See
CONFIDENTIAL”
SAVING darīja
TOP COPY
816/2
2 2 MAR 1979
PA
SAVING J13 OF 21/3/19
BY BAG
CONFIDENTIAL
FM FCO
INDEX"
то
HONG KONG
TEL NO
AND TO SANG PEKİNG
YOUR TEL NOS 357, 359 AND 387: AIR SERVICES TO CHINA
1. While we are seeking a solution which seems unlikely to provoke the Taiwanese
we naturally cannot be certain that we shall succeed. Nonetheless, we have now reached the point where possible benefits both to UK and to Hong Kong from an ASA are sufficient to justify our taking the risks in going forward with the establishment of normal relations.
2. We think it unlikely that there would be any unfavourable reaction from Taiwan. If there were, we would of course do what we could to help CPA, in the light of circumstances prevailing at the time. There is, for example, scope for new business in the establishment of services to the USA across the Pacific, with the exercise of fifth freedom rights beyond Japan. The fact that CPA (and we) have hitherto been reluctant to add still further to their imbalance of fifth freedom earnings with Japan has inhibited CPA from making use of the opportunities under Bermuda 2. In the unlikely event that the establishment of normal air service relations with the PRC led to an interruption of CPA's fifth freedon earnings between Taiwan and Japan, this inhibition would be removed and there would be scope for negotiation with Japan. Much the same would apply to pursuing rights for a CPA service to Canada via Tokyo as referred to in your letter of 7 March to Hong Kong and General Department, FCO. But there could be no (no) question of "compensation".
3. As regards your first TUR we consider it very important not to undermine our negotiating position, in the negotiations which we are now confidently expecting will take place within the next few weeks, by agreeing to CAAC flights between Hong Kong and Hangzhou
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CONFIDENTIAL
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