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Cified & HILIL 179/1
HONG KONG: BRIEF FOR MR CORTAZZI'S VISIT
MASS TRANSIT RAILWAY
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28 APRI975
HILIL026/504/3
It was provisionally agreed at recent inter-departmental meeting that no further action should be attempted to restrict imports of woven shirts from Hong Kong but, as a quid pro quo, the Governor should be asked to use his influence to try to ensure that British firms obtain a major share of the contracts still to be let for electrical and mechanical works on the Mass Transit Railway. The Department of Industry is now considering advising Mr Varley in this sense. Mr Cortazzi has so informed the Governor in his letter of 25 April in reply to the Governor's letter of 8 April.
Of the eleven contracts put out for international tender for civil engineering and construction works and worth approximately £140 million in all, British consortium J R Keir/F J Lilley/Gammon (Hong Kong) successfully bid for two, a major station complex and a tunnel, together worth £40 million (£16-£18 million export content and backed 100% by ECGD). A greater proportion of these contracts might have been obtained if more British engineering firms had put in bids but, at present, order books are full with Middle East projects. A track laying contract worth £10 million (£71⁄2 million export content) is up for retender and one British firm, Henry Boot, in joint venture with Gammon (Hong Kong), is bidding. 3. Major contracts for electrical and mechanical equipment worth approximate y £151 million have still to be placed. GEC have co-ordinated the bids of British firms totalling £118 million of the business. The Mass Transit Authority (MTA) are at present considering the tenders and the British firms are believed to be well placed for the electrical contracts. Metro-Cammell's tender for rolling stock, however, quotes a price 15% higher than that of the Japanese and Germans. Rolling stock represents about 50% of all the E and M contracts (73 million) and apart from its value this contract would be the most prestigious as the Railway will be
Given associated in the public mind with the make of the trains. the world growth of urban railway systems, a resounding British success in Hong Kong could lead to orders in other parts of the
world over the next decade.
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CONFIDENTIAL