GR 1,200 PRIORITY
CYPHER CAT 'A'
FM FCO 271855Z
CONFIDENTIA
See (391
AND BY BAG
HKR 184/1
2 LAIN 1978
UN
71
370
می شد
PA
2: Taken
CONFIDENTIAL
No
TO PRIORITY CANBERRA TELNO 330 OF 27 JUN INFO PRIORITY WELLINGTON, HONGKONG (BCARFE AND GOVERNOR) SINGAPORE, KUALA LUMPUR, JAKARTA, BANGKOK, MANILA, BAHRAIN, WASHINGTON, OTTAWA, PARIS, BONN, ROME, THE HAGUE. INFO SAVING VIENNA, BELGRADE, JOHANNESBURG, ATHENS.
200
OUR TELSNO 302 AND 325: UK/AUSTRALIA AIR SERVICES.
DELHI,
1. TALKS WITH AUSTRALIAN OFFICIALS ENDED IN LONDON ON 23 JUNE. FROM THE BILATERAL AIR SERVICES STAND POINT, THE AUSTRALIAN PROPOSALS ARE ATTRACTIVE. THEY WOULD ACHIEVE THE OBJECTIVE OF BOTH COUNTRIES TO INTRODUCE LOWER AIR FARES. THE LOWER FARES WOULD GEN- ERATE A SUBSTANTIAL NUMBER OF ADDITIONAL PASSENGERS. RESTRICTION OF THE THROUGH CARRIAGE TO BA AND QANTAS WOULD PERMIT MORE EFFICIENT UTILISATION OF AIRCRAFT. BA ARE SATISFIED THAT THEIR EARNINGS KOULD INCREASE APPRECIABLY.
2. THE AUSTRALIANS AGREED TO ACCOMMODATE US ON CERTAIN SPECIFIC ISSUES: TICKETS AT THE LOWER FARE WOULD BE AVAILABLE ON AN INDIVIDUAL INSTEAD OF A CHARTER BASIS: DA COULD CONTINUE TO PICK UP FREIGHT IN INDIA FOR THE UK ON RETURN FLIGHTS FROM AUSTRALIA. OTHER SPECIFIC ISSUES TO BE DISCUSSED FURTHER ARE: THE NUMBER OF TRAFFIC STOPS PER FLIGHT PERMITTED IN AUSTRALIA, WHICH BA INSIST SHOULD BE MORE THAN THE SINGLE POINT PROPOSED BY THE AUSTRALIANS: REVENUE POOLING BETWEEN BA AND QANTAS: THE IMPLICATIONS OF A THIRD/FOURTH FREEDOM REGIME FOR POSSIBLE FUTURE CONCORDE OPERATIONS TO AUSTRALIA: THE POSSIBLE NEED TO ACCOMODATE END TO END SERVICES BETWEEN UK AND NEW ZEALAND VIA AUSTRALIA WITHIN THE PROPOSED REGIME, WHICH THE AUSTRALIANS ARE NOT VERY KEEN ON, BECAUSE IT GOES AGAINST THE CONCEPT OF THEIR PROPOSALS.
3. WE WERE IN TOUCH WITH LAKER AIRWAYS ALL THROUGH THE TALKS AND THEY SUBMITTED MODIFIED PROPOSALS. THE AUSTRALIANS CONTINUED THEIR OPPOSITION TO THE INTRODUCTION OF CHARTER SERVICES, ON THE BASIS THAT THESE WOULD CREAM OFF THE LOW FARE TRAFFIC FROM THE TWO MAIN CENTRES OF SYDNEY AND MELBOURNE.
4. HONG KONG GOVERNMENT AND CPA WERE INVITED TO JOIN IN TOWARDS THE END OF THE NEGOTIATIONS. THEIR PRELIMINARY VIEWS WERE AS FOLLOWS. HONG KONG'S LOSS OF TOURIST INCOME FROM STOPOVERS EN ROUTE LONDON-AUSTRALIA WOULD NOT BE SIGNIFICANT AND ANY SUCH LOSS WOULD BE MORE THAN OFFSET BY THE INCREASE OF TOURIST REVENUE FLOWING FROM CHEAPER FARES, WHICH BOTH THE HONG KONG GOVERNMENT AND CPA WERE MUCH IN FAVOUR OF. THE EAST AUSTRALIA-HONG KONG ROUTE WOULD NOT BE MUCH AFFECTED BY THE PROPOSALS THOUGH THERE COULD BE PROBLEMS OVER REDUCED FREQUENCY. CPA THOUGHT THAT THE AUSTRALIAN PROPOSALS MIGHT MAKE THEIR WEST AUSTRALIA SERVICE UNVIABLE. THEIR PRINCIPAL CONCERN, HOWEVER, WAS THE RISK OF OTHER COUNTRIES FOLLOWING THE AUSTRALIAN PŘECENDENT AND WITHDRAWING FIFTH FREEDOM RIGHTS. THIS COULD AFFECT CPA VERY SEVERELY BECAUSE ONE THIRD OF THEIR REVENUE COMES FROM FIFTH FREEDOM TRAFFIC. THE HONG KONG GOVERNMENT AND CPA ARE NOW TO EXAMINE THE IMPLICATIONS OF THE PROPOSALS IN GREATER DEPTH.
15. THE AUSTRALIANS
CONFIDENTIAL IDEN
AL