TNAG-0747-FCO40-951-Visits-of-Foreign-and-Commonwealth-officials-to-Hong-Kong-1978 — Page 64

香港總督府

GOVERNMENT HOUSE

HONG KONG

(59)

Der Michal

6 June 1973,

HK+G. Dept

ec: Uur. Stew that

Mur. Cortazzin

PUS

AKK026/1

? JUN 1978

in way that

Thank you for your letter of 17 May enclosing

a copy of Michael Stewart's report on his visit to Hong Kong.

We all liked Michael and respected his hard work and professional approach. I was glad, in particular, that his report included three highly pertinent points:-

a)

b)

Taken

F

That Hong Kong is unique, not only in respect of the 1997 question-mark, but in the nature of its economy. This is a point on which visitors often find locals irritatingly insistent. It can be a cloak for complacency, but it is never the less economically true, as Michael points out in his paragraph 2. Consequently the techniques accepted as normal for the management of other economies are not automatically applicable here.

The absence of a central bank here is an oddity which troubles some visitors. In point of fact, in one way or another, the Government has progressively taken most of the powers and functions of a central bank that matter (given the absence of exchange control). Michael rightly points out in his paragraph 6 that this is a situation which is evolving and acceptable. He also said he heard no complaints of potential conflict of interest arising from the Hong Kong Bank discharging some of the functions of a central bank. This is a point which from time to time I have raised with Gordon Richardson, and he has always confirmed this view.

Sir Michael Palliser GCMG

/ c)