TNAG-0448-FCO40-513-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1974 — Page 225

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So what I should now find very helpful would be an indication of the views of the Hong Kong Government about the amounts of sterling which they might wish to diversify over a périod of say 2 or 3 years, and the extent to which they would be prepared to enter into informal understandings with us about the way in which this diversification would be handled. I think I ought to emphasise in all this that we should not necessarily be seeking to inhibit diversification, but simply to ensure that taking the holders across the board, diversifica- tion is not conducted in such a way as to cause significant disturbance in the exchange markets or to add unacceptably to the UK's financing requirement.

I am writing to you very much at this stage on a personal basis. No doubt, you will need to consult one or two other people, but I am sure you will recognise the extreme importance of complete confidentiality at this stage.

Happy New Year

Tumis

CUY

SECRET AND PERSONAL

will Savalt

FR BARRATT

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