SAID THAT WE WOULD NOT WISH TO DO THIS AND THAT IT WOULD GAUSE, DIFFICULTY WITH CONSENSUS, EC AND BERNE UNION PARTNERS. PLEASE DISCUSS WITH INTERNATIONAL RELATIONS DIVISION AND TELEX THEIR VIEWS TO ME VIA BTC. ROBERTS NATURALLY STRESSED THE ARGUMENT THAT THE OFFER TO SWITCH TO LONGER CREDIT WOULD BE AN IMPORTANT INDUCEMENT FOR MASS TRANSIT TO ORDER EQUIPMENT FROM UK. THIS IS AN ARGUMENT ABOUT WHICH I AM SLEPTICAL.
5. WE HAVE UNDERTAKEN TO SUBMIT CASE TO TREASURY FOR HONG KONG DOLLAR FINANCE. WE KNOW FOR CERTAIN THAT MASS TRANSIT WILL NOT CONTRACT FOR PAYMENT IN ANY OTHER CURRENCY. I ASSUME THAT THE EQUIPMENT ORDERS WITHOUT EXCEPTION FALL WITHIN AN AREA OF INDUSTRY FOR WHICH THERE WOULD BE AN UNQUESTIONABLE NATIONAL INTEREST CASE. ALTHOUGH THIS MIGHT NOT APPLY TO CONSULTANCY CONTRACTS IT WOULD BE
WRONG TO CONSIDER THESE IN ISOLATION, THEY ARE PART OF THE OVERALL PROJECT AND REFUSAL TO CONSIDER LOCAL CURRENCY FINANCING FOR THIS ELEMENT ALONE COULD PREJUDICE CHANCES FOR UK EQUIPMENT MANUFACTURERS
THIS ASPECT CAN AWAIT OUR RETURN, UNLESS WE ARE UNDULY DELAYED, BUT PLEASE ALERT DAVE TOWNLEY.
6. LAZARDS CLAIM TO HAVE NOMINATION FROM GEC AND METCAM AND EXPECT
TO GET ONE FROM BALFOUR BEATTY. POSITION ON NOMINATIONS FOR CONSULTANCY SERVICES IS UNCLEAR. WE HAVE SAID THAT WE WOULD NEED TO SEE WRITTEN NOMINATION BEFORE WE WOULD PROCEED BEYOND INITIAL INDICATION AND THIS HAS BEEN PROMISED FOR DELIVERY TO US WHILST
IN HONG KONG.
7. SINCE DRAFTING THE ABOVE, MICHAEL ROBERTS HAS TOLD US THAT ABOUT £1 1/2 MILLION OF THE PROPOSED £10 MILLION CONSULTANCY BUYER CREDIT WOULD BE FOR LOW VALUE HARDWARE WHICH COULD NOT BE SUPPORTED
SEPARATELY AND WHICH WAS NOT APPROPRIATE FOR INCLUSION IN OTHER
EQUIPMENT CONTRACTS. WE HAVE SAID WE WOULD ACCEPT THESE FOR
INCLUSION IN THE BUYER CREDIT FOR THE CONSULTANCY SERVICES
PROVIDED THEY MET OUR NORMAL CRITERIA FOR MINIMUM ORDER VALUE
OF SAY £250,000 ET AL.
& THE OTHER SUBJECT DISCUSSED WAS A STERLING LINE OF CREDIT VALUED ABOUT £7 1/2 MILLION FOR JARDINE MATHESON'S ENGINEERING SUBSIDIARY. THE GOODS COMPRISE ELECTRICAL AND MECHANICAL EQUIPMENT
OF SMALL UNIT VALUE SUCH AS SEWAGE PUMPS AND AIR CONDITIONING EQUIPMENT FOR OFFICES AND HOTELS. JARDINES APPARENTLY IMPORT SOME 630 MILLION OF SUCH ITEMS FANNUALLY FROM THE UK PRESUMABLY ON CASH OR SHORT CREDIT AND HOW HOPE TO FIND NEW MARKET AMONGST PROPERTY DEVELOPERS AND ALSO TO RECOVER LOOT BUSINESS WITH HONG KONG ELECTRIC
BY OFFERING CREDIT. WE HAVE SAID THAT WE WOULD PROBABLY INSIST ON
SUCH EXPORTS BEING COVERED UNDER COMPREHENSIVE SUPPLIER CREDIT