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MDLIAN 587
PROCEEDED SMOOTHLY, THAT MONEY CONTINUED TO POUR INTO THE CITY FROM FOREIGN INVESTORS, AND THAT THE SAVINGS RATE AMONG CITIZENS WAS HIGH. THERE WAS THEREFORE NO NEED TO SLOW DOWN CONSTRUCTION IN THE CITY. THE CITY WOULD OF COURSE IMPLEMENT THE CURRENT POLICY OF STRENGTHENING MACROECONOMIC CONTROL, BUT CANTON HAD FEATURES' AND THERE WOULD BE NO NEED TO SLOW DOWN CONSTRUCTION OF MAJOR INFRASTRUCTURE PROJECTS, WHICH WERE MADE ALL THE MORE NECESSARY BY THE LARGE INFLUX OF PEOPLE TO THE CITY. DAI ADMITTED THAT INFLATION IN THE CITY WAS THE HIGHEST IN CHINA, BUT COMMENTED THAT CITIZENS ALSO ENJOYED A COMPARATIVELY HIGH STANDARD OF
LIVING.
4. LIN GUO WEI ECHOED THESE REMARKS IN THE MEETING ON 7 SEPTEMBER. THE CURRENT SHORTAGE OF DOMESTIC FUNDS FOR INVESTMENT WAS IN FACT A PLUS POINT FOR CANTON, AS IT HAD CAUSED A FALL IN THE COST OF RAW MATERIALS FOR CONSTRUCTION. NOW WAS THEREFORE THE TIME TO PRESS AHEAD WITH INFRASTRUCTURAL PROJECTS. LIN LATER REPEATED THESE REMARKS IN A PRIVATE CONVERSATION WITH MR YEO AT THE AIRPORT JUST BEFORE THE LATTER'S DEPARTURE.
5. THERE WAS, HOWEVER, A MORE REALISTIC NOTE IN OTHER EXCHANGES ON THE PROBLEMS OF FINANCE FOR PROJECTS SUCH AS THE WASTE WATER AND SOLID WASTE TREATMENT PLANTS PLANNED BY THE CITY. REFERENCE WAS MADE TO GERMAN AID GIVEN FOR THE DATANSHA WASTE WATER PLANT, THOUGH WITHOUT MAKING ANY STRONG PUSH FOR UK CONCESSIONAL FINANCE FOR OTHER PLANTS IN THE CITY. THE POSSIBILITY OF FUNDING SOME INFRASTRUCTURE PROJECTS ON A BOT BASIS WAS RAISED BY THE CHINESE. THERE WAS ALSO A SUGGESTION THAT THE NEW AIRPORT WOULD BE FINANCED PARTLY BY FOREIGN EQUITY PARTICIPATION. ZHANG CHUNLIN (BAIYUN AIRPORT GM) SAID THAT SOME DISCUSSIONS ON THIS HAD ALREADY TAKEN PLACE WITH BAA PLC AND HUTCHISON WHAMPOA.
6. LIN AGAIN RAISED THE QUESTION OF FINANCE IN HIS PRE-DEPARTURE CONVERSATION WITH MR YEO. HE SAID THAT FOREIGN LOAN FINANCING WAS INCREASINGLY OUT OF FAVOUR BECAUSE OF THE PROBLEMS OF EXCHANGE RATE FLUCTUATIONS. HE HOPED FOR GREATER FOREIGN EQUITY PARTICIPATION IN INFRASTRUCTURAL PROJECTS.
COMMENT
7. THERE WAS LITTLE NEW ABOUT PROJECTS TO BE LEARNT FROM THE MISSION'S MEETINGS. THE MISSION WERE SUBJECTED TO A FAIR AMOUNT OF RITUAL RECITATIONS FROM, FOR EXAMPLE, THE ENVIRONMENTAL PROTECTION BUREAU ON IMPLEMENTATION OF POLICIES. HOWEVER, THE INSISTENCE OF
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