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The Memorandum of Understanding clearly states China's support for the airport project, and gives the Hong Kong Government the certainty it needs to proceed with the project.
It sets out that China will indicate to investors that
contracts and obligations will be honoured after 1997. The
Hong Kong Government will complete as much as possible of the
core projects before 30 June 1997. These are the airport (first runway and associated facilities); North Lantau
expressway; West Kowloon reclamation; West Kowloon expressway;
Western Harbour crossing; Route 3 (part); airport railway; that
part of the central and Wanchai reclamation that relates to the
airport railway; Lantau fixed crossing (including rail portion
and route 3 interchange); and Tung Chung development, phase I.
To make cooperation easier, an Airport Committee will be
constituted under the Joint Liaison Group with tightly defined
terms of reference. It will be a forum for consultation about
the granting of major airport franchises or contracts, with 30 days allowed for discussion. Should the Hong Kong Government wish to add a major new airport-related project not in the
current core programme (which is unlikely), the Committee will
discuss the question and the Hong Kong Government will proceed only if a common view is reached. The same will apply to any core projects for which the bulk of Government expenditure will
fall after 1997.
Separately, the Hong Kong Government will establish an
Airport Authority, which will include a Hong Kong-based member
of the Bank of China Group, and set up a Consultative Committee
on the airport. The Hong Kong Government will be able to
borrow generally up to HK$5,000 million with maturity after 1997. If it wishes to borrow more, this must be agreed
with the Chinese, who have undertaken to adopt a positive attitude to reasonable proposals. The Hong Kong Government
will plan its finances so as to leave not less that HK$25,000
million in reserves in 1997.
The new airport project having been agreed, the burgeoning growth in Hong Kong's trade with China has caused the Kowloon