FRIDAY, NOVEMBER 26, 1993
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HK CENTRE FOR PROJECT FINANCE
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HONG KONG IS ALREADY WELL-ESTABLISHED AS A CENTRE FOR PROJECT FINANCE, THE FINANCIAL SECRETARY, MR HAMISH MACLEOD, SAID TODAY
(FRIDAY).
MR MACLEOD WAS SPEAKING AT THE OPENING OF THE PACIFIC/ASIA ENERGY FINANCING FORUM ORGANISED BY THE WORLD ENERGY COUNCIL.
ACCORDING ΤΟ A RECENT SURVEY, HE SAID, 41 OF THE 50 TOP ARRANGERS OF ASIAN SYNDICATED LOANS LAST YEAR HAD A PRESENCE IN HONG KONG.
"IN THE ENERGY FIELD WHAT IS REPORTED TO BE THE BIGGEST EVER SYNDICATED LOAN FACILITY ARRANGED IN HONG KONG HAS BEEN MADE AVAILABLE TO THE CASTLE PEAK POWER COMPANY LTD: JOINTLY OWNED BY EXXON ENERGY LTD AND CHINA LIGHT AND POWER.
FINANCE FOR THE DEVELOPMENT OF THE SHAJIAO C POWER STATION IN QUANGDONG PROVINCE WAS ALSO ARRANGED IN HONG KONG, HE SAID.
"APART FROM THE MORE TRADITIONAL FORMS OF FUND-RAISING ACTIVITIES, SUCH AS SYNDICATED LENDING BY THE BANKING SECTOR, WE ARE NOW SEEING THE RAPID DEVELOPMENT OF THE DEBT MARKET IN HONG KONG, HE SAID.
H
MR MACLEOD ALSO POINTED OUT THAT HONG KONG'S CAPITAL MARKET WAS NOT ONLY PLAYING AN IMPORTANT ROLE IN HELPING TO FINANCE THE ECONOMIC DEVELOPMENT IN CHINA, IT WAS ALSO ENABLING HONG KONG TO BECOME A MAJOR CENTRE FOR THE RAISING OF FUNDS BY CHINA'S ENTERPRISES.
ON ENERGY SUPPLY IN HONG KONG, HE NOTED THAT HONG KONG HAD A LONG HISTORY OF RELYING ON THE PRIVATE SECTOR TO SUPPLY THE TERRITORY WITH ALL OF ITS ENERGY NEEDS.
HE ADDED THAT HONG KONG MONITORED THE OPERATIONS OF THE TWO ELECTRICITY SUPPLY COMPANIES THROUGH A MECHANISM KNOWN LOCALLY AS A SCHEME OF CONTROL AGREEMENT WHICH SET OUT, ON A MUTUALLY AGREED BASIS, THE OBLIGATIONS AND RIGHTS OF THE COMPANIES AND OF THE GOVERNMENT ON BEHALF OF CONSUMERS.
"UNDER THE TERMS OF THE AGREEMENT, THE GOVERNMENT IS ABLE TO MONITOR THE FINANCIAL PLANNING AND TECHNICAL AND OPERATING STANDARDS OF THE COMPANIES AND REQUIRE THEM TO SEEK GOVERNMENT APPROVAL FOR ASPECTS OF THEIR FINANCING PLANS, INCLUDING PROJECTED TARIFF
CERTAIN LEVELS.
"AS A RESULT, WE ARE ABLE TO SATISFY OURSELVES AS TO THE COST- EFFECTIVENESS OF THE COMPANIES' DEVELOPMENT PLANS, HE SAID.
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IN RETURN FOR AGREEING TO CLOSELY MONITOR THEIR COMPANIES' OPERATIONS, SHAREHOLDERS ARE PROVIDED WITH THE ASSURANCE THAT THEY MAY EARN UP TO A CERTAIN MAXIMUM PERMITTED RETURN ON THEIR INVESTMENTS.
/GIVEN THE