TNAG-0424-FCO40-470-Construction-of-an-underground-railway-system-in-Hong-Kong-1973 — Page 224

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can be paid off within a definite period of time, without subsidy from public funds;

that the Hong Kong Government's financial and technical involvement in the project should be kept to a minimum;

(d) that any contribution made by the Government

towards the project should rank pari passu

(e)

with contributions of the same type made by outside sources, or should at least be rewarded in one way or another; and

that any guarantee which the Government might be required to give in respect of borrowings for the system should not involve a specific pledge of the Government's assets.

Within the context of these considerations, it has been established from the proposals received, and from the subsequent exploratory discussions held, that:

(a)

(b)

(c)

(d)

(e)

the cost estimates in the "Invitation to Submit Proposals" (Annex D) are reasonable and, if anything, perhaps slightly on the high side;

i

the MTR can be constructed within the time schedule envisaged in the Consulting Engineers' Mass Transit Further Studies Final Report. (Three consortia have, in fact, suggested that the construction period can be shortened);

the construction and equipment of the MTR can be organised either as one contract or a series of separate contracts. Each approach has its own advantages and disadvantages;

export credits should be available to cover between 45 and 70 percent of total capital costs (excluding interest), estimated at approximately $3, 500 million for the first four stages, and $9,800 million for the Full System;

the amount of export credits available is likely to be higher if the entire construction and equipment of the system is awarded as

one contract to a single overseas consortium,

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