3. In his speech winding up the debate the
Financial Secretary referred to Mr Lee's "thoughtful
and timely speech" and said that "As I hope to be
holding discussions in London shortly on the
management and security and future of our
aterling assets, I would prefer to say no more
at this stage except that I have taken careful
note of the various points made".
4.
In his letter to Mr Marshall Mr Haddon-Cave
said that he wished to discuss
5.
"(a) with the Bank of England and the
Crown Agents various questions connected
with the management of our funds and
investments;
(b) hopefully with the Treasury and the
Bank of England:
(1) the utilisation of the 10%
diversification facility now available
to us under the Guarantee Arrangement;
(ii) the actual meaning, implementation
and practical value of the
Arrangement in present circumstances;
(iii) the future of the Arrangement and
of the sterling balances (including
present thinking on the implications
for the Sterling Area of the UK's
entry into the Common Market)."
The present position is that Hong Kong enjoys
a considerable degree of financial devolution and is
free to invest its reserves either in Hong Kong
or London. The Hong Kong Exchange Fund Ordinance
which provides for the establishment of a fund to be
/used
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