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As the pre-registration that took place on 1st March related to contracts numbers 1 to 15, and as there will be further registration dates on 1st June and 1st September 1975 for substantial civil contracts, I would suggest that your members themselves or a representative, should visit us in Hong Kong in order to obtain a clearer and more accurate picture of what we have in mind, and the specific conditions to which we intend to work. As however, you have gone into detail in your letter reflecting inaccurate assumptions, it may be helpful if I comment upon the more misleading conclusions.
1.
2.
3.
Finance
I think that you should credit the Provisional Authority with a little more wisdom than to proceed with a project where the financial feasibility is very questionable. You have not perhaps appreciated that some of the more expensive sections of the Initial System from a constructional viewpoint have been omitted from the Modified Initial System, and that inflation during the past year has had the effect of increasing anticipated revenue as well as increasing costs,
•
We also believe that the project management team that is being assembled in Hong Kong will, with the assistance
of our engineering consultants, be capable of solving the same problems that would have faced any main contractor under a single contract approach.
Labour
Again, your members do not appear to be aware that there is a shortage of constructional work in Hong Kong at the present time, and that times have changed since perhaps they formed their opinions a year or so ago. Far from being chaotic and unpredictable, the present time appears to be very favourable in Hong Kong for placing civil engineering contracts, as evidenced by the considerable interest of local contractors.
Fragmentation
The situation is unlikely to be as "fragmented" as you imagine. Most of the international contractors that have registered their interest have indicated that they would like to group a number of the various civil contracts, and in principle we have no objection to this, but will make our decisions at the appropriate time on commercial and practical grounds.
!
Cont'd.
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