TNAG-0337-FCO40-373-Visit-of-the-Chancellor-of-the-Duchy-of-Lancaster--Sir-Geoff-1972 — Page 10

6.

- 3

On sterling there was some discussion of the steps that led up to the British float. Mr. Rippon emphasised that the sudden movement of vast capital sums, and the disequilibrium caused by this to the world monetary system and individual currencies, pointed to the urgent need for a reform of world monetary practices. The Community was already playing an important role in this field. Steps in the direction of

monetary union did not immediately affect the present sterling agreement with Hong Kong, nor

had these agreements played a part in the negotiations for accession. There were no immediate alterations necessary in the agreement because of enlargement.

7.

In further discussion several of those

present pointed out that, despite their apparent advantages in Hong Kong British oriented, business and administrative practices - the commercial performance of the U.K. in the Colony had been most disappointing recently. British businessmen appeared not to recognise the importance of Hong Kong as a market and shop window for East Asia. Despite its small population its potential as a buyer of Western goods was high. Mr. Rippon took this point but wondered whether the advantages claimed for British business in Hong Kong were in fact as great as was made out. Great emphasis

was made, at this point in the discussion, on