<<<<
Classification
SECRET
i
CUT
ELEGRAM (CONT)
Precedance
IMMEDIATE
ら。
this however, we are content in principle with the proposal that
the Financial Secretary should announce in due course the
Government's intention to provide greater transparency regarding
the Exchange Fund: that the office of the Exchange Fund should
then publish a summary of the fund's year-end accounts from 1986
to 1990: and that there would then be annual publication of the
figures six months in arrears. We agree that a time-lag of
about six months is desirable to reduce the risk of the figures
10 causing difficulties with the markets, eg if they show a large
decline in the reserves. Would you make clear in the initial
announcement that the figures would be published at a certain
time each year (presumably July?) so that a routine announcement
will be expected? We would like to be consulted again before
any decision to publish the figures more frequently or with less
of a time-lag.
4.
We therefore also agree that you should consult the Chinese on this proposal at the next meeting in the confidential
financial dialogue. We hope that they will respond swiftly and positively. Despite Lu Ping's encouraging remarks to the
Financial Secretary, we agree with Peking telno 71 that it will
be important to explain persuasively to them the reasons for
making the change. We think that you should put the emphasis on
the financial and monetary arguments, backed up by the IMF, and
not labour the arguments about public accountability which
figure in the memorandum for the Exchange Fund Advisory
Committee. The Chinese could be expected to react sharply to a
proposal which seemed to be aimed at reducing the powers of the
Executive in favour of eg Leg Co, and to wonder whether our main
LegCo,
consideration was lack of trust that the SARG's Financial
Secretary would act with the same probity as successive
13
Financial Secretaries have done since 1945.
34
for distribution order sex Pite
Caterweral
Printed in the UK for HMSO 6/89 DdFCC1077 C1000 27081
YF87/C037C