5
SATURDAY, OCTOBER 24, 1987
SIR DAVID: ON
PROTECTIONISM,
OPERATE VERY
I'M SURE YOU KNOW THE U.S. ADMINISTRATION IS VERY SUPPORTIVE INDEED OF A PLACE LIKE HONG KONG WHICH IS FREE TRADING. WE ARE THE EXAMPLE OF WHAT THEY WANT OTHER PEOPLE TO DO. SO I FOUND AN EXTREMELY GOOD REACTION FROM THE ADMINISTRATION. FROM MEMBERS OF CONGRESS, I FOUND A REAL UNDERSTANDING OF AND SYMPATHY FOR HONG KONG AND FOR THE EXAMPLE THAT HONG KONG SHOWS OF HOW A FREE MARKET CAN OPERATE AND SUCCESSFULLY. I HAVE TO SAY THOUGH, THAT THE PROBLEM OF IN GENERAL IN THE UNITED STATES IS STILL THERE. THERE THAT IT IS A BIG POLITICAL ISSUE WITH A GOOD DEAL OF POLITICAL PRESSURE BEHIND IT. ON VIETNAMESE REFUGEES, I WAS EXPLAINING THE PROBLEM AS SEEN FROM HONG KONG ΤΟ THE ADMINISTRATION AND CERTAIN PEOPLE IN CONGRESS AND GOT A VERY SYMPATHETIC AND UNDERSTANDING HEARING.
PROTECTIONISM IS NO DOUBT
QUESTION (INAUDIBLE).
WAS
SIR DAVID: I WASN'T ASKING FOR PROMISES ON ANYTHING, OUTLINING THE SITUATION AS WE SEE IT AND I GOT EXACTLY THE SORT OF RESPONSE THAT I WAS LOOKING FOR.
QUESTIONER: ONE LAST QUESTION. (LAUGHTER). I'M SORRY. HAS HONG KONG EXPERIENCED ANY PRESSURE FROM THE U.S. MARKET to DEVALUATE HONG KONG DOLLARS VERSUS V.S. DOLLARS? IN ORDER TO DEAL WITH THIS SURPLUS.
HAS BEEN REFERRED TO AGAIN I POINTED OUT THAT WHEN WE DID IT AT A TIME OF GREAT
SIR DAVID: IT'S THE OTHER WAY ROUND. THERE IS NOT PRESSURE, BUT THERE HAS BEEN A SUGGESTION THAT HONG KONG SHOULD UP ITS RELATIONSHIP. IT CAME IN A SPEECH MADE BY MR BAKER (U.S. TREASURY SECRETARY) IN THE IMF MEETING AND THAT DURING THE COURSE OF MY DISCUSSIONS. L'EGGED TO THE U.S. DOLLAR IN 1983, WE UNCERTAINTY ABOUT THE FUTURE POLITICALLY AND CONSIDERABLE TURMOIL ECONOMICALLY, PARTICULARLY IN THE MONEY MARKETS. WE DIDN'T PEG TO GET ANY TRADING ADVANTAGE. INDEED, IN THE PERIOD IMMEDIATELY AFTER WE UGGED, WE WENT UP WITH THE U.S. DOLLAR, SO WE WERE LOSING TRADING ADVANTAGE. SINCE THEN WE'VE COME DOWN WITH THE U.S. DOLLAR. BUT AS I WAS ANSWERING AN EARLIER QUESTION, WE HAVE NOT WIDENED OUR TRADE GAP AS A RESULT, WHEREAS SOME OTHER PLACES WHICH HAVE CHANGED THEIR EXCHANGE RATE HAVE ACTUALLY WIDENED THE TRADE GAP WITH THE UNITED STATES. SO, I EXPLAINED THAT FIRST OF ALL WE DIDN'T PEG FOR TRADING ADVANTAGE, SECONDLY, WE BELIEVE THE PEG IS IMPORTANT TO U8 FOR STABILITY AND THEREFORE, THIRDLY, WE DID NOT INTEND TO CHANGE THE PEG. SOMEBODY ELSE HAD ONE OTHER LAST QUESTION.
QUESTIONER:
+
J
ECONOMIC
ASIDE FROM THE EVIDENCE OF SELF-INTEREST, FOR EXAMPLE IF CHINA WERE TO GO ON ANOTHER IDEOLOGICAL ROLLER COASTER, SOME OTHER CULTURAL REVOLUTION, WHAT EFFECT WOULD THAT HAVE ON THEIR WEIGHING OF THE ECONOMIC INTEREST
TO PERHAPS CHANGE THINGS IN ADVANCE OF THE FIFTY YEAR TERM?
'SIR DAVID: