04 JAN 1988
04 JAN 1988
CONFIDENTIAL
6
Mr McLaren
PS/Lord Glenarthur
Private Secretary
In ot Lar
com then.
411
12
2
3
4
12
FROMR Paul
DATE :
ски
8
ៗ 65
Hong Kong Department
4 January 1988
PS/PUS
Mr Gillmore
News Department
Economic Advisers
2 Stenray n Stató
E-
vi سی
HONG KONG STOCK EXCHANGE: INVESTIGATION BY ICAC
Ministers will wish to be kept up to date on the latest
developments on this subject.
1.
2.
I attach:
A
(i)
Hong Kong telno 11, which reports the outcome of the
operation;
B
(ii)
the ICAC press statements;
C
(iii)
the Hong Kong Government's press statement;
D
(iv)
3.
the record of the meeting of the Stock Exchange Committee on
2 January.
The Hong Kong Stock Exchange opened for business as normal on
Sharply 4 January. Share prices fell initially (in line with the substantial fall in Tokyo) but staged a late rally. It is clear
faul that the overriding cause of this was worry about the continuing decline of the US dollar. My judgement is that the ICAC arrests
have had only a marginal effect on trading confidence. However the longer term effects of the affair on international confidence is
Hong Kong as a major financial centre will still need to be
CONFIDENTIAL