We have warned the Hong Kong Government of our intention to open talks with the Swiss, but I should be glad of your general comments. We should not necessarily aim to cut down the frequency of Swissair's services to Hong Kong but we should certainly aim for some kind of arrangement which would give the United Kingdom a better share of revenues under the Agreement. Since there are very few additional rights which we require from the Swiss, this will inevitably mean extracting a certain amount of hard cash from the Swiss and they can be expected to dislike the prospect intensely.

For your information, Patrick Shovelton has already hinted to Dr Guldimann, the Swiss Director General of Civil Aviation, that we have it mind to request talks about the workings of the ASA.

Yours sincerely

anden

L F STANDEN)

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