sr.5.19.8
12
HM Treasury
Parliament Street
London SWIP 3AG Telephone 071-270 4877
Q Mr Stone (already seen) M 2518
©
N A Lambert Esq
ECGD
مير
DAVID SEDDON
*
Масал
ак
NB 25/8.
HID
FED
HKA 182/4
مرسمه
the wll 20 August 1992
PO Box 2200
2 Exchange Tower
Harbour Exchange Square
LONDON
E14 9GS
Dear Norman
MACAU AIRPORT
Thank you for your letter of 17 Áugust. I have also seen Peter Casey's
letter of 18 August and Tim Downing's of the same
date.
The supplement to the May 1992 edition of "Euromoney" indicates that a principal role of the proposed airport will be as a "hub and spoke" airport for the region.
The hope is that international travellers will arrive at Macau in large aircraft and be transferred by smaller aircraft to destinations across China.
By setting up a dedicated terminal for incoming passengers for China, it might be possible to process passengers through customs and immigration before boarding onward flights to Chinese cities that do not have such facilities. There will, in addition, be the possibility of serving new markets in Vietnam, Lagos and Cambodia, to which I understand long haul flights are not always convenient.
While I realise the Treasury has a limited locus in this case, it seems to me there must be doubts about whether such hopes will be realised and about the viability of this project. The Chinese attitude is probably vital to the project's viability and from this point of view there seems every case for insisting on a Chinese guarantee not only for repayments due post 1999 but also as much pre-1999 risk as possible. On the other hand I accept there are difficulties in insisting on Chinese guarantees because of implications for Hong Kong. We are
also of course concerned
about adding to ECGD risk in China.
It does seem essential, if ECGD are to offer cover, that adequate security is obtained to ensure that no losses should be made by ECGD in the event of the project proving not viable. You will rely heavily on a joint and several liability which in the last
of resort would mean repayment by the Government
You assured me that ECGD has satisfied itself that in the event of a catastrophe the Government of
Macau could meet
Macau.
guarantees
of
Switchboard 071270 3000
Fax 071 270 5053
Telex 9413704
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