TNAG-0425-FCO40-471-Construction-of-an-underground-railway-system-in-Hong-Kong-1973 — Page 95

2.

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improve the terms or presentation of their offer. If it is

their judgment that they can offer nothing better without a

substantial risk of loss, we may not be able to question their

commercial judgment, but would have to face the fact that this

very important contract would be won by the Japanese.

If, as

the Governor suggests, the consortium are holding back because

they believe that HMG will use political pressure on Hong Kong

to get the business for them, then we should disabuse them

while there is still time.

4.

If we tried to force Hong Kong to reject the Japanese

proposals and to accept a bid from us which they regarded as,

by comparison, unacceptable, we would have a constitutional

crisis on our hands. Some members of Hong Kong Executive

Council might well resign and the Governor's own position

would be damaged. Nor can we be sure that we would get the

Hong Kong might well decide not to proceed with the

scheme at all in its present form. We would then gain nothing

but the blame for Hong Kong's increasing traffic problem.

contract.

5.

If you think that doubt on this political point is

a factor which hinders the Anglo-Italian consortium from

reviewing their bid, I would be very willing to see Sir Arnold

Weinstock to explain the realities of the situation to him.

But we must act fast. The Governor says that there can be no

question of extending the 2 December deadline. We must take

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/this