MR 184/373/1
Registry
No.
SECURITY CLASSIFICATION
Top Secret,
Secret.
Confidential.
Restricted.
Unclassified.
PRIVACY MARKING
............In Confidence
DRAFT
LETTER
RESTRICTED
Type 1 +
From
To:-
LF Standen Esq CATR
Department of Trade
MR Morland
Telephone No. Ext.
99
Department
MAED
1001
Cc:
WED
UK/SWITZERLAND AIR SERVICES AGREEMENT
I.
HK&GD
proposal to
cut services
Thank you for your letter of 1 December with which
hors you enclosed figures showing the earnings position has
changed. I am struck how the Swiss earnings on the
Hong Kong route have jumped since 1974, particularly as
the following years were not good ones for the airline
industry. The increase must be due only partly to the
increase in capacity following the introduction of wide-
bodied aircraft. Perhaps there were special factors,
such as another carrier coming off the route, which
contributed to the boost in Swiss earnings.
2. Prima facie it appears we are justified in calling for
consultations with a view to redressing the imbalance.
But it is not clear what we may expect to extract from the
Swiss and how successful we are likely to be. We can be
sure that the Swiss will know in detail the outcome of the
negotiations with the West Germans, in particular that
Lufthansa will make no payment to BA in respect of their
Hong Kong earnings, and will strongly resist making any
concessions to us. I think therefore that we should define
our objectives as clearly as possible and tell Berne and
Hong Kong what they are well in advance of any talks.
3.
I understand that Hong Kong did not voice any objection
to talks to George Rogers provided they were kept closely informed and were given the opportunity to attend but I
sure that they would
ssway any
RESTRICTED
صفال
Dd 198067 400M SEK 1/77
I