TNAG-0458-FCO40-523-Future-of-financial-and-economic-policy-of-Hong-Kong-1975 — Page 3

STRICTLY PERSONAL AND CONFIDENTIAL

Foreign and Commonwealth Office London SW1

Telephone 01-

HE Sir Murray MacLehose KCMG MBE

HONG KONG

Your reference

Our reference

Date

21 January 1975

19

"Ves

rear Damay,

FINANCIAL CONTROL

1. I enclose herewith copies of David Walker's note on his recent visit to Hong Kong and of David Holland's minute thereon. Both have agreed that I might send these to you on a Personal basis. Walker's only caveat was that he hoped that his paper would not find its way to Philip Haddon-Cave. Although Philip knew that Walker had discussed the situation with you, he did not want to give the impression of going behind the Financial Secretary's back. I gave the necessary undertaking on your behalf. I hope that was right?

2. It is interesting that the Treasury are independently thinking on the lines you have discussed with others. We have not of course told them that we have been speaking to you, and Holland has been careful not to do so in his minute. This rather Byzantine method. does, however, impose certain strains here, and if, at any stage, you decided that we could come clean with selected Treasury individuals, it would make things easier. However, the decision lies with you.

3. On substance the idea of Treasury bills does seem to be gaining ground. To a layman, however, David Walker's comment that seasonal issues would not permit a satisfactory market, does seem to make sense. Finally, I do not need to add that the FCO agree with the final sentiment in Walker's minute.

Сс

(blind) Mir Holland

You ever

Andrew

AC Stuart

Hong Kong & Indian Ocean Dept.

LAST

PAPER.