ASEAN have expressed concern to the Australians at the possible harmful effects in ASEAN countries if stopovers

are not permitted and the hope that the Australian Government would give careful consideration to ASEAN

interests. Opponents of the scheme will also criticise

it as being protectionist and a cartel between the

two national airlines. There is also a risk that the

ASEAN countries and India will over-react to the

immediately evident disadvantages of the scheme for them,

and be sceptical of the benefits, particularly of the

Australian contention that there will be an increase

in longer-stay tourists to make up, the loss from stop-over tourists. It will be up to the Australians

to convince the countries concerned that Australian

tourists will fill the gap; there is no likelihood of British tourists in any number taking their holidays in

SE Asia.

(c) Europe

The Australians intend to negotiate the same kind of agreement with some European countries as with us (probably Yugoslavia, Greece, Italy and FRG and possibly Netherlands), ie restricted to an exchange of end-to-end rights. Frequency of services would have to be reduced probably by up to 50% depending on the route. others (probably France and Austria and possibly

Netherlands), if end-to-end traffic is not enough to

justify a service, they will terminate their agreements.

With

They believe that European opposition will not be strong

enough to black

scheme.

i

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