TNAG-2960-FCO40-4239-Future-of-Hong-Kong-British-Consulate-General-building-incl-1993 — Page 95

CF/HKG/3001/2

FAX

071-389 4786

Mr Alex Smith

Overseas Estates Department

IN CONFIDENCE

Mr Woodrow

On decu! 1513 Miss

Furs BJ

M12/3

pa building.

26

11 March 1993

R

HKD 406/2

1 5 MAR 1993

P

HONG KONG: NEW CONSULATE GENERAL

1.

2.

3.

Thank you for sending us a copy of OED's draft submission to Mr Hum.

Unfortunately we are unable to support it as it stands.

You will know that the Council's operation in Hong Kong is heavily dependent on the economic well-being of its English classes in what is a volatile market.

4. In agreeing to become involved with the new Consulate General project the Council has taken some risks, particularly in deciding to move the site of our large volume English language teaching operation despite being in a market where location has proved a critical factor. However we appreciated the need to establish a major British official presence in post-1997 Hong Kong and agreed to the proposed move into the Consulate General compound on the basis of a deal that offered us no capital cost and no rent beyond a proportion of the ground rent. We recognised these as major financial benefits though our initial estimates suggest that they could be largely offset by the considerable increase in running costs required for the new building and compound.

5.

In view of this we cannot accept any suggestion that the Council might take on extra unexpected and unquantified costs.

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