Classifica
SECRET
OUT TELEGRAM
(CONT)
IMMEDIATE
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5.
;
If the Chinese offer immediate support for publication, we
would be happy for you to then say that the Financial Secretary
might like to make an announcement in his budget speech in
March. We suggest that it is better not to mention this timing
at the outset - to avoid seeming to ''bounce'' them, which might
arouse suspicions.
If the Chinese reaction is negative we shall need to
consider again whether it is right nonetheless to make the
6.
announcement.
7. We also wonder whether discussion of this Exchange Fund proposal would open the way for a non-polemical dialogue about Land Fund investments and their monetary and fiscal effects. Exchange Fund fluctuations would cause less concern if there was confidence that the Land Fund was being managed prudently.
8.
Two detailed points. First we are not entirely clear from the proposals whether you would be able to use your forward book to adjust the end of year balance sheet figures if you though
that desirable. Or would the published figures include both
spot reserves and the value of forward contracts? Second we are
not sure that the Q and A material provides a very convincing
reason for non-publication of figures before 1986. Is there a
good practical reason?
ISSUE OF BANK NOTES BY BANK OF CHINA
9. We are also content for you to listen to any points the
Chinese may raise and to discuss whether the time has come to begin technical discussions between HKG and the Bank of China
about the costs and obligations involved. You may wish to repeat the line (particularly point 'G') in our telno 1988 of
For distribution orge" See Phte
Gutunword:
Printed in the UK (or HMSO 6/89 DaFCC1077 C1000 27031
YFE7 C237C
Page 120Page 121
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こぶ
29.
Classification
SECRET