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4. I explained that time was running out if the project was
to go ahead as envisaged: the Hong Kong Government could not wait indefinitely. We had made many concessions in an effort to reach agreement with the Chinese. But the Hong
Kong Government needed certainty about the financial
assumptions on which the project was based and the freedom to take timely decisions. Endless delays, while the Chinese
were being consulted, would jeopardise the viability of the project.
5. Mr Sagawa took these points immediately. C Itoh were
very ready to talk to their Chinese counterpart if that would help. He stressed the fact that if the project did
not go ahead, it would be the Chinese who would suffer.
would have a knock-on effect on investment in China,
particularly, but by no means exclusively, in southern
China.
It
6. Mr Sagawa added that the Japanese Eximport Bank had made plans, in consultation with the Ministry of Finance, to assist in the financing of the airport project, once it got off the ground. But there were competing claims for these financial resources (eg new airport plans in South Korea, Taiwan and Singapore). So it was important that the Hong
Kong project should not lose momentum. If the current project did not start soon, it would take several years for alternative plans to get off the ground. By that time Hong Kong would have fallen behind its competitors and confidence
in the territory's future would have been badly affected.
Mr Sagawa stressed that Japan's concern with this situation
was not purely commercial: the Government and interested
companies such as C Itoh saw this as having a much wider
significance for the region as a whole.
Mr Sagawa added, incidentally, that Mr Purves of the
7.
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