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"Insofar as the two currencies, the two monetary systems and the two monetary authorities are concerned, one does not have precedence over the other, one is not superior to the other and one does not take instructions from the other," said Mr Yam.
These messages on monetary autonomy were reinforced by Mr Chen who revealed the seven principles governing the monetary relationship between Hong Kong and the mainland in a speech referring to China's policy on a crucial aspect of Hong Kong's future.
These seven principles are:
*
The Hong Kong dollar will be treated as foreign currency in the mainland while the Chinese Renminbi will be treated as foreign currency in Hong Kong reflecting the mutual independence of the two currencies after 1997.
HKMA and PBỌC will remain two mutually independent monetary authorities after 1997 and PBOC will not take the place of HKMA or set up an office in Hong Kong.
HKMA and PBoC will continue to co-operate in prudential supervision of banking institutions according to international rules and practices.
PBOC will fully support the currency stability of the Hong Kong dollar and that PBOC stands ready to use its foreign reserves for this purpose if
necessary.
The claims and liabilities between banks and companies from the mainland and those in Hong Kong will continue to be regarded as external claims and liabilities after 1997.
Mainland financial institutions in Hong Kong will not receive any preferential treatment before or after 1997.
Shanghai will not replace Hong Kong as an international financial
centre.
Mr Chen also predicted that Hong Kong will continue its role as the most important funding centre for China and very likely for the Asian region as a whole.
End