CONFIDENTIAL
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Sir D Watson
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HONG KONG SHIPPING REGISTER
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13/12
1. Mr Y K Pao has been having a further series of meetings with the Minister for Aerospace and Shipping. DTI officials have been trying to slow things down. The transfer of the register appears already to have been conceded. But they have prayed in aid the Hong Kong Government's proposals that manning standards at Master level should remain as at present, that only certain Western European certificates should be acceptable for junior officers and that these junior officers must be British nationals or long term residents of Hong Kong. It does not seem to have been established at Mr Heseltine's meeting whether Mr Pao would accept these proposals as being sufficient to justify the transfer of his ships to a Hong Kong register, or whether he would hold out for the acceptance of all foreigners with all certificates at all levels.
2.
The DTI are now instructing their Deputy Secretary,
Mr Hubback, who is at present in the Far East, to seek an interview with the Governor of Hong Kong. The DTI hope for confirmation that the Hong Kong Government's own proposals are a maximum and not a minimum, and for an assessment from the Governor of whether changes of that magnitude would in fact be enough to attract more ships onto the Hong Kong register, or whether they would merely lead to pressure for more concessions from Mr Pao.
3. I have said that I would see no objection to Mr Hubback discussing the situation with the Governor, but that, on the possibility of further demands from Mr Pao, it would be wise not to imply that the Hong Kong Government was not capable of withstanding such pressure.
4. I do not think there is need for us to muddy the waters by writing to the Governor separately from Mr Hubback's approach, which he will make direct. Sir Murray MacLehose already knows about the interdepartmental discussions which led up to the present difficult situation for the DTI.
13 December 1972
Copy to: M & TD
Desi
A C Stuart
Hong Kong & Indian Ocean Department
Kunhilford
13/12
CONFIDENTIAL