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MDTTAN 4747

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FM FCO

JJ 2011

1. Cogn Mr Mrm

Соди

TO

TELELETTER WASHINGTON

HKD 021/3

TELELETTER NFR

RF

OF 191216Z JANUARY 93

2 1 JAN 1993

INFO TELELETTER HONG KONG

FFICE

ISTR

INDL

**

・un Takm

2. Mr

FROM P F RICKETTS, HKD

TO S D PATTISON, WASHINGTON

INFO MARTIN DINHAM, GOVERNMENT HOUSE, HONG KONG

GINA DESPRES

1.

2.

zoli Morris

Mi Jarnes- James

Gina Despres called on me as arranged on 18 January.

As you

She explained the basis of her interest in Hong Kong. probably know, she handles investment in Hong Kong and China for Capital Research, who have enormous pension and other institutional funds under management in Hong Kong.

She was therefore interested in taking the long term view. She had found her discussions with the Governor in Hong Kong Last July enormously helpful. Knowing the thinking which underlay the Governor's approach had helped her to convince her Board to keep their nerve through the recent difficult period, and to see dips in the Hong Kong market as buying opportunities. She thought that the attitude of the major international institutions had helped to underpin the market over the last couple of months.

3.

Ms Despres is also very supportive of the Governor's approach politically. I brought her up to date on the signs of slight moderation in the Chinese approach since mid-December, speculated on the Likely causes of that, and briefed her on the outlook for the debate in LEGCO emphasising that this was likely to be a long drawn out procedure. She asked what would affect the eventual Chinese reaction to the outcome from LEGCO. I said that this would depend partly on the extent of any changes made in LEGCO, partly whether the Chinese would feel that they had had an input to the process (that was why we were ready to hold discussions with them) and no doubt partly on Chinese perceptions of attitudes in the US and other major economic partners. She asked about the effect of any leadership changes in China. I said that I thought these would not affect policy in Hong Kong in the short

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