HWB 21/5
CONNDENTIAL
COMMONWEALTH OFFICE,
97
Curtis Green, London, 3.W. 1.
31 January, 1968
Dear Men's,
You may have been wondering about the current state of play on the Hong Kong Cross-Harbour Tunnel, and as the most recent news I have had seams to indicate that the project is dead, at least for the time being, I felt I ought to let you know
#
Shortly before Christmas, John Marden, who is Chairman of the Tunnel Company, showed me a copy of the letter the Company had received from the Hong Kong Government in which it was stated that
... the Government is not prepared to guarantee the Company's bank loan on the terms laid down by the Export Credita Guarantee Department", The Hong Kong Government also declined to take up the short-fall in the equity resulting from the decision taken by private participants in July to reduce their subscriptions. John Cowperthwaite, the Financial Secretary, confirmed this when I met him on 10 January and emphasised that these were final decisions on the part of his Government.
On the following day John Marden came to see me again. On this occasion he told me (as I already knew) that he felt serious doubts about continuing with the project and that other members of his Board (but not Claque) shared his viewa, (My information is, incidentally, that the Karden group of companies are going through an uncomfortable patch, at the present time, and would not find it at all easy to meet their commitments on the Tunnel project).
ly expectation is that very shortly the Tunnel Company and the Hong Kong Government will agree to shelve the project and will then
their heads together to devise a suitable public announcement. I do not expect any further formal communication from the Hong Kong Government until that decision has been taken; and I will, of course, let you know immediately we get any confirmation of my reading of the situation.
It is indeed unfortunate that a useful export order of the size involved in this project should be lost. But overall we think it is in Hong Kong's best interests to shelve the project; there are many more pressing purposes to which Hong Kong's resources can and should be put at this time. And this particular project no longer carries the political significance it had some seven to eight months ago.
I am sending a copy of this letter to Cotterill (ECOD) and Hawkins, Tra
«xury).
LAST
REE
98
M.S. Horris, Esq.,
І праив виселеви
(Aza.) W... banter. ($qd.)
Commercial Relations & Export Dept.,
Board of Trade.
(w.s. Carter)
I dies sent to
Mr. K.W. battenll (ECGA)
ее
ENTIAL SL. Hankind (Morealy)
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