TNAG-1839-FCO40-2614-House-of-Commons-Select-Committee-on-Foreign-Affairs-enquiry-1989 — Page 38

convertible currency, and the right of the Hong Kong authorities to

manage the Exchange Fund (which provides the backing for the note

issue and is used to regulate the exchange value of the currency).

Section VIII: Shipping

This section preserves Hong Kong's position as a major shipping

centre by providing for the continuation of the existing systems of

shipping management and regulations. It stipulates that Hong Kong

will have its own Shipping Register, and provides that merchant

shipping will have free access to Hong Kong ports.

Section IX: Civil Aviation

An

This Section provides for the maintenance of Hong Kong's role as a major centre of regional and international air services. important provision is that all scheduled air services touching the Hong Kong SAR which do not touch the mainland of China will be regulated by separate agreements concluded by the SAR Government. The SAR Government will be given specific authorisation by the Central People's Government to negotiate its own bilateral air services arrangements. It will enjoy autonomy in many civil aviation matters (e.g. licencing local airlines, maintaining its own aircraft register). There will thus be continuity of civil aviation

legislation.

Section X: Culture and Education

This section makes clear that Hong Kong will continue to be able to operate its own distinct system of education separately from that in other parts of China. It ensures that Hong Kong will continue to enjoy a varied cultural and intellectual life after 1997.

Section XI: External Relations

The importance of this section is that it brings out the fact th while defence and foreign affairs are the responsibility of the Central People's Government, the Hong Kong SAR will manage on its own certain aspects of its external relations, particularly in the