RESTRICTED
FW Olaves-Smith Esq
Overseas Finance & Development
Division
Department of Trade and Industry
1 Victoria Street
London SW1
LV
2 October 1972
21
I have spoken
To Me Warson
A reply
bhd. be sent soon.
Bu
恒
Bu iSTa
ہے
aix
AID FOR HONG KONG
1.
You wrote to me on 28 July about aid for the airport consultancy. Mark Goodfellow took this up with Thomson, Director of Civil Aviation, when he was in Hong Kong. It is, I fear, pretty clear that it is now too late for us to influence the decision of which firms should proceed with the consultancy. It is the view of Thomson and his advisers that the British firms suggested by the Crown Agents and selected by the Hong Kong Government to compete have neither the background nor the expertise to carry out this survey on the lines required. They have therefore recommended Parsons, an American firm.
2. In addition to this practical difficulty, there is an additional"political" objection put to Goodfellow, on the validity of which I should welcome your view. This is that were a British firm to be selected because HMG paid the consultancy fees, the Hong Kong Government would be laid open to accusation of prejudicing the granting of the final contract. We have, of course long experience of Hong Kong leaning over backwards not to do anything which might be construed as favouring the UK.
3. In his conversation with Goodfellow, Thomson again raised the possibility that HMG might make soft loans available to Hong Kong in connection with airport development. It is not a new idea, of course, but might be worth looking at in the light of the new approach to aid. This is initiallly attractive to us since it would have the political advantage
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