TNAG-2360-FCO40-3431-Visit-by-John-Major--UK-Prime-Minister--to-Hong-Kong--Septem-1991 — Page 33

CONFIDENTIAL

It is difficult to predict the impact of delisting.

The possibility has been public for sometime and has

probably been largely discounted in the market. But the

Jardines Group does comprise some 10% of the market

capitalisation and their removal would affect turnover

and the status of the Exchange. Perhaps more important

is the possible ripple effect to other companies in the

same position. If Jardines were to delist it would

clearly be preferable for them to do so without attacking

the Hong Kong Government or the Governor (as Mr Keswick

has done in the past).

The matter falls entirely within the responsibility

of HKG, the Stock Exchange and regulatory authorities.

We are in close touch with HKG about it and recommend

against the Prime Minister raising it with the Governor. If asked it, he could say:

Hope that suitable arrangements for companies like

Jardines can be worked out.

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But this is a matter for Hong Kong Government, Securities and Futures Commission and Stock Exchange.

Whatever result should not, I hope, affect Hong

Kong's position as an international financial centre.

CONFIDENTIAL