CODE 18-77
C
Mr M Stone
Hong Kong Department/FCO
वि
HWB 733/1.
14
Refe encehyec
-5 JUN 1990
SECRET
FROM: D S FISH
CTN 7 7243 3444)
DATE: 27 April 1990
cc Mr Kerby, ODA
Mr Paul, HK Dept Mr Rew, HM Treasury
You asked for comments on your proposed draft reply to Mr Pusinelli's letter of 4 April to Mr McLaren.
2.
I agree that at this stage there is little that we can say to satisfy OSPA. Fortunately, the link between the Hong Kong and US dollars continues to provide stability, and as long as the link continues the
pressure for a safeguard can be resisted. As I said in my minute of 18 April, I do not believe that we can resist the pressure indefinitely, and that when we do introduce a safeguard it will have to take some account of pension levels in the UK. In replying to the OSPA letter I suggest that we take the opportunity to make a reference to comparability with UK pension levels. The final paragraph of your draft, when read with the first sentence of the third paragraph, will give OSPA the impression that we could well be persuaded of the need for a safeguard in due course. The second sentence of the third paragraph is rather meaningless and could well be omitted. But the third sentence is crucial, and could be extended
mention the concept of comparability as follows:
3.
to
link with the US dollar has
to
do
"The Hong Kong dollar
proved extremely resilient and Hong Kong pensioners continue
reasonably well, certainly in comparison with their UK public service counterparts and HMOCS staff in receipt of pensions from other territories."
In my view the reference to hardship is rather gratuitous in the context of Hong Kong HMOCS. On balance, I would leave it out.
4.
Clearly the sterling safeguard issue will continue to run. And it would be no bad thing if our reference to comparability prompts OSPA to dispute its relevance. In preparation for the debate I think we must again alert the Treasury to the issue before us. I am copying this minute together with my minutes of 18 April, 6 April and 30 March to Simon Rew. Perhaps we can arrange to meet with him to discuss the Hong Kong position generally when I am next in London. Incidentally what happened to the suggestion of a strategy meeting with Mr McLaren?
брик
D S FISH
Head of Overseas Pensions Department
27 April 1990
SECRET
Page 75Page 76
Mr Stone