TNAG-1270-FCO40-1620-Financial-policy-in-Hong-Kong-1983 — Page 223

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20952

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THE NOTE MIGHT CONCLUDE THAT, IN THE ABSENCE OF ANY

SUBSTANTIAL GOVERNMENT DEBT, NO SUCH MEASURES ARE LIKELY

EFFECTIVELY TO DEAL WITH CURRENT PROBLEMS SEMI COLON

(E) POSSIBILITIES (ABOUT WHICH THERE IS PRESS SPECULATION)

FOR PEGGING OF THE HONG KONG DOLLAR IN SOME WAY. APART

FROM ITS FINANCIAL IMPLICATIONS, THIS WOULD SEEM TO BE RULED

OUT BY THE POLITICAL IMPLICATIONS FOR THE NEGOTIATIONS

WITH CHINA.

3. WE SHOULD BE MOST GRATEFUL FOR ANY PRELIMINARY

COMMENTS WHICH YOU MAY BE ABLE TO GIVE BY IMMEDIATE

TELEGRAM. THE TREASURY WOULD NOT OF COURSE PUT FORWARD

FORMAL RECOMMENDATIONS WITHOUT THE FULLEST CONSULTATION

WITH YOU. THEY HAVE ASKED ME TO STRESS THAT THE PRESENT

STUDY IS STRICTLY FOR MIND CLEARING PURPOSES AND SHOULD

NOT BE REGARDED AS SUGGESTING THAT ANY OF THE IMPLICIT

COURSES OF ACTION REFERRED TO ABOVE WOULD BE LIKELY TO

COMMEND THEMSELVES HERE. THEY WILL BE GRATEFUL TO BE

KEPT FULLY INFORMED THROUGH US OF YOUR OWN VIEWS AND

INTENTIONS.

HOWE

LIMITED

HD/HKD

P3

PS/PUS

MR GIFFARD

MR KUANS

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TOP SECRET

COPIES TO:-

MR UNWIN

H.H. TREASURY