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низ

Hu 10 TOP COPY

010625

MDHIAN 9609

10

Q DIST?

BA

SECRET

FM PEKING

TO IMMEDIATE FCO

TELNO 71

OF 170459Z JANUARY 92

INFO PRIORITY HONG KONG, UKREP JLG HONG KONG

-2011

M Jhone or

пра

M

17:.

PERSONAL FOR RICKETTS, HKD, FROM AMBASSADOR HONG KONG PERSONAL FOR GOVERNOR UKREP JLG PERSONAL FOR PAUL

GERSONA

FCO TELNO 60 TO HONG KONG:

CONFIDENTIAL FINANCIAL DIALOGUE

1.

I CANNOT RECALL ANY CHINESE STATEMENT WHICH WOULD GIVE A CLUE TO THEIR ATTITUDE TOWARDS PUBLICATION OF THE SIZE OF THE EXCHANGE FUND BUT WE NO LONGER HAVE MOST OF THE PAPERS AND I CANNOT CHECK. IN PRINCIPLE I WOULD EXPECT THE CHINESE TO FAVOUR PUBLICATION, IF ONLY ON THE GROUND THAT IT WOULD MAKE IT LESS EASY FOR HMG OR THE HKG TO COOK THE BOOKS AND TRANSFER FUNDS SECRETLY TO THE UK (AS SOME SENIOR CHINESE LEADERS NO DOUBT SUSPECT WE INTEND). BUT ANY MOVE OF THIS KIND WILL BE SCRUTINISED CLOSELY WITH A VIEW TO ESTABLISHING ITS 'REAL' MOTIVATION AND INTENTION, AND SOME ON THE CHINESE SIDE WILL NO DOUBT QUESTION WHETHER THERE IS ANY NEED TO CHANGE A SYSTEM WHICH HAS HELPED IN THE PAST TO MAINTAIN MONETARY STABILITY IN HONG KONG.

2.

THESE CONSIDERATIONS SUGGEST THAT IF THE PROPOSAL IS AGREED IN LONDON, THE CHINESE SHOULD BE GIVEN A VERY CAREFUL EXPLANATION OF THE REASONS FOR MAKING THE MOVE NOW.

MCLAREN

YYYY

MAIN

23

HK CONFIDENTIAL FINANCIAL

(DIALOGUE)

LIMITED

HD/HKD

DISTRIBUTION

31

HD/ECONOMIC ADVISERS

PS

PS/LORD CAITHNESS

PS/PUS

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