TNAG-0508-FCO40-573-Construction-of-underground-railway-system-in-Hong-Kong-1974 — Page 82

MR BRYANT

OFP2

COMMERCIAL IN CONFIDENCE

Reference..

cc Mr Roberts CRE2

Mr Stuart FCO Mr Cotterill ECGD

خطا

HONG KONG MASS TRANSIT

Mr Stuart in the FCO recently told me that the Governor of Hong Kong would shortly be in the UK and it seemed inevitable that in one form or another the question of the mass transit scheme would come up. The latest press cuttings (attached) from Hong Kong certainly suggest that Hong Kong may have problems.

With Mr Stuart's agreement I asked Mr Kline of GEC-Elliott Automation whether there had been any developments following the brief exchange with the Japanese and whether they had any points they would wish to see made to the Governor should he confirm that there were in fact problems in keeping the Japanese to their promises. Mr Kline said that there had been no further response from the Japanese despite a gentle reminder from GEC-Elliott Automation. If there were any thought of telling the Governor about the Japanese approach and the response from GEC, GEC would like to let Lord Nelson know because Lord Nelson had been somewhat concerned that policy had dictated that he should withhold from the Governor knowledge of the Japanese approach when he, Lord Nelson, called on the Governor in Hong Kong. I have agreed with Mr Stuart that we will certainly give Lord Nelson an opportunity to comment before mentioning the Japanese approach to the Governor.

Mr Kline told me that, looking at the negotiations over the mass transit contract with the benefit of hindsight, GEC-Elliott Automation had come round to thinking that they and others had been mistaken in encouraging the Hong Kong government to look for a single contractor to undertake the whole project. It would have been probably in the interests of both British industry and Hong Kong had those voices in the Executive Council who wished to see the project split up into a number of discreet operations been heeded, Had this happened the civil engineering work in particular might have been carried out to common standards laid down by consultants by a number of firms each of whom might have been a specialist in a particular type of civil engineering work. Costains, for instance, would have had a good chance of bidding for the tunnel under the Sound since they had just completed one. There might have been other companies, eg the Italians, who were particularly skilled at the on land tunnelling. Again, there were British and possibly other companies who might have been particularly skilled at the cut and cover tunnelling. To some extent the same division of labour might have been possible for the electrics and mechanics. One company might have taken the signalling and control systems, another the rolling stock and traction. Had the project been split up in this way British companies might well have secured parts of it, the risk would have been spread and more measurable and the Hong Kong government might well in the end have achieved a more economic job.

Mr Kline said that, again with hindsight, he thought that one of the considerations which had weighed heavily in the original advice - the fact that the system had to be of a certain minimum size before it could hope to attract enough custom to be viable was not really a particularly good argument for insisting that one company had to undertake all the work.

J

L10016 N449108/633443 100,000 11/09 KP3601

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