SECRET
XS 350
SECRET
FM HONG KONG 221038Z JAN 79
TO IMMEDIATE F C O
TELEGRAM NUMBER 150 OF 22 JANUARY
Ad d
HKK 143/2
BA LIFE? ME
FOR PUS FROM GOVERNOR.
No
मा
f
PASTA VER VEDER LINE
MASS TRANSIT RAILWAY ROLLING STOCK CONTRACT.
See @
1. THE DEPARTMENT ARE INFORMED ABOUT THIS THROUGH THE SENIOR
BRITISH TRADE COMMISSIONER'S TELEGRAMS TO THE DEPARTMENTS OF TRADE AND INDUSTRY. METRO-CAMMELL, WHO WON THE TWO PREVIOUS CONTRACTS FOR ROLLING STOCK, MATCHED THE JAPANESE PRICES FOR THIS
FINAL CONTRACT (CLEARLY WITH HMG'S HELP SINCE BOTH PRICES - WERE QUITE UNCOMMERCIAL). AT THE LAST MINUTE THE JAPANESE HAVE WAIVED
SOME INTEREST PAYMENTS THUS UNDERCUTTING THE BRITISH BID BY A
LITTLE UNDER POUNDS STERLING 5 MILLION. I AM INFORMED THIS IS
SUFFICIENTLY LEGAL FOR IT TO BE USELESS FOR US TO CRY ''FOUL'' THE DEADLINE FOR OFFERS ON PAYMENT IS THURSDAY MORNING. (1.E. CLOSE OF PLAY WEDNESDAY IN LONDON). THE OBJECT OF THIS TELEGRAM
IS TO ASK THAT IF THE DEPARTMENTS OF TRADE AND INDUSTRY ARE DISPOSED
TO RECOMMEND TO MINISTERS THAT THEY SHOULD MATCH THE JAPANESE,
THE FCO SHOULD VERY STRONGLY SUPPORT.
2. UNFORTUNATELY THERE IS NOTHING THAT I CAN DO HERE BY ARM TWISTING. THE HONG KONG, GOVERNMENT HAS RECENTLY AWARDED METRO- CAMMELL THE CONTRACT FOR ROLLING STOCK ON THE KOWLOON/CANTON RAILWAY ALTHOUGH THEIR BID WAS ABOUT 8 PERCENT HIGHER THAN THE
JAPANESE, AND WE HAD TO OBTAIN SPECIAL EXECUTIVE COUNCIL AUTHORITY.
THERE IS AN OVERLAP BETWEEN EXECUTIVE COUNCIL AND THE BOARD OF THE MTR, AND I DO NOT THINK WE CAN PULL IT OFF TWICE RUNNING AND FOR THIS SUM.
3. JAPANESE TACTICS INDICATE THE IMPORTANCE THAT THEY RIGHTLY
ATTACH TO GETTING THEIR ROLLING STOCK INTO HONG KONG AS A STEPPING
STONE TO KWANGTUNG AND SOUTH CHINA. SO FAR ELECTRIC ROLLING
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SECRET
/STOCK IN THE