CONFIDENTIAL KK040/5
en Acker Inhen,
Mr Forester-Bennett (HKD, WH304)
FUTURE OF HONG KONG: HKG PAPERS
Reference
RECEIVEŲ IN NEGISTRY
- 7 OCT 1983
TICEP
REGISTRY
FA
Action Taken
382
Mr Morris' minute of 26 September sought comments on summaries of the economic, monetary and financial papers produced by the HKG, and requested that any comments be sent to you. I have the following suggestions:
Economic System
2. Para 1
Replace with:
'Hong Kong is completely dependent on trade. With no natural resources except its harbour, the Territory must export in order to finance imports of both raw materials and consumer goods.
1
347) 1.
CODE 18-77
Para 3
Replace with:
'Hong Kong has important rights under the General Agreement on Tariffs and Trade (GATT) because the United Kingdom is a founder member. The Territory thus has most-favoured-nation status in the markets of all contracting parties. The link with the UK is an important factor in guaranteeing that these rights will continue.
Para 4
There is no mention of the MFA in the original summary and this paragraph might be omitted. (The characterisation of the MFA here is in any case somewhat controversial and not one the HKG would necessarily agree with.)
Para 6
1
Replace with:
Hong Kong's achievements in exporting, and its development as an international financial centre have been fostered by an open business environment with an internationally recognised and impartially administered legal system. The Territory's dependence on trade means a limited role for discretionary policy changes, and HKG's aim of non-intervention leaves decision-making in business to those who bear the risks. Predictable economic policy and low tax rates have encouraged an internationally mobile professional class to use the Territory as a base. Continued success requires confidence that the nature of the Territory will remain more or less unchanged so that investment in Hong Kong's industry will continue.
Monetary System
1
3. Para 1, first sentence Replace .. the third largest financial centre in the world' with 'one of the world's leading financial centres'.
Last sentence
Replace 'would make it
if' with
'would
mean that Hong Kong would cease to be a financial centre if
....
་
After last sentence, add: 'Absence of exchange controls and confidence that they would not be introduced has been particularly important.'
CONFIDENTIAL
/Para 2