CONFIDENTIAL
Copies sent to: SEAD,
MALAYSIA AND CONCORDE
also Mr Joy, OID
SUMMARY
1.
Mr. Rumbelow, DOT,
(K.h. designate succeeding 17. GM).
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The Malaysian refusal in December 1977 to permit Concorde to overfly their territorial waters was based nominally on technical, but in fact on political, factors. A year later permission was given for a 6-month trial period. (Paragraph 1)
2.
Air services negotiations concluded in October 1977 left Malaysian Ministers and officials disgruntled at British lack of sympathy for their problems and our tough tactics. The timing and manner of our approach over Concorde were thought to imply duplicity and arrogance. Jealousy of Singapore, and hurt feelings, played a part. (Paragraphs 2-5)
3. Britain considered her attitude justified by the large balance of earnings in Malaysia's favour under the Air Services Agreement (around £10 million a year) and Malaysian cheating over Sixth Freedom traffic and heavy rebating of fares. Malaysia countered that Britain might earn more on the London-Kuala Lumpur route if she tried harder. (Paragraph 6)
4.
The Malaysian Airline crash on 4 December 1977 created an unwelcome complication. (Paragraph 7)
5. Specific Malaysian discontents merged with a burning sense that we had taken their goodwill too much for granted, bearing in mind our £2 billion investment, our remittances of £250 million a year and the presence of 15,000 Malaysian students in the
Environmental factors acquired some significance
UK.
/and
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