35g.mcu.hs53.16.3
וד >
OF
THE EXCHEQUER
accounts. The methods used in the UK to compile direct investment statistics follow the internationally accepted guidelines as set out by the International Monetary Fund and updated by the OECD in its Benchmark Definition of Direct
Investment.
other
sources
ii. the book value of direct investment covers only the net assets attributable to the parent company.
The overseas subsidiaries, branches and associates may raise funds from
such
as local borrowing or from other shareholders and use these to acquire other assets. The figures do not cover assets managed but not owned by UK companies.
often
iii. Overseas direct investments are
held through intermediate overseas holding companies. Where, in response to the survey, the companies do not provide full details of both the intermediate and the final country of investment there may be some misallocation of direct investment between countries.
I am unable to comment on the figures for particular companies because of the rules which prevent the disclosure of information supplied in confidence in response statistical inquiries such as the Census of Overseas Assets. However the determination of direct investment links is not straightforward. For example, according to public records, Matheson & Co Ltd is owned by a Hong Kong company, Jardine Matheson Holdings Ltd which in turn has a Bermuda based company of the same name as ultimate parent.
Of course direct investment is only one aspect of UK assets in Hong Kong. I am in no doubt that there are very large assets in Hong Kong owned, managed or controlled by UK firms and individuals, and that the total magnitude of UK involvement in Hong Kong is a great deal larger than £2 billion even though it is not possible to be precise.
-
Ever,
JOHN MAJOR