TNAG-0426-FCO40-472-Construction-of-an-underground-railway-system-in-Hong-Kong-1973 — Page 157

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THE GOVERNMENT ANNOUNCED THIS EVENING THAT IT HAS DECIDED TO ENTER INTO NEGOTIATIONS WITH THE JAPANESE CONSORTIUM, REPRESENTED LOCALLY BY JARDINE, MATHESON AND COMPANY LIMITED, TO SEE WHETHER IT IS POSSIBLE TO CONCLUDE. A CONTRACT FOR THE CONSTRUCTION AND EQUIPMENT OF THE FIRST FOUR STAGES OF THE MASS TRANSIT RAILWAY. THIS DECISION HAS BEEN TAKEN FOLLOWING UPON A SERIES OF DISCUSSIONS WHICH HAVE TAKEN PLACE BETWEEN THE MASS TRANSIT STEERING GROUP AND THE THREE CONSORTIA WHICH HAD PUT FORWARD SINGLE CONTRACT PROPOSALS.

IN ANNOUNCING THIS DECISION A GOVERNMENT SPOKESMAN STRESSED THAT THE NEGOTIATIONS WILL TAKE A NUMBER OF MONTHS, BUT WILL BEGIN IMMEDIATELY. WHETHER OR NOT THE NEGOTIATIONS CAN BE BROUGHT TO A SUCCESSFUL CONCLUSION WILL DEPEND UPON THE JAPANESE CONSORTIUM'S ABILITY AND WILLINGNESS TO CONFORM TO THE GOVERNMENT'S DETAILED REQUIREMENTS FOR A CONTRACT.

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THE GOVERNMENT SPOKESMAN · SAID THAT ONE OF THE MOST IMPORTANT REQUIREMENTS LAID DOWN BY THE GOVERNMENT WAS THAT THE CONTRACT PRICE SHOULD BE LIMITED TO FIVE THOUSAND MILLION HONG KONG DOLLARS. THIS WAS BECAUSE IT WAS CONSIDERED THAT THIS WAS THE MAXIMUM SUM THE RAILWAY COULD AFFORD WITHIN A GIVEN FARE STRUCTURE AND BEARING IN MIND THE LONG PERIOD OVER WHICH THE DEBT HAS TO BE REPAID, RESULTING IN A VERY HEAVY INTEREST BURDEN. +THE JAPANESE CONSORTIUM'S PROPOSAL WAS THE ONLY ONE WHICH WAS WITHIN THIS LIMITATION,+ HE SAID.

SHOULD IT NOT BE POSSIBLE TO CONCLUDE A CONTRACT WITH THE JAPANESE CONSORTIUM, THE GOVERNMENT SPOKESMAN ADDED, CONSIDERATION WOULD BE GIVEN TO NEGOTIATING WITH ONE OR BOTH OF THE OTHER CONSORTIA, THE ANGLO-ITALIAN GROUP REPRESENTED LOCALLY BY HUTCHISON •. INTERNATIONAL AND THE ANGLO-FRENCH-GERMAN CONSORTIUM BY HONG KONG METRO CONSTRUCTORS.

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