Oleh/By		:	DATO' SERI DR. MAHATHIR BIN MOHAMAD 
Tempat/Venue	: 	ENGLAND 
Tarikh/Date 	: 	24/05/89 
Tajuk/Title  	: 	THE DINNER HOSTED BY THE BANK 
			OF ENGLAND 




 Rt. Hon. Robin Leigh-Pemberton;
Excellencies;
Ladies and Gentlemen,
    First, let me thank the Rt. Hon. Robin Leigh-Pemberton,
Governor, Bank of England for hosting this dinner for me and
the group from Malaysia, who are here on the occasion of the
official  opening  of  Bank  Negara Representative Office in
London.
2.   The   opening   of   the   Malaysian   Central   Bank's
Representative  Office  in  London should further strengthen
the already excellent relationship between our two countries
and  our  two  Central  Banks.  I  would  like to  take this
opportunity  to  thank  the  Bank  of England  for  all  the
assistance provided to us in the setting-up of Bank Negara's
Representative Office.
Ladies and Gentlemen,
3.   As some of you may be aware, way back in the 1950s, the
Bank   of   England   played   an   important  role  in  the
establishment of Bank Negara Malaysia. After all, the Watson
Caine  Report  of 1956 that led to the  setting-up  of  Bank
Negara  Malaysia in 1959 was co-authored by Mr. G.M. Watson,
who was then the head of the Overseas Department at the Bank
of England.
4.   We have, of course, come a long way since then.  One of
the recommendations of the Watson Caine Report, was that the
Malaysian ringgit should be  equivalent  to  2  shillings  4
pence,      which      was    then   the prevailing exchange
rate. Today the external values  of the  pound  sterling and
the  ringgit  vary from day-to-day, depending  on  the  mood
of  the  foreign exchange market and the shifting sentiments
of  the dealers.  Given  the  present   volatility  in   the
foreign exchange market, one cannot but  reflect on the good
old  days when Governments could fix exchange rates and they
will stay there until Governments  decided  otherwise.   How
much    easier it  was  to  do  business then.   Now one can
borrow a  million and find, the next day almost, that he has
to pay back two million. Such is the world of finance today.
5.   Notwithstanding  the  various  changes  that have taken
place  during  the  last  30  years,  I  am  told  that  the
relationship  between the  Bank    of  England  and     Bank
Negara Malaysia  has continued to strengthen and I hope that
the setting-up of the  Representative  Office in London will
help to  bring the two Central Banks even closer.
6.   Since  London  is  one  of  the  biggest  international
financial markets,  we thought  that  it  is  desirable  for
Bank Negara to  be physically present here.  It is true that
one   is   always   able  to  obtain  the  latest  financial
information through  the communication networks, but the man
on-the-spot is always able to feel the environment  and  the
mood,  and this is important.
Ladies and Gentlemen,
7.   Once again, please allow me to thank the Rt. Hon. Robin
Leigh-Pemberton, Governor, Bank of England for hosting  this
dinner  for  the  Malaysian  group,  and  I  wish  you all a
pleasant evening.