COMMERCIAL IN CONFIDENCE
would be with separate property developers (see page 15). He told me that the Corporation planned to issue invitations to major Hong Kong property developers to bid for the development of the sites on which stations will be located - see enclosed advertisement in the South China Morning Post which first appeared this morning. The Corporation do not plan to advertise in the United Kingdom because they do not believe that there is any property developer in the United Kingdom (or indeed in Europe) who would be prepared to invest the kind of money that will be needed in a project of this magnitude. Black explained that the Mass Transit Railway Corporation hope that one of the billionaire Hong Kong property developers (eg. Li Ka Shing, Fung King Hay or Sir Y K Pao) may be prepared to put up as much as HK$ 2 billion in order to secure the rights to develop a large number of the available station sites.
5.
Once the joint venture partners for the associated developments are chosen, the plan is that the MTRC would indicate the design requirement of the station and its associated access tunnelling leaving the property developer to complete the design with the assistance of a consulting engineer chosen from a short list approved by the MTRC (in practice, firms who are already well-established in Hong Kong) before issuing tender specifications to overseas contractors. The MTRC would remain in the background but would have the right to monitor and veto any development proposals which did not meet with the design requirements of the railway itself.
6.
This means that British civil engineering firms bidding for the Mass Transit Railway's station construction contracts will probably have to negotiate with Hong Kong property developers (mostly Chinese). It is therefore all the more important that they should establish good local working relationships with a) the property developer and b) a local Hong Kong construction partner. I very much hope that PEP Division will be able to establish British participation in both the tunnelling and station development aspects of this project which seems to me to provide an excellent opportunity for British construction firms to re-establish their presence in this part of the world by bidding for a series of project worth well-over million each.
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7. In so far as the E and M contracts are concerned (see paragraphs 5-6 of my letter of 11 December), it increasingly looks as if we ought to be able to conclude a series of negotiated contracts with the Mass Transit Railway Corporation who are obviously reluctant to change horses in mid-stream. I am pleased to say that Eric Harris, who was previously in charge of the Westinghouse Brake and Signal contracts, has been reassigned to the project by Hawker Siddeley. He has telexed the MTRC to announce that he will be coming to Hong Kong early in the New Year to talk about a possible further negotiated contract for the Island Line. The MTRC will probably continue to go through the motions of appearing to look at alternative sources of supply but I think that as a result of Norman Thompson's remonstrations to Arnold Hall we may well be able to keep the signalling contract for the UK. As already reported, Metro-Cammell seem very much in the running for the car contracts as do GEC and Henry Boot for the power contracts and the track contracts.
18.
a
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