ARCHIVESS 1969. 30
ZOET 1967
FOIL!
+
measures through which the United Kingdon could demonstrate support and
goodwill for Hong Kong during the present troublos. Boforo considering
this nonorandun the Committee discussed generally the current situation
In the Colony.
Ineral Situation
THE COMMONWEALTH SECRETARY, welcoming the Governor of Hong Kong [Sir
David Tronoh) to the mooting said that in the last wook or so there had
been a lessening of tension in Hong Kong, and the Hong Kong/Chinoso
bordor had boon relatively oala, though with some increase in illogal
immigration. The indication was that the Coramist loaders in Hong Kong
tad decided to reduce torrorist activity during the period leading up to
the Chinese celebrations at the beginning of October, and concentrate
instead on propagating Haoist doctrine. It could not howovor be assumed
that the Communist loadership could control its supporters in Hong Kong.
Terrorist incidents, sono of them sorious in consequences to life and
limb, continued on a substantial scale. boreover thero was a risk of a
resurgence of activity whom the Governor arrived back in the Colony on
Sunday 24th Septorbor,
on
The food situation had improvod, and thero was an oxpootation of a
resumption of rice supplies from China on a scale that would nako good
the provious arrears. The Hong Kong reservoirs now had enough water to
last the Colony, given a sovore rationing syston, through the next dry
scason even without a resumption of supplies from China; thoro was as
yot no indication whether the Chinese would resume supplies as usual on
1st October. Dospito all difficulties the level of economic activity
remained high, with exports in July and August substantially above the
leval of the corresponding nonths in 1966; similarly tourist notivity
was
10 per cent higher than last year.
At the provious nooting of the Committee roforonco had been rade to a
possible nood to impose the death penalty for certain torrorist
offancos. This question had boon discussed with the Governor during his
prosent visit to this country, and would be considorod further in the
light of dovolopments in Hong Kong. If necessary a proposal would be put
to the Committoo in due courso.
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Hong Kong was a unique and anomalous Colony with a largo and donsoly-
paokod population procariously poised on the edge of the vast territory
of Communist China. It was ovident that the overwhelming majority of its
population supported the British action and the present administration
in the Colony. The maintenance of this support was crucial to the
Colony's position, and it was against this background that the Committee
should lator consider how support for the Colony could appropriato bo
demonstratod,
SIR DAVID TRENCH said that the present reduction in Chinese pressure was
a lull, not a thar. Rindanentally the position of Hong Kong renainod
unchanged: it was a hostage to the Chinese, who could gain control if
they so wished either by axtornal aggression or by internal subversion
(though the latter would nood to bo bettor managed than the prosont
anatour offort), Wo did not know whether the Chinese wished to obtain
control:
it was thoir declared intention to do so but it was not clear whether
those
who mado such declarations hal, or would continue to have, offoctivo
control within China. On norits thoro wore powerful reasons why China
should loave Hong Kong as it was: the assumption of control would daŋago
China Goonomically, present hor with a large administrativo problen and
possibly have far-reaching international repercussions. Our ability to
resist Chinose pressure dopended partly on Chinoso intentions but partly
on our success in naintaining confidonoo within Hong Kong on the
adequacy of tho security forces, on the Colony's economio prospects and
on the attitude of the United Kingdon towards the Colony. Ovor the last
ton-to fiftoon years thero had boon sono erosion of Hong Kong confidence
in the United Kingdon as the rosult of a number of zotions which we had
takon, which though individually thoy might be justifiablo but
cumulatively woro rogarded in Hong Kong as indicating an unsympathetic
United Kingdon attitudo towards Hong Kong's position as a depondent
torritory. Examples were the terms of
salo to Hong Kong of the naval dockyard and the discontinuance of joint
user arrangements for the Kai Tak airport. Despite causos of friction
such as these Hong Kong's loyalty towards the United Kingdon ronnined
strong, and the policies porsued by the Hong Kong Government ware
broadly accoptable to the local populace. It was howevor important,
especially during the prosont difficult period, that the United Kingdom
should tako all possible action to restore and onhanoc Hong Kong
confidence,
--2-
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In discussion it was suggested that considerations of self-intarest as
much as of loyalty bound Hong Kong to the United Kingdom, and that Hong
Kong aritioåsns of United Kingdon policies towards tho Colony night bo
overstatod. The European community in Hong Kong was provincial in
character, with a narrowly confinod social life in which grievances
tended to bo talked over and nado much of, The Governor and his
officials had achioved a notable success in porsuading the Hong Kong
Exocutive Council to accept our proposals for an increased dofonoe
contribution from Hong Kong; in asking the Colony to noot an oloment in
the cost of naintaining forces in internal socurity we vero doing no
more than appoaling to the self-interest of the population. It was,
however, tho view of the Governor that Hong Kong like other dependent
territorios, did not accopt an obliga- tion to contribute to the cost of
its defence, whothor external or internal, and had rejected the
proposition that the Colony should make a contribution specifically to
the cost of internal socurity; the increased contribution which was
still the subject of sone resentment in Hong Kong, was regarded thore as
ex gretia assistance to tho thited Kingdon in nooting defence
costs.
