TNAG-0380-FCO40-426-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 22

while he had been the Minister responsible

in the Foreign and Commonwealth Office, but

implied that otherwise few people took much

interest in Hong Kong. Mr. Royle asserted

that Hong Kong, had in fact many friends in

out

this country and pointed to the considerable

important

number of very important visitors to Hong

Kong in the last few years. Hong Kong's

intelligent policy of cultivating such

id

people had pace dividends and there were

Gover

~ the

now many people in thes House of Commons and

Whitehall who could be counted as friends

of Hong Kong.

STERLING

1

3. Mr Woo said that, in their sterling guarantee

they needed more room for manoeuvre. It was not

sufficient to be able to diversify out of sterling

only 11% of their yeserves. Ideally they would like

the figure to be/50%. In addition, it would be much

better if the guarantee could be expressed in Hong

Kong dollars, rather than US dollars, but he feared

that this might cause the Treasury difficulty.

Mr Royle agreed that this might be difficult for the

Treasury. However the Governor was at present

discussing the whole issue with the Treasury, and

Mr Haddon-Cave would be able to have talks with the

Chancellor and his officials in Nairobi and Dar-es-

Saglam. The present arrangement was of course an

extension of the existing agreement. He realised

that the agreement between Hong Kong and their banks

2

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/was

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