GR 400
CONFIDENTIAL
FM MANILA 150215Z FEB 79
TO PRIORITY FCO
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Heck 184/!
138
PÅ
TELEGRAM NUMBER 079 OF 15 FEBRUARY
INFO HONG KONG (FOR GOVERNOR AND BCARFE) AND BANGKOK (FOR ROGERS).
FOLLOWING FROM BRYANT,
AIR SERVICE DISCUSSIONS UK AND PHILIPPINES.
1. THESE DISCUSSIONS TOOK PLACE IN MANILA FROM 12 TO 14 FEBRUARY. THE
TALKS WERE REQUESTED BY THE PHILIPPINES, WHO WISH TO INTRODUCE
SERVICES ON THE TRUNK ROUTE BETWEEN MANILA AND LONDON. THE
OPPORTUNITY WAS TAKEN ALSO TO REVIEW THE REGIONAL SERVICES
BETWEEN HONG KONG AND MANILA. MIFT CONTAINS THE TEXT OF THE AGREED MINUTE OF THE TALKS (WITHOUT ANNEX).
2. THE PHILIPPINE OBJECTIVE WAS TO REACH AGREEMENT ON TRUNK ROUTE
SERVICES AT THESE TALKS. THEIR REASONS WERE A DESIRE TO SWITCH FROM AMSTERDAM TO LONDON LATER IN 1979 AS THE TERMINATING POINT
OF THEIR EUROPEAN SERVICE AND THE NEED TO ENSURE FULL UTILISATION
OF THEIR DC10S AFTER DELIVERY OF B747S FROM NEXT JANUARY. THEY WERE ALSO SENSITIVE TO PUBLIC OPINION, BECAUSE TWO RECENT ROUNDS
OF DISCUSSIONS WITH USA AND AUSTRALIA HAD PROVED NEGATIVE. THEY
WERE DISAPPOINTED WHEN WE SAID THAT THERE WERE A NUMBER OF
TEMPORARY UNCERTAINTIES WHICH PRECLUDED US FROM REACHING FINAL AGREEMENT AT THIS STAGE. THESE INCLUDED ICAP, WHICH INFLUENCED
BA'S ROUTE PATTERN IN SOUTH EAST ASIA AND THE FAR EAST: AND THE
FACT THAT WE NEEDED TO OBTAIN MANILA AS A BEYOND-POINT FROM SINGAPORE
AND MALAYSIA SO THAT BA COULD EXTEND SERVICES TO THESE POINTS
TO MANILA. WE ALSO POINTED OUT THE UNCERTAINTY CONCERNING PHILIPPINE SERVICES TO SAUDI ARABIA, WHICH ARE TO BE THE SUBJECT OF TALKS SOON. THE PHILIPPINES MIGHT NOT BE ABLE TO SECURE TRAFFIC RIGHTS FROM THE SAUDIS TO THE UK, WHICH COULD AFFECT THEIR ROUTEING PLANS.
WE ASSURED THE PHILIPPINE DELEGATION THAT WE WERE SYMPATHETIC
TOWARDS THEIR PROPOSAL FOR TRUNK ROUTE SERVICES AND SUGGESTED.
THAT A FURTHER ROUND OF TALKS SHOULD BE HELD IN A FEW MONTHS
BY WHICH TIME WE HOPED THE UNCERTAINTIES WOULD BE REMOVED, THEY
ACCEPTED THIS WITH GOOD GRACE.
3. IN DETAILED DISCUSSION OF THE TRUNK ROUTE WE SAID THAT WE THOUGHT IN TERMS OF A THIRD/FOURTH FREEDOM EXCHANGE, WHICH WOULD PERMIT A COMBINATION OF THIRD/FOURTH TRAFFIC ALONG THE ROUTE. IN CONTRAST, THE PHILIPPINES WANTED FIFTH FREEDOM RIGHTS ALL ALONG
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