Mr Whitehe ad
CONFIDENTIAL
19A
ICL
די
1. General Sir Charles Richardson, Government Relations Consultant, ICL, and MrCook, asked me at lunch yesterday whether we could help in any way to save ICL's position with the Hong Kong Government. Futting the matter very briefly, the Hong Kong Government have re- cently decided to adopt a long term programme to meet their data processing requirements. According to General Richardson ICL, who up till now have been the Hong Kong Government's principal suppliers of this equipment, may well lose out to IBM or Univac when the con- tracts are awarded for the equipment necessary for the new programme. If this business is lost to ICL it will probably mean exclusion from Hong Kong Government Departments for many years to come. The fact that ICL equipment was no longer used by the ong Kong Government would inevitably have a seriously inhibiting effect on ICL's pros- pects for winning new business in the private sector. It could also inhibit the Company's prospects of new long term business in China.
2. ICL admit that the equipment orrered by IBM and Univac at this stage is possibly better suited to the Hong Kong Government's long term programme, but they argue that there is no real necessity for the Hong Kong Government to take a decision now. The equipment which ICL have supplied and can supply is quite adequate for their require- ments over the next 2 or 3 years. ICL are quite confident that they themselves will be producing equipment which would fully meet long Kong's needs when the requirement arose. They hope that we might possibly be able to put this point to the Governor with perhaps the suggestion that the Hong Kong Government's data processing require- ments might suitably be looked at by a firm of outside consultants. ICL think that the consultants would endorse their view that there is no immediate urgency for the Hong Kong Government to embark on this particular programme and to order new equipment.
3. I told General Richardson that our missions overseas were always pleased to help ICL in any way they can. In the case of Hong Kong the position was slightly more complicated in that the Hong Kong Government enjoyed financial autonomy and that we would not normally attempt to influence, through the Governor, the Hong Kong Government's decision on essentially commercial matters. I said that the respon- sibility for the promotion of British commercial interests in Hong Kong rested with the British Trade Commissioner and that we would obviously have to consult him about this particular case. General Richardson replied that the matter was now very urgent and that any action, to be effective, would have to be taken quickly. He and Mr Cook doubted whether the Trade Commissioner, with whom the ICL Office in Hong Kong were in touch, would be able to exercise much influence over the Hong Kong Government officials concerned in this decision. He thought that a very discreet approach to the Governor (to whom, on a strictly Personal and Confidential basis, some hint might be given about ICL's future plans) might be the only hope. He was not sug- gesting that the Governor should be asked to direct that the orders should go to ICL, but that he should merely enquire whether it was strictly necessary for current and short term operational reasons
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CONIUGHTLAT