CODE 18-77
Reference
B
VT37THU.597
TO:
Minister for Trade
FROM:
Alan Murray
V/306
215 5412
cc Secretary of State
Mr Redwood
Sir Peter Gregson
Mr Roberts
Mr Lane
Mr Meadway Mr Salvidge Mr Phillips
Dep Sec
Dep Sec OT2
TP
TP2
Mr Johnson Mr Love
EEP1
OT2/2
Mr Anisfeld
Sp Adv
4
August 1991
CABLE & WIRELESS INTERESTS IN HONG KONG
Issue
The impact upon Cable & Wireless's interests in Hong Kong if the Hong Kong Government proceeds with liberalisation of Hong Kong's domestic and international telecommunications.
Recommendation
To take note.
Timing
Routine.
Argument
There has been growing pressure from some quarters in Hong Kong for a break up of Cable & Wireless's monopoly position in local and international telecommunication services. The US, who are very successful in the Hong Kong market overall, have been particularly active with AT & T, for example, threatening to move to other Asian centres unless the Hong Kong Government accedes to competition. The HK Government are concerned that if they do not liberalise, US interests in particular may indeed move some of their activities to another telecoms hub (eg Singapore) in the region.
The Hong Kong Government has appointed Booz Allen Hamilton, an American firm of consultants, to consider whether a second telecommunications network should be built in Hong Kong and to assess the impact of removing the exclusive franchise on local calls after the current agreement expires in 1995. The report which is now in the hands of the Hong Kong Government, is understood to recommend early liberalisation of the network.
1