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with specifically in the airport negotiations. But the Chinese will (rightly) see this as a new commitment for the SARG and they will want to discuss the whole question of contingent liabilities before agreeing to this specific
proposal.
21.
The Governor will let us have advice nearer the time
on points which the Secretary of State might make to Qian about the airport in the light of progress with the Chinese
in the meantime.
OBJECTIVES FOR CHINESE FOREIGH MINISTER'S VISIT
22. The HKG remain optimistic that the economy can absorb the strain of the airport project, and that their policy of fixed price contracts will keep costs under control. But the timetable remains extremely tight; and it is not yet clear that the capital markets will be willing to provide all the lending required.
23. On the British commercial interest in the project, the
Secretary of State and Prime Minister spoke to the Governor about the political importance of British firms securing a major part of the contracts. We have heard no more since then about HKG deliberations. Senior people from Trafalgar
House have been in Hong Kong and know that they must reduce the qualifications on their bid if they are to win.
24.
Issues for Discussion: have we got the balance right
between leaving Hong Kong to implement the Airport Project, and keeping a grip on aspects which could involve HMG (eg on consultation with China?) Is there any more we can do to promote the British commercial interests?
(v) Objectives for the Chinese Foreign Minister's Visit
25. These six monthly meetings with Foreign Ministers were
conceived as a means of breaking log-jams and adding impetus to the work of the JLG. Hong Kong issues should therefore
be a major element of the talks. But time will be at a
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