TNAG-0850-FCO40-1060-Future-of-Hong-Kong-New-Territories-leases-1979 — Page 22

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HK future five

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issue in the Far Eastern Economic Review of 10 Dec 1976. Having run through

e usual comforting arguments about the reluctance of China to take Hong Kong

back ( its hard cash earnings, the problems of integrating the people, the showcase and intelligence value of HK to China, etc.) he goes on to say:

But it is essential that the world business community continues to

consider Hong Kong a good risk in terms of profits. It has been

axiomatic until now that any investment in Hong Kong should be

amortised and yielding profit within about seven years at the most

and more usually in two..

The problem is usually posed in these terms: how can the Hongkong

Government persuad local people or outsiders to invest in Hongkong

after the mid 1980's, when it will not even have the legal power

to grant land-leases for more than a dozen years ahead.....

& valuable effect

He notes the reassuring value that the go-ahead with the Mass Transit scheme had on the fickle confidence of international financiers, but adds:

The Metro in itself in not enough.....What is vital is that it

should be only one of a series of continuing, successive, large-

scale interlocking projects for the development of Hongkong, which

will soothe international financial worries about the colony's

status and likely profitability.......

The key project now is a new airport......It has been suggested that the expence of such a project is beyond Hongkong's means. Phixxixxatxxa This is not so. The new airport can to a great extent be paid

for in the late 1980's by leasing off the existing Kaitak runway as real estate. But there will be a period of several years during which it xiit may be necessary to raise money on the inter- national market in order to pay for the development on Lantau before Kaitak becomes available for lease. This will be linked to the development of northern Lantau as a new industrial centre. And Lantau is part of the New Territories.

h

*

The speaker is tanked for kix making his sagacity and expertise available to us. We are now in a position to write down:

Fact No.5

The building of a second airport is not merely a necessity for pure transport purposes, but as part of a wider scheme of large-scale projects which must bex seen to be going ahead by international bankers in order that their confidence shall be maintained and thus provide finance for other, smaller