TNAG-0769-FCO40-973-Supplies-of-electrical-power-for-Hong-Kong-Castle-Peak-power-1978 — Page 51

COULD BE SEEN BY THE CHINESE S PRE-EMPTIVE. ON THE OTHER HAND, SINCE THE STORY HAS ALREADY BROKEN IN THE HONG KONG PRESS THERE MAY

BE NO DAMAGE TO BE DONE.

5. TO SOME EXTENT, THIS IS C.L.P.'S PROBLEM - THEY WANT TO SELL

THE ELECTRICITY AND BUY THE COAL. BUT WE OBVIOUSLY HAVE A CLOSE

INTEREST IN THE OUTCOME OF KADOORIE'S PROPOSAL, NOT LEAST FOR THE BUSINESS BOTH SIDES OF THE BORDER IT COULD BRING FOR BALFOUR BEATTY.

IT HAS ALSO BEEN SUGGESTED THERE COULD EVEN BE GREATER CHINESE

SENSITIVITY TO A U.K. GOVERNMENT ANNOUNCEMENT THAN TO ONE IN SIMILAR

TERMS FROM C.L.P. SO WE MUST CLEAR OUR GROUND BEFORE TAKING CREDIT

FOR THE ADDITIONAL POUNDS STERLING 12M WHICH, FOLLOWING SIR SIDNEY GORDON, WE IN D.0.1. SHOULD, OTHER THINGS BEING EQUAL, LIKE TO DO. OUR REFERENCE IS, AS YOU CAN SEE, QUITE LOW KEY.

6. AFTER CONSULTING HEYWOOD AND THOMPSON WE THEREFORE REQUEST THAT

YOU TAKE THE FOLLOWING STEPS:

(A)

CONFIRM WITH C.L.P. THAT IT IS THEIR OWN PRESENT INTENTION TO REFER TO THE SPUR LINE, AND IN WHAT TERMS. OUR PRESS

RELEASE MUST AFTER ALL BE CONSISTENT WITH THEIRS.

(B) PUT IT TO C.L.P. AS H.M.G.'S ADVICE THAT THEY SHOULD ENSURE

WITH THOSE WITH WHOM THEY ARE DEALING THAT AN ANNOUNCEMENT

IN THOSE TERMS WOULD BE ACCEPTABLE TO THE CHINESE AUTHORITIES

IN RELATION TO THOSE NEGOTIATIONS:

(C) YOURSELF CONSULT THE HONG KONG GOVERNMENT TO ENSURE THAT THEY

WOULD BE CONTENT FROM THE POLITICAL POINT OF VIEW (NOT JUST THE RATHER NARROWER FINANCIAL INTEREST OF JEAFFRESON) FOR SUCH AN ANNOUNCEMENT TO BE MADE, WHETHER IN HONG KONG (WHICH YOUR INDUS 216 NOTES THAT C.L.P. WOULD NEED TO HAVE CHECKED)

OR BY D.0.1. IN THE U.F.

7. YOU WILL WISH TO ALERT ODELL IN CONFIDENCE TO THESE CONSIDERA-

TIONS. BALFOUR BEATTY'S OWN ANNOUNCEMENT MUST FOLLOW WHATEVER LINE

IS AGREED.

8. (FOR PEKING) WE REQUEST ANY ADVICE FROM PEKING ON THESE MATTERS, AND WOULD WELCOME ANY INFORMATION, CONFIRMATORY OR OTHERWISE, THAT THEY MAY HAVE ON THE CHINESE RESPONSE TO KADOORIE'S PROPOSALS.

9. I SHOULD BE GRATEFUL FOR SOME RESPONSE (ALSO FROM PEKING) TOMORROW, THOUGH THE TEXT NEED NOT BE FINALSISED IN EVERY DETAIL UNTIL MONDAY. YOU WILL NO DOUBT IN ANY CASE BE REPORTING ON C.L.P.'S BOARD MEETING. HAVELOCK AND I MAY TRY TO TELEPHONE TOMORROW AFTERNOON (LOCAL).