CONFIDENTIAL
LORD GORONWY-ROBERTS'S VISIT TO HONG KONG:
11-17 JANUARY
BRIEF NO. 16: AIR SERVICES
1.
Two British airlines serve Hong Kong, British Airways and the Hong Kong based Cathay Pacific Airways (CPA). British Airways serve Hong Kong on their trunk routes from the UK to Australia and Japan;
CPA run regional services to East and South-East Asia
and Australia.
2. The United Kingdom controls the grant of traffic rights at Hong Kong. These enable foreign airlines to route their scheduled services through Hong Kong in exchange for rights for British airlines. In negotiations for traffic rights, the main interest of the Hong Kong Government has been to support CPA so far as regional air services are concerned; further afield they have favoured an "open skies" policy in order to encourage trade and tourism. United Kingdom policy in such negotiations is to obtain the best possible result for both British airlines.
3. The Hong Kong Government have from time to time argued that they alone should dispose of Hong Kong traffic rights. There can be no question of accepting this viewpoint since the control of international air traffic comes under the heading of external relations, fo hich the UK Government remains responsible. practice the UK negotiators work very closely with Hong Kong representatives whose views are given full weight.
In
44.
The view has sometimes been expressed in Hong Kong that traffic rights should be traded against other benefits for Hong Kong. This has always been against UK policy. In the prevailing economic conditions it is more than ever necessary that we should be free to exact full value in our bilateral deals for the benefit of British airlines, including CPA.
5.
Recent negotiations in which the interests of British Airways and Cathay Pacific Airways have interlinked have been those with
/Australia,
Y