10. Than Er Forsyth noted that no one contractor er supy:15.ør take joint and several responsibility for a project of this sise, that the Department would want to look into contractual responsibilit pretty early stage of negotiations, but not until clearer details of th sise, soope and value were available.
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11. Mr Deacon pointed out that there was very real doubt as to the relative priority which the Hong Kong Government attached to this project vis-a-vis other development and social expenditure. Mr Forsyth said that antt-Underground lobbyists were already in operation (e.g. the owners of the tramways and Tunnel).
12. In summing up, Mr Wilks said that if Rothschilds wished to talk to the Hong Kong Authorities in general terms they should bear in mind that he had not committed the Department in any way. He was not able or willing to give or approve a position or proposition which would enable Rothschilds to put a firm package to the Hong Kong Government. This seemed premature and the benefits of such a moTE were dubious. He had explained what he expected to be able to get approval for. If any formal or official enquiry were to be made by the Hong Kong Government on possible UK credit support, the Department would see what kind of forthcoming. answer could be firmed up. Rothschilds could indicate to the Hong Kong Authorities that the UK was very interested in the project and was prepared to consider credit favourably and that they (Rothschilds) understood that HMG had already made these points known to the Hong Kong Government. He agreed that, in general terms, it was probably true that the bigger the UK package, the better the terms would be. But this should not be taken too literally. A contract of, say, £300 million would need very careful examination indeed.
13. Overall, once things began to firm up the Department could be relied on to be as helpful and forthcoming as the then prevailing circumstances would permit.
Distribution
Mr Wilks
Mr Cotterill
Mr Reidy
Mr Paxman
Mr Johnson
Mr Coggins
Mr Blackburn
Mr F Toms (DTI)
Mr R Jones (Treasury)
Mr E O Laird (FCO)
Mr J M Willson (FCO)
Mr J K Blackwell (Hong Kong)
File (2 copies)
M G STEPHENS 12th March, 1971
606
6699.