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3.
What were the undertakings entered into by
the colonial authorities in Hong Kong in
return for the provision of exchange rate
guarantees for currency held in sterling under the Basle Agreements; and whether
these undertakings have been observed.
What discussions he has had with the
colonial authorities in Hong Kong
regarding the eligibility of the colony's reserves for exchange rate guarantee
under the current arrangements expiring
in March; and with what result.
We propose to answer briefly in the
following terms, subject to any comments you may have:
"With permission, I will take these
questions together.
The text of the 1968 Sterling Agreement with Hong Kong is set out in Cmnd 3835
of November 1968. Details of their
official reserve holdings are treated as
confidential by the Hong Kong authorities. : Nor in any case would it be appropriate for me to comment on the details of confidential arrangements with individual
official sterling holders.
Following the offer by HMG to guarantee certain official sterling balances in the six month period from 24 September, there