COMMUNICATIONS AND TRANSPORT
Mass Transit Railway
163
Civil engineering construction work for the modified initial system of the mass transit railway was more than 40 per cent complete by the end of the year.
The 15.6-kilometre modified initial system will link the Central district of Hong Kong Island with Kwun Tong in Kowloon. There will be 12 stations underground and three overhead. The line is being built by the Mass Transit Railway Corporation, a public corporation owned by the government, which undertook to provide $800 million in return for equity when the corporation was established in September, 1975. The total cost of building and equipping the modified initial system is $5,000 million at prices adjusted for escalation to 1980, when the system will become fully operational. The total cost of the system, including land and other costs, will be about $5,800 million.
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Money to finance the project has been raised by export credit finance and by loans from both local and international financial markets. All debts are expected to be repaid by 1991-2.
During the year, the Mass Transit Railway Corporation entered into joint ventures with local property developers to develop the space above Chater and Admiralty stations into commercial and office tower blocks. These developments, together with an earlier agreement to build a residential and commercial complex with homes for about 25,000 people above the railway depot at Kowloon Bay, will provide an addi- tional 'cushion' for the financial viability of the project.
The corporation also began to recruit and train staff to run the railway. Fourteen senior operational staff underwent a three-month training course with the London Underground.
Close liaison was constantly maintained between the corporation and various government departments concerned with the construction of the railway. Particular attention was paid to informing the public about the construction work and to minimising inconvenience and disturbance arising from it.
The advance compensation scheme for loss of business caused by the railway con- struction continued to operate. The scheme was designed to alleviate hardship for small business operators occupying premises with a rateable value of less than $250,000.
In July, the Governor in Council approved a proposal by the Mass Transit Railway Corporation to extend the modified initial system to the growing town of Tsuen Wan. The extension will be 10.7 kilometres long and have 11 stations. Work on the exten- sion is expected to begin in mid-1978 and be completed at the end of 1982. The estimated cost, including an escalation factor for inflation, but excluding interest pay- able, finance charges and Crown land premia, is $4,100 million. It will be financed entirely with loans raised by the corporation.