TNAG-2493-FCO40-3625-Future-of-Hong-Kong-constitutional-development-Chinese-reac-1992 — Page 176

1992-10-19 17:38 INFORMATION SERVICES DEPT

862 521 7725 P.04

NEW AIRPORT

Vice director of NCNA HK Zhang Junsheng, in response to remarks by CS Sir David Ford on the airport, was noted as saying that the question of the airport was not whether a ceiling could be put on the cost but that the British package had gone far beyond the MOU. Mr Zhang said that the Chinese disagreed with the British financail proposals because of the inclusion of callable equity, the rising cost and the use of the SAR fund. He said that the Chinese had always tried to cooperate in the talks and had raised a number of suggestions, including the addition capital injection. But the British had counter proposed to sell the related land in one go and to put all premiums, including the SAR's share into the airprot and the railway. He said that the Land Fund was meant to be the SAR's reserves. when the Chinese proposed to keep $25 billion as reserves for the SAR, it had taken the Land Fund into consideration. Now that if the SAR's Land Fund was to be depleted, what would be the use of leaving $25 billion to the SAR, Mr Zhang asked. He also said that according to the MOU, the British-HK Government was responsible for the airport. The Governemnt was keeping all documents and it would not be possible to ask the Chinese to suggest any package.

Ford

Sunday papers: CS Sir David/was noted to have said that it would not be possible to put a ceiling on the airport costs because of inflation factor which was difficult to predict. Sir David also said that the airport plan was cost-effective and that all the contracts awarded so far were all below the estimated cost. The propaganda head of the NCNA HK, Sun Nansheng, was noted to have refused to give a direct answer when asked whether the Governor's Peking visit would solve the airport question. He had instead quoted an Aesop fable to the effect that those who were cunning and scheming towards their friends would eat their own bitter fruit.

Legislator Samuel Wong said that the sirprot issue had been politicised, adding that worldwide building industry was in the low ebb and were keen for business, so that the Chinese need not be too worried about the cost. David Li, speaking/Peking, said he believed that airport issue would be solved soon, adding that the banking sector would await outcome of the govenror's Peking visit before deciding on the attitude towards lending to the airprot projects.

RAYMOND CH'IEN

Exco member Raymond Ch'ien, in an interview with CNA, said that he hoped both the Chinese and the British would look at the airport financial package from an economic point of view, because if the talks should fail, HK's prosperity and stability would be affected. CBF

The HK Economic Journal noted that CBF Major-General John Foley agreed with the Govenor's decision not to appoint CBF into Exco. He also said that he would at the appropriate time get in touch with those in charge of PLA in China to discuss the question of the handover of the military in 1997.

DELEGATION

A government delegation to China led by D of E Dominic Wong left for Peking yesterday. It was noted that the visit had nothing to do with the Governor's coming Peking visit, but members of the delegate would exchange views with Chinese officials on Mr Patten's policy address.