TNAG-2407-FCO40-3500-Airport-issues-in-Hong-Kong-Provisional-Airport-Authority.-W-1992 — Page 3

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CALL ON MR HUM, AUSS, BY MR RICHARD ALLEN, CHIEF EXECUTIVE

OF THE PROVISIONAL AIRPORT AUTHORITY: 12 JUNE

Mr Allen handed over a pack of financial details on the airport which had recently been made public and explained the position that the Provisional Airport Authority (PAA) had now reached. The PAA now had 300 staff, and the airport

business and master plans were complete. They were now building up the operational and commercial side of the PAA. There was still a great deal of work to be done: some 27 consultancies and 50 construction contracts would have to be

let in due course. Work on site was progressing well: Shek

Lap Kok island had now been flattened. The PAA had bought

US $40 million worth of construction equipment for use on

the island.

Mr Allen said that he had already initiated talks with banks

and ExIm banks about lending to the PAA. These were

currently initial discussions: the PAA would need actual

funds in about the middle of 1993. Before the PAA could let

the major platform formation (and dredging) contract, they would need to get additional equity funding from the Finance

Committee. Once that was forthcoming, they would not in

fact need further funds until about 1994. But clearly they

would have to commence borrowing from banks before the equity ran out.

Mr Hum asked whether, it was still genuinely realistic that

the airport could be built by 30 June 1997. Mr Allen said

that he thought the date was achievable - based on historic

performance patterns in construction contracts in Hong Kong.

He said that many aspects were on side: the sluggish world

economy meant that there were many consortia looking for

construction work; the labour market in Hong Kong was not

overly tight; and the Hong Kong Government had delayed some

construction projects and therefore the construction

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