The Committoo -
(1) Took note of the statements by the Commonwealth Secretary
and the Governor of Hong Kong about the ourront situation in Hong Kong,
and of the points mado in discussion.
Assistance to Hong Kong
The Committee then turned to consider the Commonwealth Soorotary's
nonorandum (K(67) 3) about measures of support for Hong Kong.
THE MINISTER OF STATE FOR COMMONWEALTH AFFAIRS said that his recent
visit to Hong Kong had convinced him that the key to our ability to hold
We the situation in Hong Kong was tho maintenance of public confidence.
needed not only to maintain public moralo and the will to resist Chinese
pressure, but also to do all we could to protect the Hong Kong econory
from serious damago. An coononic rocossion in Hong Kong, in addition to
its serious internal consoquenoos, could woll bring about a situation in
which the Colony bocano financially dopondont on the United Kingdon. The
Annox to X(67) 3 describod various projects, which had boon discussed
with the Governor of Hong Kong, through which we could demonstrate our
dotormination to fulfil our responsibilitios towards the Colony. The
nost important of those politically (though its economic advantages wore
loss cortain) was the proposed cross-harbour tunnol linking Hong Kong
Island and Kowloon,
extensions at Kai Tak airport;
Othors included:
-3-
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по
joint educational projects; assistance with cortain additional military
oosts; and tho provision by United Kingdon ovorase posts of help for the
Hong Kong Export Credit Guarantee Corporation. The memorandum was
circulated at this stage in order to inform tho Committee of various
possibilities which wore being pursued by the Commonwealth Office;
decisions wore yet called for. During his visit to Hong Kong in October
he proposed to examine further the possibilities for help under the
various hoads, and also the prospects for labour reforms and social
service development.
In discussion of the proposals for assistance to Hong Kong, the
following points were made
(a) Hong Kong was at prosent prosporous and would continue so, provided
that political difficulties did not disturb economic development. The
Colony hold sterling balancos in this country amounting to £350 million
in all, of which rather more than half wore official holdings. In tho
last six months private holdings of storling had fallen off by sono £35
million, but the increase in Hong Kong official holdings had more than
offset this docrosso. Although part of those suns was required as
backing for Hong Kong currency, there was no shortage of liquid funds
available to finance development in Hong Kong.
(b) The proposed cross-harbour tunnel was a 16-17 million project; the
likely contractors wore Costains, to whon a monthly penalty payment of
£30,000 was now due until a contract was signed. £10 million of the cost
was to be raised by a bank loan which would be ultinatoly guaranteed
The by tho Hong Kong and United Kingdon Govorimonts in equal shares.
remaining £6 million would be found from local funds, including sono
private investment, Our attitude towards this projoot was likely to be
regarded in Hong Kong as a touch-stone of our dotormination to support
the Colony, The Treasury had agrood in principle to our guarantoeing our
£5 million of the loan, subject to thero being no drawing on tho £10
million loan boforo it was cortain that the remaining £6 million
nooded would be nado availablo from other sources. The Hong Kong
Government sinilarly was anxious to ensure that other nonoy beoane
available for the projoot. If the current discussions anong officials
did not produce an agreement, the Hinistor of State for Commonwealth
Affairs would raise the nattor with the Hong Kong authorities during his
visit with a viow to a settlement; a Treasury brief would be proparod
for the purposo,
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(c) Extensions to the runway and other facilities at Kai Tak airport at
a cost of about £10 million would soon be needed if the airport was to
handle larger and faster aircraft. In view of the importance of the
airport to the British Overseas Aircraft Corporation (BOAC), in respect
both of control, of cabotage rights and as a bargaining counter in
negotiations for air traffic rights, it was proposed that the United
Kingdon night provide £34 million towards the total cost in the form of
a
grant. Failing such assistance it was unlikely that Hong Kong would
carry out the extensions. It was, however, doubtful whether the United
Kingdon would feel justified in according priority to expenditure of the
order indicated for this purpose, particularly since much of the benefit
would accrue to other airlines and to the tourist industry in Hong Kong.
However the proposal would be examined in detail by the Departments
concerned,
(a) The proposal for United Kingdom capital assistance towards further
technical training facilities, which could play a valuable part in
regional development in the Far East, had yet to be examined in detail.
(e) The suggestion had been made that the cost (anounting to about
£150,000) of wire for a second boundary fence should be borne by the
United Kingdon, the labour and compensation costs being borne by Hong
Kong, The amount involved was small relative to the importance attached
to such a gesture in Hong Kong, particularly after the agreement to
increase defence contributions. If a United Kingdon contribution were
agreed it would not be appropriate for it to fell on the defence vote.
