TNAG-2146-FCO40-3065-Hong-Kong-Port-and-Airport-Development-Strategy-(PADS)-1990 — Page 165

3

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60% of the cost of PADS.

to take into account the

5. On the basis of data established (at the level considered appropriate for a strategic study), we estimated in 1989 that the private sector should fund 40%

(If these figures were adjusted recent decision that Government not the private sector will build the Lantau Fixed Crossing, the higher range of private sector share decreases to 55%. The lower range does not assumed that Government take over this

change as it already project.)

6.

In anticipating

а

substantial

private sector participation, we were very much building on our successful experience. In particular, it is worth noting that major projects like the Mass Transit Railway, the Cross Harbour Tunnel, the Eastern Harbour Crossing, the Tate's Cairn Tunnel, the container terminals, and a range of major tenant facilities at the Kai Tak Airport (such as air cargo terminals and aircraft maintenance facilities) have in the past been largely or wholly funded by the private sector.

PRESENT POSITION

7.

Since October 1989, financial planning has advanced on various fronts, including

(a)

the completion of the financial study on the Lantau Fixed Crossing and the Administration's decision to finance the project instead of inviting bids on a

'Build, Operate and Transfer' basis.

There are programming and cost advantages in this approach because of the uncertainties surrounding the project. These uncertainties include the risks perceived by private investors, the world economic slowdown and the Gulf crisis. This approach enhances the certainty of the whole programme and a better

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