TNAG-2027-FCO40-2889-Hong-Kong-freezing-of-Kuwaiti-and-Iraqi-assets-1990 — Page 66

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PERSONAL FOR ACTING GOVERNOR FROM MARSDEN, HKD

FREEZING OF KUWAITI/IRAQI ASSETS: POSSIBLE DISPOSALS IN HONG KONG

BEFORE IMPLEMENTATION OF THE FREEZE

1.

WE HAVE NOTED PRESS SPECULATION THAT ONE OF THE REASONS FOR THE

LARGE DROP IN SHARE PRICES ON MONDAY 6 AUGUST (249 POINTS) WAS BECAUSE THE IRAQI GOVERNMENT WAS ABLE TO DISPOSE OF KUWAITI ASSETS IN HONG KONG. HENRY KESWICK HAS ALSO BEEN IN CONTACT WITH ME TO COMPLAIN THT THE DELAY IN FREEZING KUWAITI ASSETS IN HONG KONG HAD

CONTRIBUTED TO THE FACT THAT SHARE PRICES THERE FELL MORE SHARPLY

THAN IN OTHER MARKETS.

2.

IN CASE KESWICK REVERTS TO THIS SUBJECT WE WOULD BE GRATEFUL FOR YOUR ASSESSMENT AS TO WHETHER ANY SUBSTANTIAL KUWAITI HOLDINGS WERE IN FACT DISPOSED OF BEFORE THE FREEZE WAS IMPLEMENTED.

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