XN000022-1986-07-22 — Page 2

TUESDAY, JULY 22, 1986

HK DOLLAR LINK TO U.S. CURRENCY SECURE

*****

GOVERNOR

THE GOVERNOR, SIR EDWARD YOUDE, HAS GIVEN AMERICAN BUSINESSMEN A FIRM ASSURANCE THAT THE HONG KONG DOLLAR'S LINK TO THE U.S. CURRENCY

IS SECURE.

ANSWERING QUESTIONS FOLLOWING AN ADDRESS TO THE CHICAGO COUNCIL ON FOREIGN RELATIONS ON THE LAST LEG OF HIS NORTH AMERICAN TOUR, SIR EDWARD SAID THERE HAD BEEN NO PRESSURE TO REVALUE THE HONG KONG DOLLAR UPWARDS, BECAUSE PEOPLE WANTED THE LINK MAINTAINED.

+ IT HAS GIVEN OUR BUSINESSMEN AN ELEMENT OF STABILITY IN THEIR CALCULATIONS, HE SAID, NOTING THIS WAS HIGHLY VALUABLE FOR TRADE.

THE GOVERNOR ALSO EMPHASISED THAT HONG KONG WAS A MULTILATERAL TRADER AND WITH AN AMERICAN POPULATION 50 TIMES THAT OF HONG KONG, THERE COULD BE NO PROSPECT OF A BALANCE OF TRADE IN ABSOLUTE TERMS.

WHAT HONG KONG SOUGHT, HE SAID, WAS +BILATERAL NO BARRIERS+ WITH HONG KONG GIVING U.S. COMPANIES FREE ACCESS +WE WOULD LIKE TO SEE FREER ACCESS FOR OUR GOODS+ TO THE U.S., HE SAID.

ON THE QUESTION OF SAFEGUARDS FOR HONG KONG'S FUTURE AGAINST ANY CHANGES IN PEKING POLICIES, SIR EDWARD NOTED HOW THE TERRITORY HAD EXISTED AND PROSPERED THROUGH ALMOST 40 YEARS OF ECONOMIC RELATIONSHIP WITH THE PEOPLE'S REPUBLIC, AND HAD GROWN IN VALUE TO THE MAINLAND.

HE SAID THE CHINESE AND BRITISH GOVERNMENTS HAD INVESTED A GREAT DEAL OF NATIONAL PRESTIGE IN THE AGREEMENT ON THE FUTURE OF HONG KONG, AND CHINA WAS +VERY COMMITTED TO THE STABILITY AND PROSPERITY OF HONG KONG+,

SIR EDWARD SAID HE BELIEVED CHINA WAS NOW SET ON A COURSE OF MODERNISATION AND OPENING TO THE OUTSIDE WORLD. WHILE THIS POLICY MIGHT HAVE ITS UPS AND DOWNS, HE THOUGHT THIS WAS A NATIONAL POLICY AND NOT ONLY THE POLICY OF ONE OR TWO LEADERS+.

ASKED WHETHER THE SINO-BRITISH AGREEMENT MIGHT SET SOME PRECEDENT FOR A SIMILAR ACCORD WITH TAIWAN, THE GOVERNOR SAID IT WOULD GIVE ANOTHER DIMENSION TO ENSURE THE AGREEMENT BE SEEN TO WORK.

SIR EDWARD ALSO GAVE AN ASSURANCE THAT HONG KONG'S JUDICIAL SYSTEM WOULD REMAIN ESSENTIALLY THE SAME, PROVIDING CONFIDENCE NOT ONLY WITHIN HONG KONG BUT ALSO INTERNATIONALLY WITH PEOPLE WHO HAD DEALINGS WITH THE TERRITORY.

ASKED TO GIVE THE PEOPLE OF HONG KONG A MESSAGE FROM THEIR LEADER ON HOW TO FACE THE FUTURE, HE SAID: +GO ON DOING WHAT YOU'RE DOING NOW.+

/2