TNAG-1768-FCO40-2522-Hong-Kong-and-the-Multilateral-Investment-Guarantee-Agency-(-1988 — Page 24

CONFIDENTIAL

FM FCO

TELNO 1953

TO IMMEDIATE HONG KONG

OF 22153OZ JULY 88

CONFIDENTIAL TOP, COPY

HKC 102

€ 102/1

RECEIVED IN SE!

25 JUL 1988

57

101436

MDHOAN 1006

See (59

IME

ewn S

INFO ROUTINE UKREP JLG HONG KONG, PEKING

B.Y, 24/7 Pl

pl. Cε 26/7

HONG KONG AND MIGA

1.

THE SECOND MEETING OF MIGA'S BOARD OF DIRECTORS IS DUE TO

TAKE PLACE ON 7 SEPTEMBER. THE LEAD DEPARTMENT HERE ON MIGA THE ODA, HAVE SUGGESTED THAT, AT THAT MEETING, THE UK SHOULD SEEK DEVELOPING MEMBER COUNTRY (DMC) STATUS UNDER THE TERMS OF MIGA

FOR THE TEN DEPENDENT TERRITORIES WHO HAVE ALREADY EXPRESSED A

WISH TO RECEIVE THAT STATUS: THIS INCLUDES HONG KONG. WE RECALL FROM OUR EXCHANGES PRIOR TO CONSULTATION WITH THE CHINESE THAT

YOU WISH HONG KONG SHOULD HAVE DMC STATUS.

2 =

THE ODA HAVE ASKED FOR SOME DEFENSIVE BRIEFING TO BE MADE AVAILABLE IN CASE THE UK EXECUTIVE DIRECTOR IS CHALLENGED ABOUT

THIS REQUEST. IN RESPECT OF HONG KONG, THE ODA HAVE COMMENTED THAT THEY BELIEVE THE US EXECUTIVE DIRECTOR MIGHT OPPOSE DMC

STATUS FOR HONG KONG BECAUSE OF AMERICAN IRRITATION ABOUT TRADE IMBALANCES WITH HONG KONG AS ONE OF THE ASIAN DRAGONS. THEY

SUGGEST COUNTERING THIS ARGUMENT BY POINTING OUT THAT OTHER

DRAGONS (EG KOREA AND SINGAPORE) ARE SHOWN IN THE CONVENTION AS

CATEGORY 2 COUNTRIES (IE DEVELOPING MEMBER COUNTRIES).

(OPEN SQUARE BRACKETS) KOREA IS A MEMBER OF MIGA AND IS A MEMBER

OF MIGA AND IS A MEMBER OF THE ASIAN CONSTITUENCY OF THE EXECUTIVE BOARD, (WHOSE EXECUTIVE DIRECTOR IS AN INDONESIAN). SINGAPORE IS NOT YET A MEMBER OF MIGA. (CLOSE SQUARE BRACKETS). SINCE OTHER ASIAN DRAGONS HAVE DMC STATUS, THERE IS NO GOOD REASON WHY THE BOARD SHOULD DISCRIMINATE AGAINST HONG KONG.

WE HAVE BEEN ASKED:

3

(I)

TO PROVIDE ADDITIONAL ARGUMENTS IF POSSIBLE, THE CASE FOR HONG KONG TO BE TREATED AS A DMC: AND

(II)

SUPPORTING

FOR ANY OTHER AVAILABLE EVIDENCE OF AMERICAN ANTIPATHY TO HONG KONG BECAUSE OF TRADE IMBALANCES, AND HOW THAT IS DEALT WITH.

4. IT HAS ALSO BEEN SUGGESTED THAT THE UK EXECUTIVE DIRECTOR

SHOULD INFORM THE PRC EXECUTIVE DIRECTOR IN ADVANCE OF THE

MEETING OF OUR INTENTIONS.

5. WE WOULD BE GRATEFUL FOR ANY INFORMATION AS REQUESTED ABOVE AND ANY OTHER COMMENTS YOU MAY HAVE, IF POSSIBLE BY 29 JULY IN ORDER FOR US TO MEET OUR DEADLINE FOR A REPLY.

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CONFIDENTIAL