CONFIDENTIAL
FM HONG KONG
TO PRIORITY FCO
TELNO 1000
OF 28092OZ MARCH 89
CONFIDENTIAL
FOR THE ATTENTION OF PAUL, HKD
TENTION
5/i-
НКС105
OUR TELNO 804: EXCHANGE FUND ORDINANCE
TOP COPY Q DIST?
35)
1 MAY WE PLEASE HAVE AN EARLY REPLY TO OUR TUR.
2
072134
MDLIAN 8037
felour
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2. THE AGGREGATE AMOUNT OF MONEY TRANSFERRED FROM THE GENERAL REVENUE TO THE EXCHANGE FUND NOW STANDS AT HKD 45 BILLION. ON TOP OF THIS, THE GENERAL REVENUE IS HOLDING ABOUT HKD 14 BILLION OR SURPLUS CASH IN THE BANKING SYSTEM. THIS MONEY NEEDS TO BE MORE PROPERLY MANAGED. IT MAY ALSO BE REQUIRED BY THE EXCHANGE FUND FOR THE PURPOSE OF EXCHANGE RATE INTERVENTION. BOTH FACTORS POINT TO THE NEED TO INCREASE THE TRANSFER OF MONEY FROM THE GENERAL REVENUE TO THE EXHANGE FUND. ALTHOUGH, AS EXPLAINED IN OUR TUR, OUR INTERPRETATION OF THE LEGAL POSITION IS THAT THE BORROWING LIMIT OF HKD 50 BILLION IN THE EXCHANGE FUND ORDINANCE DOES NOT APPLY TO SUCH TRANSFERS, WE DO NOT WISH TO GO OVER THAT FIGURE WITHOUT YOUR AGREEMENT TO THAT INTERPRETATION.
WILSON
YYYY
ΜΑΙΝ
18
LIMITED
HKD
LEGAL ADVISERS
NNNN
DISTRIBUTION
18
MR MCLAREN
MR GILLMORE
1
PAGE
CONFIDENTIAL