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11.

- 5-

The arguments put forward for siting

the airport in China near to the border with

Hong Kong are :

(a)

(b)

it would cost less

(comment : there is no sound basis

for this conclusion but it could

well be true);

a cooperative project of such a size

(which might include China having a

long-term management contract with the

HKG or with a Hong Kong consortium

and possibly a lease extending beyond

1997) would be a major boost to

confidence in Hong Kong's future.

Its advocates lay particular stress on the second

argument and favour an approach to China now as

politically the most appropriate time.

:

12.

The main arguments against, which

have the support of a large majority of Executive

^

Council Members, are :

(a)

Hong Kong's main means of access

G.F. 326

to the outside world would be beyond

its own frontiers. In consequence,

Hong Kong would be vulnerable to

pressures from China as to its use.

These could vary from preventing the

use of the airport by certain airlines

(e.g. China Airlines, South African

Airways) to preventing the movement

CONFIDENTIAL #≈

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