TNAG-2515-FCO40-3669-Future-of-Hong-Kong-International-Rights-and-Obligations-Sub-1992 — Page 171

CONFIDENTIAL

Ака

031

1/9

の

042312

MDHIAN 0947

CONFIDENTIAL

FM HONG KONG

TO IMMEDIATE FCO

TELNO 253

OF 28110OZ JANUARY 92

PERSONAL FOR RICKETTS, HKD.

RICKETT

сл

TOP COPY Q DIST?

FROM GOVERNOR.

YOUR TELNO 109: 1997 IMF ANNUAL MEETING.

پھر

YOU ARE RIGHT IN DETECTING A CERTAIN HESITATION HERE ABOUT THE IDEA OF A 1997 IMF MEETING IN HONG KONG. IN ADDITION TO YOUR CAREFUL KREMLINOLOGICAL READING OF THE TELEGRAMS, OUR PEOPLE HAVE TOLD PERETZ THAT WE WERE LOOKING AT THIS AGAIN.

2. TWO BASIC PROBLEMS ARE APPARENT NOW IN A WAY WHICH WAS NOT THE CASE WHEN WE FIRST EMBARKED ON THIS EXERCISE. FIRST THE COST, AT SOME HK DOLLARS 200M AT PRESENT DAY PRICES, IS VERY SUBSTANTIAL (AND WE HAVE TO LOOK AT THIS AGAINST THE BACKGROUND OF LEGCO FINANCE COMMITTEE RECENTLY QUERYING THE VERY SMALL AMOUNT WE WILL SPEND ON AN ADB MEETING THIS YEAR). SECONDLY, IT IS NOW MUCH MORE APPARENT THAN IT WAS THAT, WITH HONG KONG'S MEMBERSHIP OF THE IMF BEING SUBORDINATE TO THAT OF THE SOVEREIGN STATE, THERE IS A RISK THAT HOLDING THE MEETING HERE IN 1997 WILL FINISH UP NOT/NOT BY UNDERLINING HONG KONG'S FINANCIAL AUTONOMY BUT INSTEAD CHINA'S SOVEREIGNTY. THERE IS ALSO OF COURSE THE ARGUMENT ABOUT THE IMMENSE AMOUNT OF ADMINISTRATIVE EFFORT INVOLVED AT A TIME WHEN THERE WILL BE MANY OTHER PRIORITIES: BUT WE WERE ALWAYS AWARE OF THAT ASPECT.

3. ON THE OTHER SIDE OF THE ARGUMENT, A MAJOR INTERNATIONAL MEETING HERE IN 1997 COULD BE A SIGNIFICANT BOOST FOR HONG KONG

IN ITS NEW STATUS. WE ALSO HAVE TO FACE THE REALITY THAT WE ARE ALREADY A GOOD WAY DOWN THE TRACK (FURTHER IN MANY WAYS THAN WE WOULD LIKE), AND THAT WITHDRAWING NOW COULD SEND A GREAT MANY WRONG SIGNALS.

4. WE DISCUSSED THE WHOLE MATTER IN EXCO TODAY. THE RESULT IS THAT WE THINK WE SHOULD APPROACH THE MATTER POSITIVELY, BUT IN A WAY WHICH WILL MAKE THE ADMINISTRATIVE ARRANGEMENTS MANAGEABLE AND SERVE TO HIGHLIGHT, RATHER THAN UNDERMINE, THE MESSAGE ABOUT THE HONG KONG SAR'S FINANCIAL AND ECONOMIC AUTONOMY UNDER THE JOINT DECLARATION.

1

PAGE CONFIDENTIAL