CONFIDENTIAL
050704
MDLIAN 7531
THE
ANTICIPATED IN THE IMPLEMENTATION OF PROJECT WORK
(AS DISTINCT FROM THE SHARE-HOLDING ARRANGEMENTS IN THE CONSORTIUM ITSELF). MANZIE IS CONCERNED ABOUT THE CONTINUING JAPANESE PRESSURE FOR THEIR SHARE OF THE WORK TO BE SUBSTANTIALLY HIGHER THAN 50 PER CENT. CURRENT CAUTION OF BRITISH BANKS TOWARDS PUTTING UP FUNDS FOR THE PROJECT IS NOT HELPING TH. SCHRODERS HAVE TOLD US THAT BARCLAYS ARE CURRENTLY REFUSING TO LEND BEYOND 1997.
4.
WE HAVE EMPHASISED THAT IT WILL SIMPLY BE UNACCEPTABLE TO US IF THE WORK-SHARING ON THE PROJECT
IS STRUCTURED ON A BASIS WHICH GIVES THE JAPANESE THE
LION'S SHARE. HMG WOULD SIMPLY DECLINE TO SUPPORT SUCH ARRANGEMENTS. TH SAY THEY UNDERSTAND THE POLITICAL REALITIES, BUT THIS IS AN ISSUE WE WILL HAVE TO KEEP A CLOSE EYE ON. THERE IS HOWEVER A TENDENCY FOR THE JAPANESE
TO DISCOUNT HMG'S ABILITY SERIOUSLY TO INFLUENCE THE
HKG OVER PROCUREMENT SO THAT WITHDRAWAL OF SUPPORT CUTS
LITTLE ICE.
5. MANZIE IS KEEN THAT WE SHOULD TAKE THE MATTER
UP WITH MITI AT A SUITABLE MOMENT. AS YOU AND TOKYO KNOW, WE HAVE DONE SO IN THE PAST, THOUGH WITH INCONCLUSIVE RESULTS. GRATEFUL FOR ANY COMMENTS FROM
TOKYO ON RIGHT WAY FORWARD.
THE CHINESE DIMENSION
6.
THE QUESTION OF PRC SUPPORT FOR THE AIRPORT
PROJECT IS AN INCREASINGLY LIVE ONE FOR THE CONSORTIUM WHO EMPHASISE THAT, AS WE ALL KNOW, THE ATTITUDE OF POTENTIAL INVESTORS WILL BE HEAVILY
INFLUENCED BY THE PRC VIEW. WE ASSURED MANZIE THAT THIS POINT WAS WELL TAKEN. THE GOVERNOR TOUCHED UPON IT AT HIS MEETING WITH MR RIDLEY (SEE PARA 5 OF MY OTTER 44) AND PIERS JACOBS AND MICHAEL LEUNG ALSO ADVOCATED EARLY CONTACT WITH AND INVOLVEMENT OF THE CHINESE IN DISCUSSIONS HERE IN MARCH.
7. WE BRIEFED MANZIE ON LORD YOUNG'S RECENT MEETINGS WITH LI PENG AND OTHERS. MANZIE SAID THAT WHAT HE WOULD IDEALLY LIKE TO DO IS TO HAVE A MEETING WITH LI PENG, NO DOUBT INFORMALLY ARRANGED BUT BLESSED BY HMG: THE RECENT MEETING WITH SIR ROBERT DAVIDSON
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