TNAG-2079-FCO40-2959-Hong-Kong-press-coverage-and-reports-1990 — Page 74

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MDLIAN 6936

11. THE CONVENOR OF THE LEGCO AD HOC GROUP ON THE FINANCIAL ARRANGEMENTS FOR THE NEW AIRPORT PROJECT, STEPHEN CHEONG, SAID THAT FOLLOWING A BRIEFING BY DEPUTY SECRETARY FOR MONETARY AFFAIRS JOSEPH YAM ON THE COMPONENTS, FUNCTIONS AND WORKINGS OF THE EXCHANGE FUND WAS ONLY ONE OF THE FACTORS TO STABILISE THE HK DOLLAR, THE MEDIA (19.12) REPORTED. A LEGCO MEMBER WHO HAD ATTENDED THE AD HOC GROUP MEETING ON THE AIRPORT SAID THAT THE GOVERNMENT ESTIMATED THAT THE LAND FUND WOULD REACH HKD70 BILLION

BY 1997.

12. A MEMBER OF THE PROVISIONAL AIRPORT AUTHORITY, HO SAI-CHU, SAID (24.12 REPORTS) THAT PEOPLE'S CONFIDENCE IN THE HK DOLLAR DID NOT LIE IN THE AMOUNT OF THE EXCHANGE FUND BUT RATHER IN THEIR CONFIDENCE IN HK, ADDING THAT IF HK'S ECONOMY CONTINUED TO BECOME PROSPEROUS, FOREIGN INVESTORS WOULD HAVE FAITH IN INJECTING MONEY INTO THE TERRITORY.

13. A SOURCE CLOSE TO THE TOP LEVEL OF THE GOVERNMENT WAS QUOTED (24.12) AS SAYING THAT WHETHER THE MARKET WOULD ACCEPT LONG-TERM BONDS ISSUED BY THE GOVERNMENT FOR FUNDING THE LARGE-SCALE INFRASTRUCTURAL PROJECTS WOULD DEPEND ON WHETHER THE GOVERNMENT COULD CONVINCE INVESTORS THAT THE FUTURE SAR GOVERNMENT HAD THE

CAPACITY TO PAY BACK THE BONDS.

14. A GEOGRAPHY LECTURER AT THE UNIVERSITY OF HK, VICTOR SIT, SAID HE UNDERSTOOD THAT ONLY HKD 5.2 BILLION WOULD BE LEFT IN THE FISCAL RESERVES BY 1997 AS RELIABLE INFORMATION HE OBTAINED SHOWED THAT THE HK GOVERNMENT WOULD HAVE TO SHOULDER 80 PERCENT OF THE SPENDING ON THE AIRPORT PROJECT INSTEAD OF 50 PERCENT AS CLAIMED, SOME PAPERS (20.12) NOTED. A GOVERNMENT SOURCE TOLD THE HK ECONOMIC JOURNAL THAT THE FINANCIAL ARRANGEMENTS NOTED BY MR SIT REPRESENTED 'THE WORST CASE SCENARIO'.

15. ATV (21.12) SAID THAT THE HK GOVERNMENT HAD ESTIMATED THAT THE CONSTRUCTION OF THE TSING MA BRIDGE WOULD BE HKD5.3 BILLION AND THAT IT WOULD COST 30 PERCENT MORE TO BUILD A TUNNEL INSTEAD.

16. A DIRECTOR OF A LONDON INTERNATIONAL TRANSPORT COMPANY WAS QUOTED BY WEN WEI PO (21.12) AS SAYING THAT ANY DELAY IN THE COMPLETION OF THE NEW AIRPORT WOULD HAVE ADVERSE EFFECTS ON HK'S OVERALL INTERESTS AND THE DEVELOPMENT OF THE AIR CARGO TRADE. HE SAID THAT THE NEW AIRPORTS IN MACAU AND SHENZHEN WOULD BE TOO SMALL TO BE OF MUCH HELP IN EASING FREIGHT CONGESTION AT KAI TAK AIRPORT.

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