No new aid committed by the HKSAR Government

A spokesman from the Hong Kong Monetary Authority said today (Thursday) that the Administration had not made any new financial commitment in respect of aid to other nations in their economic adjustments. The HKSAR Government has participated only in the financing package organised by the International Monetary Fund (IMF) in 1997 for Thailand.

The spokesman was commenting on certain misunderstandings about Hong Kong making donations to Asian nations.

When the IMF organised a financing package for Thailand in August 1997, the Hong Kong SAR committed to make a swap facility of up to US$ 1 billion available to Thailand. This is in effect a loan facility that attracts a market interest rate payable to the Hong Kong Monetary Authority.

The participation in the financing package for Thailand was decided by the Financial Secretary Mr Donald Tsang, as Controller of the Exchange Fund as part of Hong Kong's commitment to regional monetary stability.

"It is in Hong Kong's interests as a leading financial centre in the region to have a strong and stable neighbouring environment. Our participation in the IMF financing package underscores that commitment," said the spokesman.

The Financial Secretary had consulted the Exchange Fund Advisory Committee (EFAC) on the general policy of participating in multilateral facilities. The Administration had also explained to the Legislative Council about the financing package.

The Exchange Fund Ordinance empowers the Financial Secretary to use the Exchange Fund for the strategic purposes specified in the Ordinance, in particular those concerned with the currency's exchange value.

Hong Kong Monetary Authority

19 November 1998