SECRET
064011
M AN 8346*
(C)
!
1
(D)
1
(E)
(F)
(G)
ADDITIONAL BRITISH DEMANDS ON BORROWING:
WE HAVE NOT RENEGED ON SECRETARY OF STATE'S OFFER. HE MADE CLEAR AT THE TIME THAT THE OFFER OF LEAVING A SUM OF FISCAL RESERVES IN 1997 WAS MADE ON THE ASSUMPTION THAT THE CHINESE WOULD RAISE NO OTHER FINANCIAL POINTS ON THE AIRPORT.
GOVERNMENT BORROWING WAS FORESEEN IN THE WRITTEN PRESENTATION WHICH WE MADE TO THE CHINESE.
SO WAS THE POSSIBILITY THAT WE WOULD NEED TO TO GUARANTEE BORROWING.
NEW LAND COMMISSION-TYPE BODY:
JLG SET UP UNDER JD TO CONSIDER QUESTIONS RELATING TO A SMOOTH TRANSITION.
AIRPORT AUTHORITY SHOULD BE THE BODY TO MANAGE THE AIRPORT.
ABSTRACT ACCEPTANCE BY BRITISH SIDE OF CHINESE PRINCIPLE:
ON THE CONTRARY, WE HAVE BEEN TRYING THROUGH CONSULTATION, TO SOLVE THE SPECIFIC ISSUES ON WHICH THERE NEEDS TO BE CERTAINTY BEFORE THE HKG CAN GO AHEAD WITH THE AIRPORT PROJECTS WITH PRUDENCE.
NOT BALANCED FOR CHINESE SIDE TO PROPOSE CERTAINTY ON
THE POINTS OF CONCERN TO THEM BUT TO ARGUE THAT THE POINTS OF CONCERN TO US CAN BE CONSIDERED IN THE FUTURE.
MEANING OF CONSULTATION:
FOR THE CHINESE SIDE MEANS THAT THERE NEEDS TO BE AGREEMENT.
WAY FORWARD:
TWO SIDES AGREED TO KEEP IN TOUCH.
WILSON
PAGE
SECRET
2