TNAG-0324-FCO40-360-Development-of-Kai-Tak-Airport-at-Hong-Kong-1972 — Page 41

CONFIDENTIAL

XCC(70)41

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to the cost charged to the shipper. He also points out that while Alternate X is that recommended by the airlines this is because it is the only one on which they were all able to agree amongst themselves. Many of the airlines were prepared to accept Alternate A; it was only certain of the big ones who wished to try to find a scheme whereby they would obtain the advantages of Alternate D without the obligation of providing the bulk of the funds them- selves, who strongly favoured Alternate X. The Aviation Advisory Board has unanimously recommended Alternate A. It is for all these reasons considered that Alternate A represents the best arrangement for Hong Kong.

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Examination has, therefore, been made of the arrangements which would be proposed for operating such a freight terminal if Alternate A is decided on. In this connection Honourable Members may wish to note that already two local companies of standing have expressed general interest in taking part in such a scheme. These are both directly involved in the airline business but it is believed that other interests specifically those con- cerned with the port might also be interested. It would, therefore, be hoped that it would prove possible to establish a corporation to run the terminal on which could be represented the major airlines, godown and cargo interests in the Colony. Honourable Members may wish to note that this proposition is not dissimilar from the arrangements proposed in memo- randum XCC(69)36 on Containerisation considered by Honourable Members on 5th August 1969 in connection with the putting to tender of land for con- tainer terminals at Kwai Chung where, should it not prove possible to make appropriate arrangements for the shipping lines themselves to operate container terminal facilities, it was proposed in that memorandum -

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'to explore, in consultation with the private interests,

the possibility of having the container berths and

associated facilities developed by a consortium of shipping and godown interests, possibly with Govern- ment participation".

The next stage in the preparations for development of im- proved cargo facilities is to request the consultants at an estimated cost of about $600,000 to undertake a more detailed evaluation to include:

(a) the detailed planning of the Alternate chosen including the preparation of sketch plans and estimates;

(b) proposals for scales and methods of charging etc.

After obtaining this further report it would theoretically be possible to change the Alternate which it was proposed to adopt. Time, however, which is a most important element, would have been lost and nugatory expenditure incurred. It is therefore considered that a policy decision should now be made on which scheme should finally be adopted always providing that further consideration could be given if the detailed report raises any new factor which would make it essential that a different method of approach should be adopted. This is considered most unlikely.

CONFIDENTIAL