St.S.

66116

NOTHING TO BE WRITTEN IN THIS MAROIN

Registry No.

DRAFT

Type 1 +

HKK 21/4

LETTER

To-

From

Top Secret.

Secret.

Confidential.

Restricted.

Unclassified.

Lord Brown,

Board of Trade.

72

Lord Shepherd

Telephone No. & Ext.

Department

Enc. Flag A

Copies as in

last para.

CONFIDENT IAL

Since our exchange of correspondence last month I have been following with close interest the developments in the Hong Kong Cross Harbour Tunnel developments.

I am very relieved that, on reviewing the

situation with ECGD, you felt able to relax the terms previously offered. But I fear that it is

still too soon to be sure of the outcome of this

matter. It is presumably no more inconceivable

now than it was when you wrote your letter of

17 January that when the French do make up their

mind they will, with whatever object, soften

their terms; and there are reports

credible we do not yet know of American and

Swiss offers.

how

In these circumstances, and because of the

vital importance from our point of view of

ensuring that, if the project does go ahead, it

should do so as a British project, I have been

considering whether there is anything further

I could do to assist matters in the direction we

all want. It seems to me that there is one

step I ought to take.

To ECGD I suppose the Hong Kong Government

must be an interested party; I am almost sure

I have seen it so described in one or other of

the papers our officials have been handling.

No doubt this is a reasonable attitude for your Department to take when the Hong Kong Government is expecting to take up its share in the equity.

But in this Office, of course, we stand in quite

a different relationship with the Governor, and

I therefore propose to telegraph to Sir David

Trench

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