(f) we had not so far folt able to accede to the Hong Kong request that
our oversea posts should supply information to the recently established
Hong Kong Export Credit Guarantee Corporation. Our refusel to do so
caused sone resentment in Hong Kong, where it was regarded as a failure
on our pert to treat Hong Kong as a dependent territory for whose
external affairs we were concerned. The problem was in part that Hong
Kong was also a commercial competitor: this inevitably limited the
assistance that we could appropriately supply, the more so since our own
exporters supplied information to our oversea posts on a basis of
confidence which would be undermined if they suspected that information
so supplied might be made available to Hong Kong businessmen,
Furthermore, the Diplomatic Service was under heavy pressure to reduce
costs by cutting overseas staff, and it was therefore no time to require
posts to take on extra work, Nevertheless
(97793)
-5-
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the request should not be rejected out of hand but investigated in
detail
in order to determine what were the Hong Kong requirements and how far
it
was practicable and desirable for us to meet then, In the first
instance,
the proposal should be discussed further during the Minister of State's
forthcoming visit to Hong Kong.
-
{૪}
There were a number of other minor respects in which Hong Kong felt that
it was not being fairly treated by the United Kingdom for example, it
was said that United Kingdom officials in Hong Kong did not pay income
tax whereas we required payment of tax in the converse situation.
Complaints of this kind would be investigated by United Kingdor:
Departments, if necessary at Ministerial level, if particulars were
supplied by the
Hong Kong Government.
The Committee
-
(2) Invited the Financial Secretary, Treasury, to arrange for
a brief on the cross-harbour tunnel project to be supplied to the
Minister of State for Commonwealth Affairs for the purpose of his
forthcoming visit to Hong Kong.
(3) Took note that the Minister of State would discuss further during
his visit to Hong Kong, and would arrange for
further interdepartmental official discussion of, this and other
projects for assistance to Hong Kong listed in X(67) 3.
-6
TOP SECRET
THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMEN
The circulation of this paper has been strictly limited.
It is issued for the personal use of.
RECEIVED IN
ARCHIVES No. 31
- 3 AUG 1967
キロリー
OPDO(DR)(67) 51
2nd August 1967
TOP SECRET
CABINET
MR.K. Bolland
Copy No.
12
Mad Wilger * FAN
DEFENCE AND OVERSEA POLICY (OFFICIAL) COMMITTEE
DEFENCE REVIE," WORKING FARTY
ра
7
मोन
HONG KONG
Note by the Secretaries
The attached extract from a recent special assessment by the Joint
Intelligence Committee ia circulated for the information of the Working
Party.
(Signed) R.L.L. FACER
M.J. MONI.NTY
Cabinet Office, 5.7.1.
2nd August 1967
TOP SECRET
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9.
At the same time the Chinese authorities have still not replied to
requests for additional water supplies in July and it now seens probable
that they are using this as a means of pressure. In addition the fact
that buyers are being asked by the Hong Kong branches of Chinese
Government trading agencies to recommend alternative ports of
transhipment for any goods they purchase suggests that the Chinese
authorities agree that overseas
buyers of Chinese goods should be encouraged to by-pass Hong Kong. It
is clear that the local Communists are seeking to undermine economic
confidence in Hong Kong and are ready to accept the consequent economic
damage to their own interests; and that they are supported in this by
the Chinese Government
authorities.
TOP SECRET
TOP SECRET
INWARD TELEGRAM
TO THE COMMONWEALTH OFFICE (The Secretary of State)
FROM HONG KONG (0.A.0.)
Cypher
D. 12 July 1967
R. 12
1020Z
173
на
06224
RECEIVED IN ARCHIVES No6, 3}}
NO.
26 JUL 1967
IMMEDIATE
TOP SECRIT No.1013
N.R
ре
FA
Addressed to Commonwealth office Repeated
POLAD Singapore No.233
(C.O. please pass IMMEDIATE)
My immediately preceding telegram.
Hong Kong Confrontation.
Isolated cases of violence and threats to Europeans have been reported,
though it would be wrong to describe the focus of present activities as
"anti-European". There has been talk of the preparation of terrorist
methods for use against such targets as the police and Europeans.
2. As yet no terrorist/assassination organisations are known to exist,
as such, in the Colony. If, however, Communist operations become even
more violent the existence of an organised network, readily available
supplies and plenty of trained manpower close at hand in China would
make their establishment relatively simple. In planning for the future,
therefore, we must take into account the possibility of a straight
terrorist campaign developing in a comparatively short time, directed
against the police, Government servants and those co-operating with the
Government.
(Passed as requested)
(Advance copies passed to Meaars. de la Mare, Wilson, Bolland, Denson
and Commonwealth Secretary)
Distribution
-
P.8. to Minister of State
Sir A. Galsworthy
Mr. W.S. Carter
Mr. Russell
Mr. JerroN
Mr. Gaminara
J.I.C. EXTERNAL DISTRIBUTION
DEPARTMENTAL DISTRIBUTION
Copies also sent to:
P.8. to Prime Minister
Cabinet Office
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Foreign Office
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H
D.I.O., J.I.R.
P.8. to Mr. Rodgers Mr. de la Mare
Mr. Bolland
Mr. Wilson
= =
TOP SECRET
Mr. Denson
Mr. Foggon
/FO/CO
TOP SECRET
FO/CO (IPGD)
(IRD)
No comments yet.
Private notes are available after approval.