TNAG-2472-FCO40-3599-Confidential-talks-between-the-UK-and-China-regarding-financ-1992 — Page 44

CONFIDENTIAL

Sewerage renewal was on ow shopping-list for April but there was no time to raise -Mr fx for trigically. I thought it had bee

it specifically

byx

Mr Stead of 8/6,

deferred post-97.

Mh Colsworthy bold me

~8/6_ an

て

Midz 101/2

MM FROM :

FROM: S H Broadbent リ

re para fi.

Had to financing innoted callable

equity going demand, 1997,

Mr Ricketts HKD

• Hal mone

hod Kought to tell He

DATE : 29 May 1992

cc: Mr Burns

Chinese. He was trying to kill off any thought of post-97 basilitres

HONG KONG: KY YEUNG

-

(44)

Jpa HKCG|FCO finlec dialogu

2915

somewhat

1. When he called on me yesterday, we spent most of our time nailing down the arrangements for the proposed Treasury visit to look at Hong Kong's public expenditure system akin to the job the Bank of England have done on the monetary system. I have reiterated throughout, both with HKG and HMT, that this is Hong Kong's initiative, and not something we are foisting on them. Details in a separate minute.

2. Yeung dropped a couple of small bombs. He mentioned that the next big expenditure project, on the financial arrangements for which he and others were now working, was replacement of the sewage system. This would cost as much as HK$20 billions, and might involve substantial private financing. The details were still being worked out. He did not think they would be a matter of concern to the Chinese. I was not so sure. This was exactly the sort of point we were anxious to anticipate in our visit in April. I urged him to give some thought to identifying other similar items, since it would be much easier to devise a strategy for dealing with the Chinese in full knowledge of all such contingencies. He took the point amiably, although it has been made before with not much result. We must keep at it.

3.

He also mentioned (assuming that I already knew) that HKG had "decided" to work with the CRC, following a meeting called by the Chief Secretary. This new policy had been endorsed by the Governor! At that point he went off to see Mr Patten, whom I do not suppose will necessarily be enthusiastic with ar such pre-emptive action.

l

SH Broadbent

Bil

overstated

CONFIDENTIAL