TNAG-0379-FCO40-425-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 192

2.

-3.

Of the official reserves of the OSA the holdings of Central

Ilonetary Institutions (CMI's) about £14 billion is held in British

Government Stocks. The remainder is in bank deposits, UK Treasury

bills and other forms of banking and money market liabilities.

mns. December 1972

Govt.

Stocks

Banking & Money Mrt. Liabilities

TOTAL

Exchange reserves in sterling:-

Overseas sterling countries

Non-sterling countries

International organisation (excluding

Other banking & money market liabilities:-

1,424

1,716

3,140

13

190

203

118

135

253

IMF)

Overseas sterling countries

Non-sterling countries

1,317

970

1,317

970

1,555

4,328

5,893

3. The "private" holdings largely represent working balances con-

nected with the financing of world trade in sterling and liquid asset

of commercial banks and other institutions.

B.

1.

THE OVERSEAS STERLING AREA

Before the 23rd June 1972, when sterling floated and new Exchang

Control arrangements limited capital transfers by UK residents, the

OSA represented those countries to which sterling could be transferre

for all purposes, both capital and current, without formality. This

freedom now applies only to the Republic of Ireland, a fellow member

of EEC, and Gibraltar which has a special relationship with EEC.

2. Until 1967 the currencies of Sterling Area countries were all

related to sterling in some way, either through statutory arrangement

for the issue of currency or through the conversion of