DECRET

get out of sterling altogether, this will give them problems.

They will take it amiss if we now tell them too brusquely

that they must maintain their MSP in accordance with their

Agreement.

4. In this situation we have told the Treasury and the Bank

that we must reply to Hong Kong as helpfully as we can in

both substance and tone. The attached draft telegram has

accordingly been agreed by the Treasury and the Bank of England.

Mr Holland and FRD also agree. I understand the US has ruled

that the Secretary of State should be consulted.

telegram to Hong Kong is submitted accordingly.

The draft

10 July 1973

Gerver

Copy to:

V Mr Royle

PS to PUS

Mr Holland

Mr Marshall

Miss Pestell/Mr Lewty FRD

A C Stuart

Hong Kong & Indian Ocean Department

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