From 'Today' GBC. 4
10 August 1773
!
"^2
18.014
In Northern Ireland was shot dead in an ambush on a van taking building workers home near Antrim. One of the big baking groups wants to raise bread prices again. Police in Texas are investigating what appears the biggest mass murder in American history. The time is eleven and a half minutes past seven.] Most people will be surprised to hear that the colony of Hong Kong could cause Britain a great deal of embarrassment in world financial circles.
in London at the moment is Hong Kong's financial secretary. He is having talks with the Treasury about how Hong Kong's sterling balance of £700,000 which is kept in London. But Hong Kong is threatening to withdraw it thus putting further pressure on the pound. The colony is worried that the British Government won't renew its agreement to protect them against the effects of a devaluation of the pound caused by its floating. A warning of what could happen if the agree- ment' isn't renewed, appears in the influential Far Eastern Economic Review. It's editor has been speaking to Là BBC. inter viewer]
"Well basically Hong Kong owns about seven hundred million sterlings worth of assets in London. Now hitherto Hong Kong has had to hold its holdings in London and has only been allowed to diversify into other currencies to the extent of about 11% of the total. These sums have been guaranteed against a sterling devaluation under an agreement known as the Basle facility. Unfortunately this agreement was expressed in terms of US dollars and as everyone knows the US dollar has been going down in recent years. This means that Hong Kong has got very little compensation for past losses in the value of its assets held in London. Now this Basle Facility is due to end on September 24, after which time Hong Kong is theoretically free to move its assets out of London. So Hong Kong's governor, who is on holiday in London, has gone to the Treasury together with Hong Kong's financial secretary Philip Haddon Cave to see just what London wants of Hong Kong in exchange for an agreement not to shift these assets out, because such a large sum of money is involved amounting to between a quarter and a third of London's total gold and foreign exchange holdings that if some such sum was dumped onto world markets sterling would suffer a humiliating drop and so what Hong Kong is after in exchange for an agreement not to shift all the money quickly is