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industry was not over-stretched.
On the other side of the
coin however the current international lending environment
was not very healthy. The Japanese banks, whom he expected would provide up to 50% of the financing, were having to
retrench. He was also concerned that the Hong Kong
Government might not be able to take decisions as quickly as in the past, given the increasingly political environment. He thought what was primarily needed was more confidence:
administration was being done effectively but the confidence
was no longer there.
Mr Hum asked how crucial it was that funding from the
Finance Committee was made available before the summer.
What would be the impact of a delay? Mr Allen said that the
platform formation contract had to be let in August. This
was already 3 months later than scheduled but this had been
made possible by squeezing the time allocated for building
the terminal. This could not now be squeezed any further
and so delays in awarding the platform construction contract
would lead to delays in the completion of the terminal
building. He said that since they were not actually looking
for money from the banks until next year, a delay would not have a direct impact in that area. However, he said if the institutions perceived that the project was becoming not a particularly good risk, this could well mean that the
interest rates required from banks would be higher than they
might otherwise have been.
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