TNAG-0380-FCO40-426-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 82

DOLLAR HOTI TED EACH

CONFIDENTIAL

ORKING DAY DY THE BANK OF ENGLAND TO THE INTERNATIONAL META. Y FUND FOR THE PURPOSES OF FUND TRANSACTIONS **THE AVERAGE ATE') IS LOWER THAN THE AVERAGE OF THE STERLING/ UNITED STATES DOLLAR RATE IN LONDON AT NOON ON 4, 5 AND 6 SEPTEMBER 1973, IZ: WITED STATES DOLLARS 2.42:3 EQUALS POUNDS STE LIL 1 (THE GUARANTEE RATE'').

M THUM STERLING HOLDING

3. THE QUARANTEE IS GIVEN ON CO. DITION THAT OF. ICIAL STERLING

RESER ES ARE AINTAINED THROUGHO T THE PE.IOD THAT THE PRO ISTONS

1

OF THIS DECLARATION ARE IN EFECT AT OR AD WE AN AMOUNT EQUAL TO WHICH EVER IS THE LOWER OF THE FOLLOWING AMOUNTS, NAMELY

(A) THE AMOUNT NECESSARY TO MALIIT IN THE MINIMUM STERLING PROPOR- TION FIXED FOR THE PURPOSES OF THE STERLING AGREEMENT: OR

(B) THE AMOUNT DERIVED BY APPLYING THE MINIMUM STERLING PROPORTION FIXED FOR THE PURPOSES OF THE STERLING AGREEMENT TO TOTAL OFFICIAL EXTERNAL RESERVES HELDT 24 SEPTE BER 1973,

BALANCES ELIGI LE FOR GUARANTEE

4. THE GUARANTEE WILL APPLY TO THE BALANCES ELIGIBLE FOR GUARANTEE 12OR THE STEALING AGREEMENT AT THE CLOSE OF BUSINESS IN LONDON ON 24 SEPTEMBER 1973 OR ON THE LAST ORKING DAY OF MARCH 1974, WHICH EVER ARE LOVER. ELIGIBLE DALANCES ARE THE BALANCES THUS

LIGTLE FOR THE GUARANTEE AFTER DEDUCTION OF FORWARD SALES OF STERLING APART FROM THOSE IN COVER OF FORWAR. COMMITENTS ENTERED

TO WITH LOCAL DESIDENTS,

IMPLEMENTATION

5.

1) THE MOUNT DUE UNDER THE GUARANTEE ILL BE CALCULATED ON THE CASTS OF THE DIFFERENCE BETWEEN THE AVER GE RATE AND THE GUARANTEE

RATE.

(2) PAYMENT OF THE AMOUNT DUE WILL BE EFFECTED IN STERLING TO THE ACCOUNT STIPLUATED FOR THE PURPOSES OF THE STE LING ACREEMENT AS COON AS THE AMOUNT HAS BEEN AGREE? BETVCEN THE BANK OF ENGLAND AND THE COVERNMENT OF HONG KONG OR ITS AGENT,

ADVICES

6. (1) IN O DER TO BE ABLE TO BENEFIT FROM THE GUARANTEE, ADVICES,

2

3 /SUBMITTED IN

CONFIDENTIAL

!