6656X
THE DEPUTY GOVERNOR'S
PRIVATE SECRETARY
HONG KONG
CONFIDENTIAL
11. 5.89
FROM JE W KIRBY
Copies to
Mr George
Mr Quinn
Mr Flemming
Mr Crockett
Mr Kent
Mr Coleby
Mr Anderson
Mr Barnes
Mr Hewitt
Mr Latter
Mr Price
Mr Drage
Mr Elston
Mr Jenkinson
Ms Saunders Mr Webster
1 I spent two and a half days in Hong Kong at the end of April as
part of a more extended trip round the region. In government, I
talked to Jacobs, Nendick, Yam, Nicolle and Owen. In the private
sector I saw Q W Lee, John Gray (HSBC), John MacKenzie (Standard
Chartered), David Li (Bank of East Asia) and the local managers of
the four British clearers. Discussions during the rest of my trip
touched on Hong Kong at various points. I attach a note of
impressions of the situation in Hong Kong, to supplement the
detailed briefing already provided for the Deputy Governor's visit
by Ms Saunders.
2 The note looks, initially, at the policy approach towards
adjustment of an overheated economy and the preoccupations of the
authorities, waiting a little anxiously for evidence that
adjustment is coming through. There are worries about the
constraint which the link with the US dollar imposes on monetary
policy, the boom in the property market, the labour shortage and
the vulnerability of the local economy to developments in China
(paragraphs 1-7).
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