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16.
It was agreed that if the Chinese did state in the JLG meeting that they had decided to set up their own committee to scrutinise franchises and contracts, we should take the line that it was up to them to decide whether they wished to seek advice from individuals in Hong Kong, but we would remind them of the statements they have made in the past in which they have said they are not interested in which company is awarded a particular franchise. We would also re-emphasise that any commercially sensitive information which we passed to them could not be transmitted to third parties.
17.
The point was made that most of the franchises coming up for discussion in 1993 would involve China's best friends. It would be uncomfortable for Peking to take a negative attitude to these, and would of course conflict with their statement that they would take a positive attitude generally to post 1997 investment.
Airport
18.
The CS referred to our public statements that we wished to reach a deal with China as soon as possible. He was constantly asked whether we had proposed new talks and, if not, how this fitted with our stated policy. He wondered whether we should consider making a new proposal to the Chinese, which would be above our actual bottom line, in order to retain PR advantage. He accepted that it would of course be swallowed without our obtaining agreement. The Governor said that he did not want to take a decision on this immediately. We needed to bear in mind the dangers of appearing to be desperately anxious. Tony Galsworthy said that in negotiating terms the CS's proposal had nothing to commend it. The Governor suggested that further thought should be given to this question. He asked to see a proposal of what we might say to the Chinese if we were to call a meeting.
19.
FS said that he was still considering the question of the Central/Wanchai reclamation. Obviously we must not go to Finance Committe and lose. Consideration could be given to phasing the project in a way that excluded the railway reclamation from the early work. That could produce more support in Legco. But further thought needed to be given on whether and how to tell the Chinese of any such possibility, and whether to seek to ascertain their views (probably negative). He undertook to put his considered views to the Govern. shortly.
Land
20.
It was agreed that if there was a slide in the property market, this would have a considerable impact on the
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