PRINCIPAL officials-designate of the Special Administrative Region (SAR) government should have a say on how Hong Kong's foreign exchange fund is invested before 1997, a Chinese official said yesterday.
The statement follows the Government's announcement on Wednesday on the updated status of foreign exchange reserves, which stood at US$53.6 billion (HK$414 billion), a nine per cent rise on reserves at the end of 1994.
The director of the Research Department of Xinhua (the New China News Agency), Yang Huaji, yesterday attacked the Hong Kong Government, saying not only had China not been given details of the fund, but the future government of the SAR had no say on its operation.
'The Hong Kong Government should discuss the management of the fund with the principal officials-designate when they appear next year,' he said.
'Not just for the right to know, but [the designates] should participate in the investment decision-making. Otherwise what can we do if there are bad debts?' China has representatives on the Foreign Exchange Fund Consultative Committee, but he said China did not just want consultation - it wanted the right to decide on investment policy.
It was extremely important for the SAR government to understand the fund's operation, as it was the main factor stabilising the Hong Kong dollar, he said.
But China had too little information about the fund. What was published in the Government's annual report was not enough, said Mr Yang.
