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point is that the timetables for, and the participants in the
discussions on the different subjects, will themselves be
different.
Discussions on the Sterling Agreements with Hong
Kong must be linked to the timetable for discussions with
other signatories; the timing and urgency of any discussions
on exchange-rate policy will be influenced by world monetary
developments. But there is no timetable for discussion on
the more fundamental questions of financial structures; nor
indeed does there seem to be much awareness that these are
questions on which we might be able to be helpful. The draft
telegram to the Governor attached therefore has as its
objective the preparing of the ground for a systematic dialogue
on possible reforms of financial structure and management.
6. We agreed that Hong Kong is very short of people both to
plan and to carry out such reforms. They are also suspicious
of any suggested changes which have not been a part of Hong
Kong's success story in the past, and, especially, when they
are pressed on the Hong Kong Government by HMG, whose financial
performance the Hong Kong Establishment affect to despise.
7. We agreed that Hong Kong might need help from us this
autumn but that the offer would have to be made with care.
The Governor is coming on leave on 4 August. We should therefore
take the chance to concert and agree our offer with him in the
course of discussions which we would visualise as ranging
widely over the whole range of problems. The right moment for
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