CONFIDENTIAL

112702 MDHIAN 8286

3. I HAVE HOWEVER SUSPENDED ACTION ON (A) TEMPORARILY. THERE IS A RISK IN DOING THIS. IF IT LEAKS, IT COULD BE SEEN AS ACCEPTING THE CHINESE DEMAND THAT ALL AIRPORT RELATED WORK SHOULD CEASE PENDING THEIR AGREEMENT. BUT I SEE A GREATER RISK IN GOING AHEAD WITH AUTHORISING WORK DIRECTLY CONNECTED WITH CHEK LAP KOK IMMEDIATELY AFTER THE PEKING CONFRONTATION. IT WOULD GIVE THE CHINESE A CONVENIENT STICK TO BEAT US WITH AT A TIME WHEN, AS I HAVE RECOMMENDED SEPARATELY, WE NEED TO SAY SOME FORCEFUL THINGS TO THEM AND TO DO SO FROM AS STRONG A POSITION AS POSSIBLE. THE LETTER OF ACCEPTANCE WILL NEVERTHELESS HAVE TO BE SIGNED SOON, AND THE WORK BE ALLOWED TO START, IF WE ARE NOT TO PREJUDICE OUR WHOLE POSITION ON THE AIRPORT AND THE TIMETABLE FOR THE WORK CONNECTED WITH IT. WE WILL WORK ON THE PRECISE TIMING SEPARATELY.

WILSON

YYYY

ΜΑΙΝ

58

.HONG KONG AGREEMENT

.(RESTRICTED)

LIMITED

HKD

HD/FED

NEWS D

ADDITIONAL

2

DISTRIBUTION

60

60

PUSD

RAD

PS/LORD CAITHNESS PS/MR LENNOX-BOYD

MR MCLAREN

MR BURNS

MS BARRETT LEGAL ADVISERS

MR FIFOOT LEGAL ADVISERS

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CONFIDENTIAL

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