AIRPORT AUTHORITY FINANCIAL PACKAGE
(Paper handed over to the Chinese on 3 April 92. It will be handed to the ACC on 30 May 1992)
Main features
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The
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Points to make
airport will cost $46.3 BN (1991) to build, (AA to fund $33.7 BN; private sector investors $9.5 BN; Government $3.1 BN for Government facilities).
It is estimated that the PAA/AA will borrow about $37 BN (MOD).
The Government will provide total equity to the PAA/AA of $19.5 BN (1991) [25.1 BN MOD]. $13.6 BN (1991) [$16.6 BN (MOD)] will be paid up in 1993.
The Government will undertake to pay the balance as callable equity of up to $5.9 BN (1991) [ $8.5 BN (MOD)] to meet specified adverse risks. (cost
inflation,
high development profit.)
reduced
over-run,
property
The PAA will be able to charge a passenger terminal charge of $50 (1991) per passenger, which could go up to $100 (1991) in the event of adverse conditions.
If
Chek Lap Kok Airport is completed late, surpluses from the continued operation of Kai Tak will then be used by the AA to meet its debt obligations. The SARG would not receive these profits anyway, if CLK opened as planned.
The Government will not seek dividend payments from the AA, nor seek payment for air traffic control & meteorological services, during the initial period of debt repayment.
Unlike the MTRC, the AA will have no significant operating revenues until completion of the airport. Government must commit to much more up-front support than is necessary for the MTRC.
Airport Finance : p.1 of 2