TNAG-1764-FCO40-2518-Hong-Kong-stock-market-and-exchange-rate-1988 — Page 92

FCO40 Hong Kong Department Records 聯邦事務部香港部檔案 All

CONFIDENTIAL

6

(c) The establishment of the Securities Review

Committee under Mr Ian Hay Davision was well

received.

(a)

There was some appreciation that Hong Kong was to

some extent only a domino caught up in world events. Moreover the crash did not adversely

affect Hong Kong's underlying economic strength.

(e)

(f)

Although Hong Kong was the only market which

actually closed, other markets were difficult to

deal in as well.

The role of the Bank of China in the rescue

operation was highlighted.

The Way Forward

9.

(a)

The return of confidence in Hong Kong will be

considerably affected by the effectiveness of new

regulatory measures. At the same time,

experienced market operators are well aware of

the difference between action and words, having

seen Congressional investigations and

Parliamentary reports etc before which came to

naught. In other words, they will be looking to

see both the SRC report itself and what HKG does

with it.

CONFIDENTIAL

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