HONGKONG'S robust financial position has shown further strength with the size of the Exchange Fund jumping an impressive 22 per cent to stand at $287 billion at the end of 1992. The territory leapfrogged France and Italy to become the 10th biggest holder of foreign currency reserves in the world. The fund leapt from US$29 billion worth of foreign currency at the end of 1991 to US$35 billion last December. Financial Secretary Hamish Macleod also revealed in the Legislative Council yesterday that the fund had earned another $8 billion, taking accumulated earnings to $107 billion. ''I am sure members will agree that these are very impressive figures,'' he said. The holdings at the end of 1992 translates to US$6,000 for every man, woman and child in the territory, compared with US$4,962 at the end of the previous year. Hongkong remained second only to Singapore, whose holdings were US$14,451 a head. But the corresponding average for the Organisation of Economic Co-operation and Development (OECD) countries had fallen from US$740 a head at the end of 1991 to US$700 last December, he said. This is the second year that the Financial Secretary revealed the Exchange Fund figures. Mr Macleod reiterated that the disclosure of what had long been the Government's best-kept secret was meant to bolster the transparency of the fund. There had been suggestions that the Exchange Fund should be used to help finance Government infrastructural projects. But Mr Macleod said that only the ''fiscal reserves element of the Exchange Fund is available to be drawn upon, prudently, to meet public expenditure''. He said that fiscal reserves last December stood at $104 billion, of which $96 billion had been placed with the Exchange Fund. Mr Macleod also stressed that the primary role of the Exchange Fund - 95 per cent of which is foreign currency - had always been to safeguard exchange rate stability. ''It will remain so in the future,'' he added. Independent legislator Vincent Cheng Hoi-chuen said this ''very good balance sheet'' would show the strength of Hongkong's public finance position to foreign agencies that are concerned about its viability after 1997. Mr Cheng said the territory deserved a much better rating than some rating agencies might have suggested, because the economy is still growing quite healthily. But United Democrat legislator Dr Huang Chen-ya said the public should not be overjoyed by the 22 per cent boost in the Exchange Fund. He noted that this year's growth in accumulated interest, at about eight per cent, was slower than the 20 to 30 per cent growth of the previous two years. ''Instead of welcoming the increase, we should look at the amount of development that has taken place in the territory, and question why there has not been even greater growth in the reserves,'' he said. But Liberal Party legislator Henry Tang ying-yen said there was no need to worry about the slow-down. ''I don't think the Exchange Fund should be expanding all the time. If it does, it implies that the Government has been trying to save money rather than spending it on improving people's living.''
