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imposes no exchange controls. The current account of
the balance of payments is normally in deficit (HK$8.4
billion in 1981), offset in whole or in part by sizeable
net inflows of private capital both direct and portfolio.
The government itself has only very minor external debt
(HK$244m at 31 March 1982) all due to the Asian Development
Bank (on which see below). This debt carries HMG's
guarantee because of the United Kingdom's responsibility
for external affairs. There is no internal direct
Government debt outstanding, but the Government has a
contingency obligation in respect of guarantees on debt of
governmental agencies of some HK$4.2 billion (Mass Transit
Railway Corporation, current figure) and HK$9.6 billion
(Home Ownership Scheme, estimated for 1986). The
effective (trade-weighted) index for the Hong Kong dollar
stood at 85.9 (December 1972-100) at end-1981,
representing a fall of 2.6% over the year.
Banking
7.
The monetary sector in Hong Kong comprises some 123
licensed banks and 360 deposit-taking companies. As at
end-1981 total liabilities of the sector amounted to
HK$633 billion, of which HK$272 billion was Hong Kong
dollar-denominated, the remainder representing offshore
business. Hong Kong dollar-deposit liabilities amounted
to HK$143 billion. Hong Kong's offshore banking business
has developed rapidly in recent years, aided by the freedom
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