CONFIDENTIAL
4. With this last element in place, we have a setting which would not disgrace a second-rate Greek tradgedian. The Financial Secretary is in a difficult position. He almost certainly needs help; but is almost certain to bite the helping hand. Almost inevitably, moreover, any discussions about possible reforms of the monetary organisation in Hong Kong will get entangled with Sterling Agreement questions.
5. Nevertheless, there are I believe ways round this problem. If, for example, the Hong Kong Government could be brought to accept that there was merit in having a study made of their monetary organisation, perhaps they would be willing to have such a study mounted by the IMF?
Subject
6. But this is running ahead of the game. to your views, and those of other recipients of minute, I would propose to write to Mr Fogarty to the effect that we welcome this paper; that we think that the issue s it raises are important and will require delicate handling; that we have to consider how all this ties in with whatever is proposed in the Sterling Agreement context; and that we would be glad to participate in the discussion proposed by Stanley Payton.
5 July 1973
oc Mr Marshall
Mr Stuart (HK&IOD)✓
Miss Pestell (FRD)
CONFIDENTIAL
D G Holland
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