TNAG-0335-FCO40-371-Visits-of-Secretary-of-State-for-Foreign-and-Commonwealth-Af-1972 — Page 107

CONFIDENTIAL

(ii)

Cguarantee

guarantee naturally remains in force.

Re-fixing Sterling.

If this is raised the Secretary of State might say,

as the Prime Minister and the Chancellor of the

Exchequer have said on a number of occasions, that

we intend to re-fix sterling in due course.

INTERNATIONAL MONETARY REFORM

(i)

(ii)

The Committee of Twenty has now been set up to consider

the reform of the international monetary system as a

whole and to make recommendations to the Board of

Governors of the IMF. The important thing now is that

the Committee should be enabled to pursue this important

task as expeditiously as possible.

If the question of the future role of sterling as a

reserve asset is raised, the Secretary of State might

refer to the Prime Minister's undertaking as repeated

to the Commonwealth Finance Ministers' Conference last

month, ie that any proposals to reduce the reserve

role of sterling would have to be acceptable to

sterling holders.

Financial Policy and Aid Department

17 October 1972

2.

CONFIDENTIAL