PAGE FIVE
WE HAVE AGAIN HEARD - AS WE DID IN NOVEMBER THAT THE ITALIAN
PROPOSAL IS VERY ATTRACTIVE. BUT WE HAVE BEEN UNABLE SO FAR, TO GET ANY DETAILS OF IT. SUGGEST YOU APPROACH THEM THROUGH
BERNE UNION TO GET DETAILS OF THEIR CREDIT TERMS. FRANCO/GERMAN ARE ALSO SAID TO BE STRONG CONTENDERS. THEY APPEAR TO BE TRYING TO ENLIST SOME FURTHER PARTNERS (POSSIBLY FROM OTHER COUNTRIES) FOR THE CONSTRUCTION SIDE IN PARTICULAR BECAUSE THEY ARE ALREADY FAIRLY STRETCHED WITH CONTRACTS HERE AND FLSEWHERE. ACCORDING TO THE GERMAN CONSUL THEY HAVE NOT
YET SOUGHT CREDIT TERMS FROM HERMES. BUT WE THINK THAT THE
FRENCH MAY HAVE APPROACHED COFAS AND E.C.G.D. MIGHT LIKE TO
PRESS THEM AT LEAST AGAIN TO SEF WHAT TERMS THEY HAVE OFFERED.
WE HAVE NO FURTHER INDICATION OF JAPANESE PROPOSALS.
AT PRESENT THEREFORE IT DOES NOT LOOK LIKE IT IS ONLY A TWO
HORSE RACE ALTHOUGH F.S. MAY BE USING THE OTHER TWO AS MUCH
TO GOAD JAPANESE AND OURSELVES ROUND THE TRACK THAN AS SERIOUS
FINISHERS. HE IS CERTAINLY KEEN TO HAVE WIDEST POSSIBLE
COMPETITION AND LEAST POSSIBLE COLLUSION AT THIS STAGE. HE
IS IN A STRONG BARGAINING POSITION AND HE KNOWS IT. THE
INSERTION OF THE NEW REQUIREMENT AT (C) IN HIS LETTER IS
PERHAPS INDICATIVE OF THIS SEMICOLON IT IS THE FIRST THAT ANY
OF US HAVE HEARD OF IT.
13. NEXT STEP. I HAVE AN APPOINTMENT TO SEE HADDON-CAVE AT
4.30 PM ON MONDAY 19 FEBRUARY. I SHOULD BE GRATEFUL FOR
GUIDANCE ON WHAT I AM TO SAY TO HIM ABOUT TIMING OF TALKS IN
HONG KONG AND POINTS ON WHICH YOU WOULD REQUIRE CLARIFICATION.
I HAVE SUGGESTED A POSSIBLE LINE IN PARAGRAPH 5 ABOVE.
MEANWHILE I SUGGEST THAT ALL LIKELY TO BE CONCERNED IN THE DISCUSSION (AND THEY WILL NEED TO BE THE TOP MEN) SHOULD
CLEAR THEIR DIARIES FOR THE LAST THREE WEEKS OF MARCH.
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