TNAG-0768-FCO40-972-Supplies-of-electrical-power-for-Hong-Kong-Castle-Peak-power-1978 — Page 77

C0 BTC HONG KONG

GPS 250

DESK BY 220100Z

CYPHER CAT A

HKK 164/1

INDEX

OFFICER

РА

* REGISTRY

Action Taken

Mr The

FM DTI 21191OZ

CONFIDENTIAL

DESK BY 22010OZ

TO IMMEDIATE BTC HONG KONG TELNO INDUS 215 OF 21 SEPTEMBER.

FOR MARCH FROM THORNTON

UNITS 3 AND 4

1. MIFT IS ADVANCE TEXT OF LETTER OF 21 SEPTEMBER FROM JOHN LIPPITT TO SIR LAWRENCE KADOORIE, WHICH WE SHALL DELIVER BY HAND NEXT WEEK, PLEASE PASS IT TO SIR LAWRENCE.

2. YOU WILL SEE THAT LIPPITT SUGGESTS THAT HAVELOCK (AND I) SHOULD DISCUSS THIS WITH KADOORIE DURING NEXT WEEK, WHEN WE BELIEVE HE WILL BE IN HONG KONG. WE SHALL BRING WITH US A DRAFT ''LETTER OF INTENT**, ON THE LINES OF THE ONE I THINK YOU HAVE ALREADY SEEN. WE BELIEVE IT IS MUCH BETTER DISCUSSING A DOCUMENT OF THIS SORT IN PERSON SO THAT KADOORIE DOES NOT HAVE AN OPPORTUNITY OF REACTING OVER-RIGIDLY TO WHAT ON THE FACE OF IT MAY APPEAR A STRONGER DOCUMENT THAN IN FACT IT IS.

3. WE SHOULD NOT WISH TOO MUCH TO ANTICIPATE WHAT HAVELOCK WILL SAY TO KADOORIE. I THEREFORE SUGGEST THAT, IF THE OPPORTUNITY ARISES YOU SIMPLY STRESS THAT:

(1) THOUGH THE DOCUMENT WILL LOOK LIKE A LETTER OF INTENT IT WILL NOT (NOT) BE REGARDED AS SUCH BY THE DEPARTMENT OR BY GEC. THIS IS SIMPLY A DEVICE TO ENABLE ECGD TO MAINTAIN THE BASE DATE. IT WILL COMMIT KESCO NEITHER LEGALLY NOR MORALLY.

(2) THE EXTENSION OF THE SCHEME ITSELF IS OBVIOUSLY NOT SOMETHING THAT WE CAN GUARANTEE. BUT OFF-THE-RECORD IT SEEMS EXTRAORDINARILY UNLIKELY THAT AT THE VERY LEAST SUITABLE ARRANGEMENTS FOR CONTRACTS IN NEGOTIATION (SUCH AS THIS ONE) WOULD NOT BE MADE. (THIS IS OF COURSE A POINT ONLY TO BE MADE ORALLY).

4. COULD YOU MAKE ARRANGEMENTS FOR US TO MEET KADOORIE, TO DISCUSS THIS? I SUGGEST THAT IF HE IS AVAILABLE IT MAY ALSO BE RIGHT FOR DAVID GEMMILL TO BE WITH US.

5. PLEASE PASS COPY OF MIFT TO GEMMILL, AND SKETCH BACKGROUND AS IN THIS TELEX.

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