MJ W
COMMERCIAL IN CONFIDENCE
51
Treasury Chambers
Parliament Street London SW1P 3AG
Telex 262405
Telephone 01-930 1234 ext
1143
ME Farry Esq Department of Trade
1 Victoria Street LONDON
SW1H OET
R.
Your reference
OPG300
Our reference
2FE17/68/01
Date
28 May 1975
22 23
HONG KONG MASS TRANSIT
You sent Miss Kelley a copy of your letter of 17 April to Kinnear in Hong Kong about this project, and we have since seen a copy of his reply on 29 April.
2. We are a little uneasy at the references in this correspondence to reconsideration of the position on ECGD cover. We do not contem- plate here proceeding with this business on anything other than normal commercial terms, and our correspondence with ECGD earlier this year (in particular Mrs Boothroyd's letter of 5 March and Panton's letter of 10 March) brings this out. We do not see any scope for softening the terms which we have already authorised, although I doubt if we should make interest at 81% a year an absolute sticking point.
3. We did ask ECGD to approach other credit insurers about a common pattern of terms. It would be helpful if ECGD would now say how far this consultation has got. There can, however, be no question of conceding the GEC request (reported in paragraph 6 of your letter of 17 April) for "better credit terms than its competitors".
Copies to: Mr Kinnear: Hong Kong
Mr Lowton: ECGD
Mr O'Keefe: FCO
Mr Lambert: Bank of England
I E RICH
Mr HANA
64/2