CONFIDENTIAL
FM HONG KONG
TO DESKBY 02130OZ FCO
TELNO 3209
OF 021115Z NOVEMBER 90
2219
027210
MDHIAN 7413
CONFIDENTIAL
TOP COPY Q DIST?
HKC 182 / 2
PERSONAL FOR PAUL, HKD FROM GOVERNOR
20
Mr
MIPT AND YOUR TELNO 2023 : PADS: PROSPECTS FOR BRITISH COMPANIES
1. IT IS TRUE THAT WE MADE IT CLEAR TO THE ANGLO JAPANESE CONSORTIUM (AJC) THAT WE WOULD BE RELUCTANT TO ACCEPT A PRE- EMPTIVE BID FOR THE AIRPORT PLATFORM. THIS WAS FOR THE FOLLOWING REASONS :-
(A) IT WAS DIFFICULT TO SEE HOW A BID COULD BE PUT TOGETHER WHEN THE PARAMETERS OF THE CONTRACT WERE NOT YET CLEAR I.E. THE SIZE AND TYPE OF RECLAMATION NOT YET BEEN DECIDED:
(B) WE WERE COMMITTED TO A COMPETITIVE TENDER AND HAD NO WAY OF COMPARING A PRE-EMPTIVE BID PRICE WITH ANY OTHER PRICE :
(C) FOR THESE REASONS WE WOULD HAVE TO PUT ANY PRE-EMPTIVE BID ON
ONE SIDE WHOEVER MADE IT :
(D) THERE WERE ADDED POLITICAL DIMENSIONS TO A PRE-EMPTIVE BID BY A BRITISH CONSORTIUM
:-
(I) THE CHINESE WOULD BE SUSPICIOUS THAT THE BID HAD BEEN ARRANGED BY HKG TO GIVE THE CONTRACT TO A BRITISH FIRM (THE MYTH THAT THE AIRPORT PROJECT IS A SCHEME TO USE UP HONG KONG'S RESERVES BEFORE 1997 FOR THE BENEFIT OF BRITISH BUSINESS, IS A MAJOR PLANK OF CHINESE THINKING. DURING THE COURSE OF THIS WEEK ALONE, IT HAS BEEN REPEATED TO ME ON TWO SEPARATE OCCASIONS BY LEVEL-HEADED PRIVATE SECTOR ASSOCIATE MEMBERS OF THE CENTRAL POLICY UNIT AS PART OF CURRENT GOSSIP IN THE TOWN, NO DOUBT FANNED BY THE CHINESE).
(II) IN PUTTING THE BID ON ONE SIDE, ALBEIT FOR VERY GOOD REASONS, WE WOULD NOT BE HELPING THE UK/HK RELATIONSHIP. THE LOBBY AT YOUR END WOULD USE THIS TO ALLEGE THAT THE HKG WAS BEING NEGATIVE TOWARDS BRITISH BUSINESS.
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