TNAG-2142-FCO40-3061-Hong-Kong-Port-and-Airport-Development-Strategy-(PADS)-1990 — Page 30

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032707 MDHIAN 1615

CONFIDENTIAL

FM TOKYO

TO IMMEDIATE DTI

TELNO OTTER 534

OF 06075OZ AUGUST 90

AND TO IMMEDIATE BTC HONG KONG

INFO ROUTINE PEKING, FCO

HONG KONG AIRPORT PROJECT

RA

нис 182/2.....

RECE

~1990

CALL BY FLETCHER OF TRAFALGAR HOUSE (TH) ON 30 JULY REVEALED GROWING OPTIMISM THAT THE ANGLO-JAPANESE CONSORTIUM WAS AT LAST TAKING SHAPE (MARUBENI AND MITSUI ON BOARD AND C ITOH, NIPPON STEEL, IHI AND NKK TO JOIN OVER THE NEXT 3/4 WKS). KUMAGAI (MITSUI) EMPHASISED THE IMPORTANCE FOR MITSUI OF THE UK ANGLE BUT OFFERED NO COMMITMENT ON SPECIFIC WORK-SHARES. MITI (6 AUGUST) HAVE UNDERTAKEN TO ENCOURAGE JAPANESE ELEMENTS TOWARDS A COORDINATED APPROACH.

DETAIL

2. TH VIEW NIPPON STEEL AS THE CRUCIAL ELEMENT AT PRESENT: THEY ARE ONE OF ONLY TWO FIRMS CAPABLE OF SUPPLYING THE

SUSPENSION BRIDGE CABLE THE OTHER BEING KOBE STEEL. IKEDA, EXEC VP AT MITSUI, THE SENIOR MAN HANDLING THE PROJECT, HAD ASSURED THEM THAT DISCUSSIONS WITH NIPPON STEEL WERE GOING WELL: THE THREAT OF RIVAL CONSORTIA SEEMED TO HAVE SUBSIDED. MITSUI HAD ALSO ENLISTED THE FINANCIAL BACKING OF THE INDUSTRIAL BANK OF JAPAN, THE LONG TERM CREDIT BANK AND TOKYO, FUJI AND MITSUI TAIYO KOBE BANKS. THE HEAVY ENGINEERING FIRMS IN PARTICULAR WERE CONCERNED BY THE FINANCIAL RISKS INVOLVED IN A PROJECT GOING BEYOND 1997 AND ANY POLITICAL RE-ASSURANCE WAS WELCOME.

3.

1 T

I CALLED ON PRESIDENT KUMAGAI (MITSUI) ON 1 AUGUST AND MADE THE POINTS IN FCO TELNOS 452 (17 JULY) AND 485 (31 JULY). KUMAGAI WAS INTERESTED IN MR MAUDE'S DISCUSSIONS AND THE CHINESE ACKNOWLEDGEMENT THAT A NEW AIRPORT WAS NECESSARY. HE ALSO APPEARED TO TAKE THE IMPLIED MESSAGE THAT MITSUI'S ABILITY TO ''DELIVER' THE JAPANESE SIDE IN THE NEAR FUTURE WAS ESSENTIAL TO THE SUCCESS OF A PRE-EMPTIVE BID BY THE AJC. HE SAID THAT IKEDA WOULD REPORT ON DEVELOPMENTS THIS WEEK. THE UK INVOLVEMENT WAS SEEN AS A PRE-REQUISITE, ALTHOUGH SPECIFIC PERCENTAGE WORK-SHARES COULD NOT BE USEFULLY DISCUSSED UNTIL CONCRETE COMMERCIAL NEGOTIATIONS STARTED.

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