TNAG-1391-FCO40-1863-Future-of-Hong-Kong-briefing-for-meetings-and-visits-1985 — Page 95

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CONFIDENTIAL

Bids for the Tuen Mun project are currently being examined by the Hong Kong Government and an announcement on the companies who have been short listed for the project is imminent. Recent press reports from Hong Kong indicate that the British consortium led by GEC will be amongst those selected.

Tenders for the second harbour tunnel project were submitted to the

Hong Kong Government on 1 April. Costains, Trafalgar House and Balfour Beatty (who have each formed separate consortia with local

or foreign partners to tender) represent British interests. A

decision on the successful bidder is not expected until next month.

Recent British project contract successes include the Castle Peak Power Stations, the Mass Transit Railway and the naptha gas plant.

7. The balance of trade is in Hong Kong's favour. In 1984 United

Kingdom exports accounted to £897 million whilst imports from Hong Kong totalled £1,267 million. During 1984 Hong Kong's exports of

manufactured goods to the UK rose by 31% in value terms whilst our

export of manufactured goods to Hong Kong rose by 23%. Clothing and

textiles account for 35% of all our imports from Hong Kong. This

is Hong Kong's most important and most sensitive

•

Although it

internationally. Of particular concern to Hong Kong is the policy

of HMG to the future of the Multi Fibre Arrangement.

does not expire until July 1986, the GATT Textiles Committee has to

consider in July 1985 whether it should be modified, extended or

discontinued. In April, the Hong Kong Government Office in London published a mid-term review of the current arrangement which

advocated the relaxation of restrictions on textile imports from

Hong Kong. Mr Eric Ho, the Hong Kong Secretary for Trade and Industry pressed Hong Kong's case during a visit to London and other EEC capitals earlier this month.

8. The UK has a 5.7% share of all foreign industrial investment in Hong Kong (together the USA and Japan account for 73%), but UK banks and service industries are strongly represented.

CONFIDENTIAL