TNAG-2124-FCO40-3031-Hong-Kong-Asian-Development-Bank-(ADB)-1990 — Page 14

Ms Marsden

Mr Styne

Ict's plisass

Са

Reference

HAE TOR

FROM MRS J CRADICE

TRY

DATE: 14 June 1990

199

Paul

Mr A Raul

WH 307 A

Hong Kong Dept/FCO

16

ASIAN DEVELOPMENT BANK:

POSSIBLE ANNUAL MEETING IN HONG KONG

You have already received a copy of Mr Nicholas Bailey's letter of 4 June informing us that Hong Kong has offered to host an annual meeting of the Asian Development Bank within the next few years. For ease of reference I attach a further copy.

2. The raison d'être of the Asian Development Bank is to lend money, either at near-commercial or at concessional rates of interest, to developing member countries in Asia and the Pacific. The AsDB is essentially a non-political organisation; indeed Article 36.2 of its Agreement provides that it shall not interfere in the political affairs of any member, nor be influenced in its decisions by the political character of the member concerned. Despite this provision, lending to the People's Republic of China, who joined the Bank only in 1986, has been suspended since the shootings in Tiananmen Square in June last year, ostensibly (but unconvincingly) on the grounds of an unfavourable macro-economic environment.

3. Guidelines for the location of annual meetings of the AsDB were drawn up in 1979. According to these, there should be two meetings in Manila, the Bank's headquarters, for every one meeting elsewhere. In practice there have been more away than home meetings over the past few years. We are opposed to this on grounds both of cost and disruption to the Bank's operations; but it remains to be seen whether our view will prevail.

4.

Meanwhile Mr Bailey, who will become our Executive Director on 1 July, would like our views on the possibility of the ASDB holding an annual meeting in Hong Kong. You will note from paragraph 2 of his letter that China apparently has no objection to this. For the reasons given in the previous paragraph, the ODA line would be that while we see no objection to the meeting being held in Hong Kong, we think that since the 1989, 1990 and 1991 meetings will all have been held away from Manila, the 1992 and 1993 ones should be held in Manila (unless the Philippine elections due to be held in May 1992 are deemed to make this impossible). Since France has already secured 1994 for a meeting in Nice, the first available date for Hong Kong would be 1995.

5. Before I reply to Mr Bailey, I should be grateful if you would let me know:

(a) any particular political advantages or disadvantages

from the point of view of HMG of an annual meeting of the AsDB being held in Hong Kong;