Tung faces Cyberport pressure

Chief executive asked to explain how project was awarded soon after top official queried key issues

Chief Executive Tung Chee-hwa is under pressure to explain how a decision to award the controversial Cyberport project to Richard Li Tzar-kai's Pacific Century Group was made soon after a top official queried five key issues.

The issue was raised after the government released to lawmakers 24 letters it exchanged with the Pacific Century Group. Their release was part of the administration's efforts to prove an absence of collusion with the business sector.

The documents showed that former secretary for information technology and broadcasting Kwong Ki-chi, in a letter to Mr Li on January 26, 1999, asked why the project should be given to Pacific Century Group and not to another developer or awarded through an open tender. He also asked why Telegraph Bay was picked as the site, why the development included a residential component, and why Cyberport and the information technology sector were selected in the first place.

Written responses from Pacific Century Group dated January 27 and February 3, also released yesterday, did not address these concerns, although the first said: 'We agree that residential property is an integral part of the Cyberport design.' The second response did not address any of the five concerns.

However, on February 11, Mr Kwong wrote to Mr Li, saying: 'The government fully endorses the proposed development of the Cyberport.' A detailed cash flow analysis was included in the letter.