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the actual economic operating gains for BA should be greater than
the losses. BA are in favour of the proposals. Neither they nor
we see the implications for other routes as being of any great
significance. Through being the first Government to be consulted,
we are in a strong negotiating position with the Australians:
this is evident from the concessions which they have made during
the negotiations. Hesitation now could erode that position.
The cons are confined to the political aspect. Singapore and
Malaysia are likely to be upset; the former will be especially so.
There is a risk that Malaysian resentment could further prejudice
our chances of getting agreements to Concorde overflight.
It is
There are
21 On balance, the gains appear to outweigh the disadvantages.
A positive response could not, however, be unqualified. important to avoid as far as possible being the immediate target
for criticism by Singapore and Malaysia: we should emphasise that
it is for the Australians to negotiate with them.
also a number of practical points on which we need assurances.
Subject to the successful outcome of the Australian negotiations
with the South East Asian countries and to satisfactory solution
of the outstanding practical problems, we recommend that we should
indicate our broad agreement to the Australian proposal, on the
lines of the attached draft outline oral statement.
8