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repercussions in Hong Kong might be damaging to our
interests. For it would appear that Hong Kong
consumers were being required to bear the consequences
of uncompetitive contracts from Britain and were
being denied the benefits of more competitive bids.
Given prevailing attitudes in Hong Kong, this could
make it difficult for Sir Lawrence Kadoorie to
persuade his board and shareholders that the British
tender was acceptable. The Senior British Trade
Commissioner in Hong Kong, who knows Sir Lawrence
well, shares this view.
In my Minister of State's view, these factors make
it imperative that British companies present Sir
Lawrence with a package which makes it unnecessary
for CLP to invite tenders internationally. As I
promised in my letter of 3 May we will keep you
fully informed of developments.
Against this background, if the Prime Minister
agrees, we suggest that our Ambassador in Tokyo
should not be asked to take any initiative in this
case. If, however, following the discussion between
the Prime Minister and Mr Fukuda, the Japanese
approach him, he should confirm that HMG attaches
the greatest importance to British firms winning orders
for new power generating plant in Hong Kong, but he
should not ask in terms for the Japanese Government
to intervene with their own industry.
Continuation Sheet No. 1
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2499/2152L 0527586 10M 1/77 TP Gp 3628; 2
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