3 January 1992

JP McIntyre Esq

HMTreasury

Parliament Street

LONDON

RESTRICTED

Can't DIALOGUE

On For MATTESZI

this ball

Foreign & Commonwealth

Office

London SW1A 2AH

Telephone: 071-

Dear Paul,

HONG KONG: FINANCIAL MATTERS

97

1991 Dialogue

ANNEX FILE

2

I am replying, further to Peter Ricketts' letter of 27 November, to yours of 26 November about documentation for the Hong Kong Government bond issues. I am sorry that you had to write again about this.

2.

worried

I did follow up with Hong Kong your letter of 6 August. Hong Kong replied reassuringly, that they would be careful to avoid treading on HMG (or Chinese) sensitivites, and suggesting that, if still wed, we could discuss all this with Joseph Yam. Unfortunately however, in the run-up to the Prime Minister's visit, Hong Kong's reply was mislaid and the subject slipped my mind. In any event, I now attach the Information Memorandum on the bond issue for your perusal.

3.

As you will no doubt now know, the bonds being issued have only 2-3 year maturity and therefore do not have any post-1997 significance or any relation to the net borrowing limit of HK$5 billion outstanding in 1997, set out in the Airport MOU. From my, non-legal, reading of the Information Memorandum and the Loans Ordinance, I do not think there is any possible tie into HMG.

Your sincvely,

Nigel.

N J COX

Hong Kong Department

TICAEF

RESTRICTED

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