TNAG-1061-FCO40-1311-The-Kowloon-Canton-Railway-1981 — Page 38

CODE 18-77

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HKK 173/2

115

Reference....

Mr McQuad

McQua_319

COMMERCIA

Mr Williams 7.4.

KOWLOON AND CANTON RAILWAY

1.

IN CONFIDENCE

MKR 173/2

RECENDO IN BARRY NO. 51 0 4 SEP1981

во

PA

Action Take.

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10/4 rited fas Mas 7/4

DESK OFFICER

INDEX

•No! Maso.al

I spoke to Mr Benjamin in PEP in the Department of Trade on 2 September on the problem of Cost Escalation Cover for rolling stock for the KCR. He said that this was a very difficult issue because Metro-Cammell had by mismanagement increased their own commercial difficulties. The DOI were therefore discussing with the Laird Group the possibility of more direct group support for Metro-Cammell in order to avoid the latter company becoming another British Leyland to be baled out by the taxpaer. Until this was done Mr Benjamin thought there would be no point in further pressure on ECGD or the Treasury.

2.

I would be grateful if Hong Kong Section would keep in close contact with the DÕI and DOT on this question so that, as necessary, we can brief Ministers to weigh in again.

3 September 1981

R D Clift

the segue. As in pare 2pl. Sit rep on 10.9.81.

Overtaken

by

7)+

18

J 2.9.8.

RESTRICTED: COMMERCIAL IN CONFIDENCE

Mas

10.

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