TNAG-0379-FCO40-425-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 71

CONFIDENTIAL

of Hong Kong, the United Kingdom and the other

signatories of the Sterling Agreements. It would

certainly be unhelpful to us all, including Hong

Kong, were any precipitat action to be taken.

4. To this end if (but only if) the Financial

Secretary can be virtually certain that by doing

so substantial forward sales of sterling by the

commercial banks would be avoided, we are willing

to authorise the withdrawal from the Exchange Fund by the commercial banks of a maximum of

£20 million in August 1973 and £20 million in

September 1973, these sums to be distributed

among the banks as he judges best.

5. We should be glad to talk to Haddon-Cave in

London and should be happy to see him at any time.

But we think that the best time for a visit might

be the second week in September.

CONFIDENTIAL

(10982) Dd.3920059154mK77;sorts) 1/68 G.W.B.Ltd.Gp.863

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