TNAG-2126-FCO40-3036-Investment-in-Hong-Kong-1990 — Page 25

Rt Hon Michael Heseltine MP

House of Commons

London SW1

1. Thank you for your letter of 5 March and the attachments

which question the reply to your PQ on 20 February on the value

of UK assets in Hong Kong.

2. Of course I accept that I was only able to give a partial

estimate of the UK's total assets in Hong Kong. This was made

absolutely clear in the answer. In particular, as the

correspondence notes, the available figures relate to the book

value rather than to the market value of direct investment; and

we have no estimate of UK portfolio investment in Hong Kong

(though this could be substantial). I do not however accept that

there was anything inaccurate, irrelevant or methodologically

incorrect in the information I gave.

3. The figure of the book value of UK direct investment was based

on information supplied by companies under statute for the Census

of Overseas Assets 1987. This triennial survey was conducted by

the Statistics Division of the Department of Trade and Industry

but, following the reorganisation of government statistics last

year, is now the responsibility of the Central Statistical

Office.

4. I am enclosing a copy of the article which announced the

results of this survey and which was published in British

Business last September. This gives details on how the figures

are compiled. In particular I would highlight:

i

the figures relate to the book value of overseas