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PAGE TWO XBGR0318 CONFD
CURRENCY.IT IS REVEALING THAT STUMBLING BLOCK AT MOMENT IS TO
PROVIDE LONG-TERM PURCHASING COMMITMENT.CHINA LIGHT AND POWER
(HEADED BY LORD KADOORIE, A PROFESSED OPTIMIST IN FUTURE) IS NOT/NOT
PREPARED TO COMMIT COMPANY TO TYPE OF LONG-TERM COMMITMENT REQUIRED.
IT NOW APPEARS POSSIBLE THAT A NEW ENTITY WITH UNCHARACTERISTIC
HKONG GOVT PARTICIPATION MAY HAVE TO BE SET UP FOR THIS PURPOSE.IF
FRENCH WERE TO WIN CONTRACT, WHICH IS STILL ENTIRELY POSSIBLE,
ARRANGEMENTS FOR HKONG TO PURCHASE ELECTRICITY COULD BE EVEN MORE
DIFFICULT.
4.STATE OF PROPERTY MARKET CONTINUES TO ADD TO GLOOM.THIS IS TIME
OF YEAR WHEN ANNUAL REPORTS APPEAR AND ONE AFTER THE OTHER,
(INCLUDING GIANTS HKONG LAND AND CHEUNG KONG) HAVE REPORTED GREATLY
REDUCED EARNINGS.INDICATIVE OF MARKET WAS WRITE DOWN OF MORE THAN
60 PERCENT OF VALUE OF CHUENG KONGS ASSETS COMPARED TO A YEAR AGO.
FORTUNATELY MANUFACTURING SECTOR IS SEEING EVIDENCE OF AN UPTURN
IN EXPORTS. HOWEVER, EVEN SOME OF MANUFACTURERS HAVE BEEN BADLY HURT
AS A RESULT OF THEIR VENTURING INTO WHAT WAS UNTIL EIGHT MONTHS AGO
A SEDUCTIVELY LUCRATIVE PROPERTY MARKET.EVEN MOST OPTIMISTIC
OBSERVERS DO NOT/NOT EXPECT A SIGNIFICANT UPTURN IN PROPERTY MARKET
BEFORE TWO YEARS. IN MEANTIME, THOSE WHO PAID ASTROMONICAL AMOUNTS FOR
LAND BASED ON EXPECTATIONS OF A CONTINUING GROWTH IN DEMAND AND AND
EVER HIGHER PRICES ARE IN SERIOUS TROUBLE.
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