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(B) MR NIXON MAY WELL HAVE INTENDED SINCE JUNE TO MAKE AN

ANNOUNCEMENT BEFORE CHRISTMAS. IF WE HAD BEEN CONSULTED SPECIFICALLY

ON THIS IN JUNE IT WOULD CERTAINLY NOT HAVE APPEARED TO US UNREASONABLE. BUT IT WAS NOT UNTIL THE DELAYED DATE OF MR NIXON'S STATEMENT TO THE HOUSE ON 11 OCTOBER IN WHICH HE SAID HE HOPED TO

MAKE AN ANNOUNCEMENT BEFORE CHRISTMAS THAT THIS INTENTION BECAME

PUBLIC. EVEN THEN IT WAS CERTAINLY NOT AN UNREASONABLE HOPE, BUT THE SLOW PROGRESS OF THE AUSTRALIAN DISCUSSIONS SINCE THEN, FOR WHICH WE ARE NOT CRITICISING THEM, DOES NOW MAKE IT VIRTUALLY IMPOSSIBLE FOR US TO CARRY OUT THE NECESSARY FURTHER CONSULTATIONS WHICH WE

CONSIDER NECESSARY BEFORE GIVING A FINAL COMMITMENT TO THE FULL

AUSTRALIAN PROPOSALS.

(C) WE DO NOT SHARE MR NIXON'S OPTIMISM ABOUT THE DEGREE OF COMMITMENT SHOWN BY MALAYSIA, THAILAND AND INDONESIA. RECENT TELEGRAMS HAVE INDICATED:

(1) WHEREAS MALAYSIA MAY NOT BE UPSET BY THE PROPOSALS, THE

AUSTRALIANS CANNOT TAKE THEIR APPROVAL FOR GRANTED

(KL TELNO 485):

(11) THE THAIS, HAVING BEEN QUOTE LECTURED UNQUOTE BY THE

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AUSTRALIANS, HAVE A RELAXED ATTITUDE TO THE ICAP PROPOSALS, BUT WOULD BE PREPARED TO JOIN IN AN ASEAN APPEAL ABOUT FARES AND STOPOVERS (BANGKOK TELNO 455). THIS COULD EFFECTIVELY SLOW DOWN THE INTRODUCTION OF CHEAPER AIR FARES, AND COULD POSSIBLY

LEAD TO OTHER JOINT ASEAN APPEALS. (111) THE INDONESIANS HAVE APPARENTLY ONLY GIVEN QUOTE AGREEMENT IN

PRINCIPLE UNQUOTE TO THE ICAP PROPOSALS WHICH THE AUSTRALIAN EMBASSY IN JAKARTA ADMITS HAS LITTLE MEANING (JAKARTA TELNO 413).

(D) THERE IS STILL SOME RISK THAT SINGAPORE HAS THE ABILITY TO SERIOUSLY IMPEDE, IF NOT BLOCK, THE PROPOSALS BY PLAYING ON ASEAN SOLIDARITY IN THE FACE OF ANGLO/AUSTRALIAN QUOTE ECONOMIC IMPERIALISM UNQUOTE. WE WOULD LIKE TO KNOW AT LEAST HOW THE PROPOSED AUSTRALIA/ASEAN MEETING ON 11 DECEMBER TURNS OUT.

2. WE DO NOT CONSIDER THAT WE HAVE QUOTE SHIFTED OUR GROUND

UNQUOTE. BUT WE DO ON THE OTHER HAND APPRECIATE THE VERY DIFFICULT

POSITION MR NIXON IS IN AND ARE TRYING TO FIND A SOLUTION.

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