TNAG-0340-FCO40-376-Aid-to-Hong-Kong-from-UK-1972 — Page 91

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Mr Crowson Mr Wilford

1.

Mr

AID FOR HONG KONG

Wilford asked me to take up in Hong Kong the pro- posal originating in Mr Glaves-Smith's letter of 20 July that HMG might find £200,000 from aid funds for the Hong Kong feasibility study on airport facilities.

2. The Hong Kong Government who maintain their right to select their own consultants for development projects did not approach the British Trade Commission in connection with this consultancy. However, the Trade Commission reported to the DTI in April that four British firms had been suggested by the Crown Agents. Of these the Hong Kong Government selected Halcrows and Scott Wilson Kirkpatrick. Unfortunately the Hong Kong Government thought that neither of these, from their preliminary proposals, had the expertise or experience to undertake a survey of this nature. The other six firms of the eight originally approached by Hong Kong were North American (two Canadian and four from the United States).

3.

When I was in Hong Kong, Mr Thomson, Director of Aviation, told me he had already proposed that an American firm, Parsons, should be appointed as consultants for this study. He was firm that he could make no other selection and as the matter had already been delayed by the previous Financial Secretary, action must go ahead now.

4. Mr Derek Jones (Deputy Economic Secretary) later said that he thought the Financial Secretary in particular would reject any offer by the UK to pay for a consultancy on the grounds that this would appear to be prejudicing the outcome when the contract came to be paced.

5. I attach a draft reply to Mr Glaves-Smith, which incor- porates Mr Thomson's suggestion that the UK should consider making soft loans available to Hong Kong for airport develop- ment. Aviation and Telecommunications Department and Financial Policy and Aid Department have agreed the draft but FPAD have made the point (with which I agree) that it is unlikely ODA will welcome this idea and that the proposals for aid to Hong Kong, put forward by Mr Haddon-Cave in his letter of 17 August, should be given priority.

LM:

fir

25 September 1972

cc: A & T D

FPAD

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M A Goodfellow

Hong Kong and

Indian Ocean Department

'Mr