TNAG-1518-FCO40-2079-Hong-Kong-International-Airport-1986 — Page 48

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(C) IF WE WERE TO RECOGNISE THE LONG-TERM CAPACITY PROBLEMS AT

THE AIRPORT AND THE NEED FOR VERY SUBSTANTIAL CAPITAL INVESTMENT IN THE EXISTING OR A REPLACEMENT AIRPORT BEFORE THE END OF THE DECADE, WOULD THIS GO FAR ENOUGH TO RENDER THE ACCUMULATION OF AN AIRPORT DEVELOPMENT RESERVE ACCEPTABLE WITHIN THE INTERNATIONAL GUIDELINES? THE PLAN FOR THE REPLACEMENT AIRPORT HAS BEEN SHELVED ON FINANCIAL GROUNDS, AND THE REALISTIC WAY OF TACKLING THE PROBLEM IN THE LONG RUN WOULD BE TO ACCRUE THE FINANCE IN ADVANCE. THE SAME IS TRUE OF ANY MAJOR EXPANSION OF THE EXISTING AIRPORT.

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(D) GIVEN THAT THEY ARE NOT USED IN THE INTERNATIONAL GUIDLINES,

AGREEMENT ON THE EXACT MEANING OF TERMS SUCH AS 'MARGINAL COSTS'' (POINT IV), ''LONGER RUN MARGINAL COSTS' (POINT V) AND FULL ECONOMIC COSTS' (POINT IX), IN THE CONTEXT IN WHICH THEY ARE USED, WOULD BE USEFUL.

A: PAS(ES)A

D: JUA(ATIN: MR. CE JONES)

DFS(ATIN: MR. P. BROOKE) FILE NO: CR 59/581/73 III joe

St