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Finance
Mr
3. Mr Wu said that Hopewell would take 20% of the equity. Li Kashing of Cheung Kong Holdings had expressed willingness to take the remaining 80%, but he had wanted to spread participation more widely. The Hong Kong and Shanghai Bank and Citibank were ready to go in and so was the Bank of China. CPA also wished to take a
stake.
Phasing
4. I asked Mr Wu whether the project could be executed and financed
it in phases rather than as a single enterprise. He said that could. The road link from the border to Hong Kong Island Could
this toos stand alone. If the port facilities were added it would also be financially viable. So too would the full project involving a road, a port, an airport and residential building on the land reclaimed in connection with the airport development. Financing at every stage would be assured by the private sector, although after construction
be the airport would sold to the Hong Kong Government.
Chinese Involvement
5.
Mr Wu said it was self-evident that the Chinese Government would have to be ready to support the project. He had described the general concept to both Premier Zhao Ziyang and Vice Premier Gu Mu: both had said they were ready to give their support. He believed that PRC enterprises were ready to be involved in the main consortium, to participate in the separate contractors' consortium and to participate in financing through the Bank of China. had said that the State Council would be responsible for identifying
the right participants.
6.
Gu Mu
Xu
Mr Wu said he had also gone over the ground with Xu Jaitun. had confirmed that the PRC would be ready to participate in the equity and the financing. The 50 hectare annual limit on land disposal (which would have to be breached several times over for the project) was "negotiable". Xu had encouraged him to arrange a visit
to reking after Chinese New Year to explain his ideas in more detail to the State Council.
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