TNAG-0131-FCO40-167-Asia-Committee-of-British-National-Export-Council-1969 — Page 5

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Mr. Aiers (South-West Pacific Dept.)

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Thank you

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Bün

B.N.E.C. (Asia) Committee

This is to let you know of an issue which may possibly come up in the future at one of your meetings.

2.

Some time ago the Hong Kong Government applied for a grant from C.D. & W. funds towards the cost of improving the telecommunications capability at Kaitak Airport. Certain new civil radar equipment has to be installed.

3. O.D.M. turned down the application, on the usual grounds, in Hong Kong's case, that the Colony is too wealthy for aid. There is a remote possibility, but very remote, that this decision may be changed by the intervention of Ministers.

4. Hong Kong have to go ahead with the purchase of the necessary equipment and it looks very much as though they are going to buy from Selenia, an Italian firm, and not from Plessey who have offered alter- native equipment. There are various technical complications I need not go into but Plessey have been saying that Hong Kong are biased against them because a particular official in the Department of Civil Aviation is hostile to Britain, and that they have not been given a fair hearing. On the other hand Plessey did not, on their own admission, come up with a suitable radar until October this year, whereas Hong Kong have been looking for the equipment for nearly two years.

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5. We in this Department have offered to lactas a "post box" for Plessey's case to the Hong Kong Government, to make quite sure that they do get a fair hearing; and Plessey, together with the Board of Trade and Ministry of Technology, are engaged at the moment on preparing their case.

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6. If the issue does come up, all that could be said is that we do not interfere with the Colonial Government's buying policy and they shop in the best and cheapest market. This is all the more true when it is their own money and not any grant from H.M.G. they are proposing to use. However we are doing our best to ensure that the British equipment is considered in fair competition with anyone else's and our information is that until very recently there has been no competition as such, because the British firm had nothing to offer.

7.

For your own information Plessey have an

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