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SECRET

DRAFT

ANNEX F

Statement by the Mass Transit Railway Provisional Authority

(to be issued in the event of

the Governor in Council rejecting the Consortium's offer of

compensation.

Embargoed until

Executive Council has met on

14th January 1975)

Japanese Consortium withdraws from

Negotiations

The Japanese Consortium has

informed the Mass Transit Railway

Provisional Authority that it is unable

to continue negotiating a contract to

build, equip and finance the first four

stages of the Mass Transit Railway

within the context of the Letter of

Intent signed on 15th February 1974.

2.

The Consortium has given, as

its reason for deciding to withdraw from

the negotiations, the difficulties

experienced by the Japanese economy as a

result of the oil crisis in late 1973

and 1974. The Consortium claims that

the magnitude of these difficulties

could not have been reasonably foreseen

at the time it signed the Letter of

Intent and that they could not now be

surmounted. At a meeting held in

November 1974 the Consortium asked for

SECRET

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