UNCLASSIFIED
053532
MDLIAN 4817
19.
CHINESE AGREEMENT TO THE CENTRAL/WANCHAI RECLAMATION PROJECT WAS WIDELY WELCOMED. QUOTING SOURCES, SING PAO NOTED CHINESE APPROVAL TO THE CENTRAL/WANCHAI RECLAMATION DID NOT MEAN THE FINANCING ARRANGEMENTS FOR THE AIRPORT RAILWAY WOULD BE RESOLVED.
20. ACCORDING TO THE SOURCES (8.7) THE GAP BETWEEN THE TWO SIDES ON THE AIRPORT FINANCIAL ARRANGEMENTS HAD BEEN NARROWED SUBSTANTIALLY AFTER THREE AIRPORT COMMITTEE MEETINGS. THE CHINESE SIDE EXPECTED THE MINISTERIAL MEETING WOULD HELP CLEAR THE REMAINING OBSTACLES. SHOULD THE MEETING GO WELL, A FOURTH ROUND OF MEETINGS WOULD BE HELD SHORTLY WITH A VIEW TO REACHING AN OVERALL AGREEMENT ON THE FINANCIAL PACKAGE. THE SOURCES HOWEVER WARNED THE AIRPORT TALKS MIGHT BE AFFECTED IF THE SECRETARY OF STATE ADOPTED AN UNCOOPERATIVE ATTITUDE OVER THE CONSTITUTIONAL ISSUES.
21.
ORIENTAL DAILY QUOTED (9.7) CHINESE SOURCES IN THE AIRPORT
COMMITTEE AS SAYING THERE WAS STILL A CONSIDERABLE GAP BETWEEN THE TWO SIDES ON THE AIRPORT FINANCIAL ARRANGEMENTS. ON THE POSSIBILITY OF USING THE LAND FUND TO BUY AA BONDS, THE SOURCES SAID IT WOULD DEPEND ON WHETHER THE FUND WOULD BE IN A POSITION TO DO SO. QUOTING CHINESE SOURCES IN THE LAND COMMISSION, THE PAPER SAID THE LAND COMMISSION HAD NOT CONSIDERED USING THE LAND FUND TO SUPPORT THE NEW AIRPORT, ADDING THIS WOULD NOT BE APPROPRIATE. THE HONG KONG DAILY NEWS IN A REPORT FILED FROM PEKING QUOTED THE CHIEF EXECUTIVE
OF THE LAND FUND AS SAYING THE FINANCIAL ARRANGEMENTS WERE STILL BEING DISCUSSED BY THE TWO SIDES AND IT WAS TOO EARLY TO STUDY
WHETHER THE LAND FUND SHOULD BE INVOLVED.
22.
QUOTING CHINESE SOURCES, MING PAO REPORTED (9.7) THE CHINESE SIDE HAD RESPONDED TO THE FINANCING PACKAGE TABLED BY THE BRITISH SIDE AND HAD PUT FORWARD CONCRETE VIEWS ON EQUITY INJECTION BY THE GOVERNMENT AND THE AMOUNT OF BORROWINGS. THE CHINESE SUGGESTIONS SHOULD ALLOW THE HKG TO HANDLE WITH MORE FLEXIBILITY THE DOLLARS 5
BILLION LIMIT ON RAISING LOANS. THE CHINESE SIDE HOPED MR HURD WOULD MAKE CLEAR HIS VIEWS ON THIS ISSUE AT THE MINSTERIAL MEETING.
23.
THE HK ECONOMIC JOURNAL QUOTED (11.7) THE CHIEF EXECUTIVE OF THE LAND FUND CHUNG SHIU-MING AS SAYING USING THE FUND TO PURCHASE BONDS ISSUED BY THE AIRPORT AUTHORITY WAS NOT THE WAY TO RESOLVE THE FINANCIAL ARRANGEMENTS FOR THE AIRPORT. THIS OPTION WOULD ONLY BE CONSIDERED AFTER THE FINANCIAL ARRANGEMENTS HAD BEEN RESOLVED. THE EXPECTED RETURN RATE WOULD ALSO BE TAKEN INTO ACCOUNT.
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