12
The station is in
Enemy occupied
territory (see map
P.S.
It seems to me that we have got to consider
how far we are prepared to let this go. The Chinese dollar can be confidently relied upon to fall steadily in value, and so long as we go on buying Chinese dollars at the artificial official rate, the cost to Hong Kong funds will go on rising. It is a rather nice point as to whether that official rate is strictly an over-valuation of the Chinese dollar, since what we are giving the Chinese Government in exchange for Chinese currency is sterling balances which they cannot possibly make use of as they already have more sterling than they can spend. No doubt we could argue that in due course sterling would be worth something substantial, but at the moment, the process is rather one of giving the Chinese something which is virtually worthless to them in exchange for currency which is rapidly becoming worthless to anybody. Ignoring those rather theoretical considerations, however, the awkward feature of the transaction is that it is a fairly substantial drain on the dwindling cash resources of the Hong Kong Government. I presume also that the same type of thing is going on as regards the maintenance of refugees out of Hong Kong funds.
Another aspect of the situation is that the present official rate is maintained for political reasons which no doubt suit H.M.G., but it is a little hard that, in consequence of that political action, Hong Kong should suffer an official loss. If Eastern Dept. are agreeable, I should be rather inclined to put the points involved to Mr. Norman Young and see if he has any suggestions to make.
I am not clear whether the Mission is still functioning in enemy occupied territory, and, if so, whether the payment is in any case acceptable to
at 1). B. Justurtall; M.E.W. and T.W.E.
·14/7.
Inote that the question was referred to M.E.W.+T/E DENE, at 7, the they may not have noticed where the Sta, wars
UNDER STATUTE
situated. B 14/0
*KOYED
mr.Caine.
پر
12.7.43.
144496/1629/210
J
21-7-413
as this artificial exchange rate has been maintained, on a varying scale 1/2 to 2d - won by the Chinese Goot,over a period of six or eight years as a matter of policy, can we assume that it no doubt suits H.M.G. which may have little to say on the subject ?
Our own part in the geminal exchange question is comparatively small & in any
automatically transferred from to the Treasury by the bankruptcy of stong Kong - rid
case the matter is nous
54126/43
a draft! minuti on sees herewith.
I have therefore drafted a letter to the Treasury
) on the general financial question of the lepers.
A. Jos the stall.
2006/7 4/8