TNAG-0322-FCO40-358-Construction-of-underground-railway-system-in-Hong-Kong-1971 — Page 95

HK X 21/2

DL Hawkins Esq

HY Treasury

Great George Street LONDON 8 # 1

Hong Kong Department

15

↑ February 1971

1.

I am sorry that you have had to wait so long for our views on the proposed Hong Kong underground railway.

2. In his letter to Jones of 15 December 1970, Toms summarized the facts available to CRE. We here cannot add anything to what he said about the possibility of the scheme being approved by the Hong Kong Government. Nor do we know what financial arrangements the Hong Kong Government are likely to propose should they decide to go ahead with the plane prepared by Freeman Fox and Partners. We have therefore written to the Governor and a copy of the letter is attached.

3. We regard it as particularly important that British firms should secure a reasonable share of the contracts that will be up for tender if the scheme is approved. At the same time we think it would be unwise to attempt in any way to persuade the Hong Kong Government to give preferential treatment to our firms.

As you know, the Hong Kong Government feel strongly that it is up to commerce and industry in the UK to make the most of the advantages they have stemming from the fact that Hong Kong is a British Colony.

b. Turning now to the other points raised in your letter to Willson of 26 November, 1970, the only additional information we can contribute in reply to your paragraph 2 18 that we have had a report from Hong Kong that the project is attracting considerable interest in Europe, Japan and North America.

5. As to the political situation in the Colony, the Chinese Peoples' Government - like previous Chinese Governments – regard all of Hong Kong (and not only the New Territories whose lease runs to 1997) as Chinese territory, wrested from them during a period of Chinese weakness and to be recovered in due course. The Hong Kong situation, they say, is a legacy from unequal treaties in the past and one which will be settled through negotia- tions at an appropriate time.

CONFIDENT IAL