§ Mr. Hoyle
asked the Secretary of State for Foreign and Commonwealth Affairs why the Hong Kong Government have provided HK$ 1 billion to guarantee the completion of transactions on the Hong Kong financial futures exchange; and if there will be an official inquiry into the operation of the Hong Kong financial futures exchange.
§ Mr. Mellor
The Hong Kong Government considered that, in the light of the turbulent conditions affecting stock and foreign exchange markets around the world, and the effect this was having on the financial futures exchange in Hong Kong, use of the exchange fund to provide support to the Hong Kong Futures Guarantee Corporation, in conjunction with matching support from local financial institutions, was fully justified under the terms of the Hong Kong exchange fund ordinance. The Financial Secretary has said in the Legislative Council that the Hong Kong Government will be undertaking a thorough review of the stock and financial futures markets and of the Government's regulatory position. Details of this review and its terms of reference will be announced shortly.