CONFIDENTIAL
The Nineth Management Group Meeting Held in Guangzhou
on July 9-10, 1980
Salient Points about the Proceedings & Noteworthy
ad-lib Remarks
HOW MR STONES' PAPER WAS RECEIVED
Mr Chen was well impressed. He said it was a very good paper and must have taken up much of Mr Stones' time and energy in preparing it.
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Later, over dinner, Mr Chen said that when he came away from the previous meeting, he had carried away the impression that CLP were likely to back out in view of the immensity of the project with the great risks that it entailed. However, after the day's meeting, he had changed his mind, and thought CLP were now more confident in the success of the joint project. This also. showed the impact of the paper. He must have concluded that only people with serious intent could have produced such a brainchild.
ON THE PROPOSED COMPANY HKNIC
Mr Chen queried about the possibility of forming such a company, and asked who the other members would be besides CLP. Later, over dinner, he said that from long dealings with CLP, the Chinese side had full confidence in the H.K. company. And the CLP also stood in the good grace of the Guangdong government. But KEC had misgivings about these other members of the would-be company, because they were unknwon to KEC.
At one point in the course of conversation (in Mr Stones' room) he asked if HEC would be accepted as a partner in the HKNIC.
my long.
THE CONTRACT PERIOD
Mr Chen deemed the 25-year period too long. If the construction took five or six years, then it would be some 30 years from now. He suggested if the contract period dating from commissioning could be 15 to 20 years, so that the contract would expire in about 20 or 25 years' time, assuming the construction period to be 5-6 years. He explained that as China' four modernizations movement gained momentum, China' foreign exchange might vastly improve in the foreseeable future, and she would probably be. in a much better. pósition to pay off her debts in the coming years. As her foreign currency balance of payment improved, she would like to effect gradual transfer of equity shares in a joint venture."
CONFIDENTIAL