TNAG-1768-FCO40-2522-Hong-Kong-and-the-Multilateral-Investment-Guarantee-Agency-(-1988 — Page 67

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Сердик

FROM A C Higginbottom

DATE

10 FEBRUARY 1988

26

Mr Hill

Hong Kong Department

Dear or Hill

MIGA: HONG KONG

нистог

FF

B 1988

21

10.

1. You will have by now received Mr Grainger's minute of 3rd February on this subject, in response to Hong Kong telex 321, copied to us. You should

also have seen the World Bank's comments on our proposal to exclude the

dependent territoties from MIGA at the outset pending written notification

to the contrary. As Mr Grainger points out, the Bank's response does not

completely rule out problems with this approach although these are not

likely.

2. Mr Grainger concludes that it would be advisable to consult the PRC as

soon as possible. We agree.

We would prefer to include Hong Kong in the

UK's ratification of the MIGA Convention from the outset if at all

possible. If this is not possible, only then will we follow the ICSID

formula; ie ratification followed by lifting exclusion of the dependent

territories shortly afterwards. For wider policy reasons we cannot afford

to delay ratification while these matters are decided upon.

3. I should make it clear at this stage that simply including Hong Kong

under the UK's ratification will not mean that investments in Hong Kong can

be covered by MIGA policies immediately. For this to happen, Hong Kong

• will have to be designated a developing country for the purposes of MIGA.

This designation can only be granted by the Board of Directors, which does

not, as yet, exist. There would therefore, inevitably, be at least a short

delay between ratification and extension of eligibility for insurance cover

to investments in Hong Kong.