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W(B)L 51-7406
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a loan of £14 million was obtained from Lloyds
Bank with ECGD cover which in turn was guaran-
teed by the shareholders of the Tunnel Company,
the Hong Kong Government being invigved as to
25% of the amount. While in the case of the
underground railway, the Consultants suggest
that the Government may assume financial respon-
sibility for the capital cost of civil engin-
eering work, the funds required for the mechani.
cal and electrical plant and equipment would
probably be raised in the country supplying the
plant and equipment. The estimated plant and
equipment costs are given by the Consultants as:
Initial System
plus for the Preferred System
7.
£34.3 million £52.2
million
The Consultant's Further Study estimates
that revenue from the Initial System, if agreed
in 1971 and opened by 1976, would pay off the
cost by 1991. In the case of the Preferred
System, the cost would be recovered by estim-
ated revenue by 1993.
8. Opinion on the viability of the project in
Hong Kong seems divided. The Financial Secret-
ary has cast doubt on the sheer cost of the
scheme but it appears that large sections of
the Government and business community are in
favour of the project.
9. There is no doubt that, if the project is
approved, competition for the contract will be
severe. In addition to British firms, tenders
may be expected from Japan, West Germany and
France with the Japanese especially making every
effort, including possibly Government subsidies
and financial guarantees, to obtain the order.
10. Until a decision is come to by the Hong
Kong Government whether or not to go ahead with
No comments yet.
Private notes are available after approval.