16-SEP-1992
16:20
BRITISH TRADE COMM
P.02
BC-CHINA-CONSTRUCTION
By Fidelia Chau
China firm criticises H.K. on airport tender
SINGAPORE, Sept 15, Reuter - The Hong Kong government is unfairly favouring British companies in awarding work on a giant airport and port project, a senior official of a Chinese state construction firm said on Tuesday.
Xu Peng, vice president of state-owned China State Construction Engineering Corporation (CSCEC), said to date all five tender awards for preparatory work on the project had been won by British interests favoured by the colony's authorities.
"Obviously, the Hong Kong government awarded the contracts to the consortiums of heavy British interest, Xu told Reuters in an interview during a visit tol Singapore.
"We found that the Hong Kong authorities concerned are strongly favouring the British companies. We have given our objections to the Hong Kong government on that," Xu said.
Xu said CSCEC is now negotiating with British firms to bid jointly for other airport work in the hope of winning contracts.
"We are now lining up (with) some British companies to bid (for) the work but not all British companies are being favoured, " said Xu, who declined to name any of the British firms.
Xu said most international contractors are eager for part of the HK$175 billion (US$22.5 billion) airport and port project. Hong Kong reverts from British to Chinese sovereignty in 1997.
The awards so far involve five of 10 preparatory projects covering work on new town development, land reclamation and building of a highway section and two bridges.
Xu declined to be specific about the Hong Kong government's alleged favouritism in contract awards, except to say that the colony's authorities were interpreting content and terms of proposed contracts in a biased way.
Xu denied speculation in Hong Kong financial circles that China was holding back full endorsement of the giant project as essential for its successful financing by banks way to produce project work for Chinese firms.
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"The speculation is completely unfounded, said Xu, adding that China's objections are "mainly because the cost increased too much. "
"The original estimate for the airport was about HK$112 billion ($14 billion), then it increased to 170 billion ($21 billion), and now the total investment may reach more than 200 billion ($25 billion), Xu said.
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He said CSCEC will join in bidding for the five remaining preparatory core works for the airport.
Xu was in Singapore to open a CSCEC subsidiary, China Construction (South Pacific) Development. CSCEC, one of the 20 enterprises directly reporting the Beijing central government, had turnover of U.S.$500 million in 1991, he said.
REUTER
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