XN000022-1992-09-18 — Page 2

FRIDAY, SEPTEMBER 18, 1992

1

FS CLARIFIES NEW AIRPORT FINANCING PROPOSALS

THE

FINANCIAL SECRETARY, MR HAMISH MACLEOD, TODAY (FRIDAY) SAID THE NEW FINANCING PROPOSALS FOR THE AIRPORT AND THE AIRPORT RAILWAY WOULD BRING IN REVENUE ADDITIONAL TO THE NORMAL LAND SALES PROGRAMME.

THE

SPEAKING ΤΟ MEDIA REPRESENTATIVES BEFORE LEAVING FOR UNITED STATES TO ATTEND THE ANNUAL MEETING OF THE INTERNATIONAL MONETARY FUND/WORLD BANK, MR MACLEOD ALSO GAVE THE ASSURANCE THAT THE PROPOSALS WOULD NOT TAKE AWAY FROM MONEY WHICH MIGHT BE USED ON OTHER AREAS.

HE SAID :"ONE KEY MATTER TO REMEMBER IS THAT THE REVENUE FROM THE AIRPORT RAILWAY RELATED LAND IS ADDITIONAL TO THE NORMAL SALES PROGRAMME. IT'S ADDITIONAL TO THE

LAND FORECAST TILAT WE HAVE HITHERTO BEEN USING.

PLACES,

"THAT'S NOT A SITUATION THAT YOU COULD GET IN MANY OTHER HONG KONG IS PECULIAR IN HAVING AN ARTIFICIAL CONSTRAINT ON THE LAND SUPPLY. IT'S PECULIAR IN HAVING THE LAND SUPPLY CONTROLLED IN THE END BY A BODY ON WHICH OF COURSE THE CHINESE ARE REPRESENTED.

"SO THERE'S AN ARTIFICIAL CONSTRAINT AND IF YOU LIFT THAT CONSTRAINT IN THIS CASE FOR AIRPORT RAILWAY RELATED LAND, THEN YOU DO IN FACT GET ADDITIONAL REVENUE WHICH WASN'T PREVIOUSLY EXPECTED.

"IT WASN'T EXPECTED EITHER IN OUR FORECAST OF OUR RESERVES NOR IN THE FORECASTS OF THE LAND FUND, SO IT'S ADDITIONAL IN CASES.

BOTH

RESPONDING TO A QUERY THAT THE NEW PROPOSALS MIGHT AFFECT OUR SPENDING ON SOCIAL SERVICES, THE FINANCIAL SECRETARY SAID: 'I CAN VERY

SAY CLEARLY THAT IT IS NOT SUPPOSED TO TAKE AWAY FROM WHAT WE ARE SPENDING AND WHAT WE SHOULD BE SPENDING ON SOCIAL PROGRAMMES.

"THOSE WILL GO AHEAD AT FULL STEAN.

"THIS IS ADDITIONAL REVENUE, IT IS NOT TAKING AWAY FROM WHAT WE ARE SPENDING ON OUR NORMAL FINANCING AND SOCIAL PROGRAMMES.

"I THINK YOU WILL FIND WHEN YOU HEAR THE GOVERNOR'S SPEECH ON OCTOBER THE SEVENTH THAT WHAT I HAVE SAID WILE RE VERY CLEARLY CONFIRMED."

AS TO THE QUESTION OF

COST-EFFECTIVENESS, HE

SAID A KEY

RESULT OF THE PROPOSALS WAS OF COURSE A REDUCTION IN THE FINANCING COSTS.

WE'VE ESTIMATED THAT TO BE ABOUT $10 BILLION WHICH IS A VERY LARGE SUM OF MONEY. SO THAT CERTAINLY WILL HELP TO MAKE THE PROJECT MORE COST EFFECTIVE.

/"ALTERING THE