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REGISTER OF SHIPPING
21. The DTI have been discussing for some time the
possibility of a separate Register for Hong Kong,
which might enable Hong Kong owners to transfer an
acceptable number of ships to Hong Kong from flag-of-
convenience countries. A DTI team is at present in
Hong Kong and Japan dealing with questions of manning
and safety standards. Again it would have a marked
effect if agreement could be announced during the
January visit. But this will not be easy as the team
will not return to the UK until just before Christmas.
MASS TRANSIT SYSTEM
22.
A rather different question, in which we are
the demandeurs, is the contract for an underground
railway system for Hong Kong, whose initial stages
are worth about £400 million. The leading contenders
are a Japanese consortium and an Anglo-Italian Group
which has the full backing of HMG, including export
credits equivalent to a subsidy of £20 million. A
Japanese preemptive bid has already been validated for
negotiation by the Hong Kong Government. The first
Anglo-Italian proposals were rejected as inadequate,
in particular because they did not meet Hong Kong's
requirement of a fixed price. The Group have agreed
to improve their offer and its presentation in time
to meet Hong Kong's deadline of 2 December. The
Governor is fully aware of the political implications
of being left with only a Japanese bid for such an
important contract. The DTI, with FCO and Treasury
support, have done everything possible to help the
Anglo-Italian Group get their offer into shape.
We
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/cannot