U.S. and Hong Kong (1998)

TREASURY DEPUTY SUMMERS 1/14 HONG KONG PRESS BRIEFING

Following is an unofficial transcript of the press availability:

(begin transcript)

PRESS AVAILABILITY WITH DEPUTY TREASURY SECRETARY LAWRENCE SUMMERS

HONG KONG
JANUARY 14, 1998

SUMMERS:It's good to be here in Hong Kong. My colleagues and I had good discussions with the authorities here.

Hong Kong is a valued partner in this region, and we discussed a range of issues connected with the financial situation in Asia. We discussed the implementation of the Manila framework. And we also discussed the situation in a number of countries.

I informed Mr. Tung (Hong Kong Special Administrative Region Chief Executive Tung Chee-hwa) that the Treasury had decided to place an attache in the Consul General's office in Hong Kong, our first Treasury attache in Asia outside of Japan. That is a reflection of the special role that Hong Kong occupies as a nerve center of Asian finance, and the continuing and close relationship that the Treasury expects to have with the government of Hong Kong.

In general, I think the discussions we had were very positive and constructive, and we look forward to cooperating in the future. My sense was that the Hong Kong authorities shared our sense that what was most crucial in this situation was that countries pursue sound policies that offer the best prospect for attracting capital and restoring confidence. Let me stop there. I may answer one or two questions.

Q: How important is Hong Kong's stability to the region, particularly the Hong Kong-U.S. dollar peg, how important is that to --

SUMMERS:I think Hong Kong is, as a major financial center, very important to the region. And I continue to be impressed, as I have been on past visits to Hong Kong, that the Hong Kong authorities have very well demonstrated that they have the capacity, the determination, and the skill necessary to carry out their declared policy with regard to the exchange rate.

Q: Dr. Summers, Tung Chee-hwa told us earlier today that he was concerned about a lack of support in Congress for the IMF rescue packages. Was that a subject of your discussions today?

SUMMERS: Who said that?

Q: Tung Chee-hwa said it in an interview we had earlier today...

SUMMERS:I think that it is very important for the United States and for Asia that we have a strong IMF, and an IMF that is able to respond to whatever circumstances may develop. And that is a case that the President, Secretary Albright, Secretary Rubin, will be making with great vigor to the Congress this year. I think these issues are of profound importance. There will obviously be important issues to debate about how best to respond, but it seems to me that if economic history teaches anything, it is the importance of institutions that can seek to contain financial instability and that is a core part of the mission of the IMF.

Q: Do you agree with the IMF's apparent self-criticism in Indonesia --

SUMMERS: I don't have anything for you on that.

PRESS OFFICER:Thank you.

(end of transcript)