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318) 3.

317)

At the same time the Prime Minister minuted strongly to the

Secretary of State for Trade and Industry saying that it was

37 essential that we should win the contract. Mr Walker has now replied

describing the Anglo-Italian Group's latest moves and what was being

done to support them.

4.

I attended a meeting yesterday at the DTI with representatives

from the Treasury and ECGD. We agreed that action was now in the

hands of the consortium team in Hong Kong. They had had a shock

and were anxious to do everything possible to keep in the game.

There was some discussion of whether we should approach the Japanese

in case the UK-Italian bid failed. The consensus was that this could

only be a last resort. If the Hong Kong Government made it clear

to us on 2 December that our bid had failed, there would still be

time to go

to the Japanese before EXCO met on 5 December. We might

also ask the Governor to urge the Japanese to give some of the work

to us but at that stage it would only be likely to be on a

sub-contracting basis. Meanwhile it was agreed that it would be

better not to open up this unappetising possibility.

5.

I asked whether the DTI were satisfied that their Secretary

of State's latest minute fulfilled the Prime Minister's requirements.

Mr Royce said he thought so but would check with Lord Bridges.

29 November 1973

сс

Sir D Watson

Private Secretary Mr Marshall/TRED

Jest

A C Stuart

Hong Kong & Indian Ocean Dept.

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