TNAG-0379-FCO40-425-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 223

Registry No. DEPARTMENT

SECURITY CLASSIFICATION

Top Secret

Secret

Confidential

Restricted

Unclassified

* Date and time (G.M.T.) telegram should

reach addressee(s).

PRIORITY MARKINGS

(Date)

Flash

Despatched

}

Immediate

Priority Routine

PRIVACY MARKING

In Confidence

[Sec

[Security classification"

-if any

En Clair.

[

Privacy_marking -if any

]

CONFIDENTIAL

Code

Cypher

Draft Telegram to:-

No.

HONG KONG

(Date)

And to:--

[Codeword-if any]

Addressed to

telegram No..

No..............

And to

repeated for information to

Saving to...........

ORWELL

HONG KONG

(date)

YOUR TELNO 188: STERLING AGREEMENTS

Repeat to:-

1.

Saving to:-

We recognise the difficulty in which you have

been placed through the recent changes in the inter-

national monetary situation and the fact that in

Hong Kong dollar terms there has been an increased

loss based on current market rates on your sterling

though, since the only practicable

reserves

-

alternative reserve currency would have been US

dollars, a larger holding of these would have

involved even greater loss.

Distribution:-

2.

Copies to:-

Unfortunately, the constantly changing.

situation which has, as you will have seen, involved

some discussion of the future of the sterling

balances has further complicated the process of

consideration of the arrangements which might follow

the expiry of Sterling Guarantee Agreement. We have

very much in mind the difficult decisions with which