GR 525
CONFIDENTIAL
DESKBY 232800Z FCO
CONFIDENTIAL
L
FM HONG KONG 210547Z JUL 79
TO IMMEDIATE FOREIGN AND COMMONWEALTH OFFICE
TELNO.1037 OF 21 JULY,
INFO PRIORITY: PEKING,
HKK 154/2
Акк
23 JUL
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PA
See /219
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ROUTINE : HONG KONG GOVT OFFICE LONDON.
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PEKING TELNOS.654 AND 655′: U.K/PRC AIR SERVICES NEGOTIATIONS.
1. WE ARE UNAWARE OF ANY PREVIOUS INSTANCE WHERE H.M.G HAS CONCEDED TO ANOTHER COUNTRY THE RIGHT TO INFLUENCE THE DESIGNATION
OF BRITISH CARRIERS ON PARTICULAR ROUTES. THEREFORE, IN PURELY CIVIL AVIATION TERMS, WE ARE UNABLE TO FORM A JUDGEMENT AS TO WHETHER IT IS A QUOTE RELATIVELY MINOR QUESTION UNQUOTE OR NOT. HOWEVER, WE BELIEVE SUCH A CONCESSION TO BE BAD IN PRINCIPLE.
2. AS TO PARAGRAPH 2 OF PEKING TELNO.655, WE ARE AGAIN UNAWARE THAT IT HAD ALREADY BEEN ACCEPTED UNCONDITIONALLY THAT H.M.G WOULD NOT DESIGNATE ON THE REGIONAL ROUTES AN AIRLINE WHICH ITSELF OPERATES BETWEEN LONDON AND HONG KONG. WE INDICATED IN OUR TELNO.936 THAT THIS WOULD BE ACCEPTABLE QUOTE ONLY IF THE WORDING WOULD CLEARLY NOT REPEAT NOT PRECLUDE A WHOLLY OWNED SUBSIDIARY OF A HONG KONG BASED BRITISH AIRLINE FROM OPERATINGG ON
THE REGIONAL ROUTES, SHOULD THAT AIRLINE OPERATE TO LONDON UNQUOTE
1734)
3. AS WE HAVE POINTED OUT IN PARA.2 OF OUR TELNO.791, THE CRUX OF THE MATTER RESTS UPON AN ASSESSMENT AS TO WHETHER OUR BARGAINING POSITION ON REGIONAL ROUTES WILL IMPROVE OR DETERIORIATE WITH THE PASSAGE OF TIME. WE REMAIN OF THE VIEW THAT A BETTER REGIONAL DEAL COULD BE OBTAINED IF THE MATTER WERE TO BE LEFT ASIDE TILL LATER. THE STATEMENTS ATTRIBUTED TO LU IN PARA.3 OF PEKING TELNO.626 THAT A SERVICE TO LONDON WILL NOW BE A COMMERCIAL EMBARRASSMENT TO CAAC
AND THAT H.M.G WERE THE DEMANDEURS ON THE TRUNK ROUTE LENDS WEIGHT TO OUR VIEW THAT IN THE CONTEXT OF AN OVERALL AGREEMENT THE CHINESE ARE LESS LIKELY TO CONCEDE ADVANTAGES ON REGIONAL ROUTES THAN IN SUBSEQUENT NEGOTIATIONS DEALING WITH THE REGION ALONE WHERE THE
CHINESE APPEAR TO HAVE A STRONGER INTEREST.
CONFIDENTIAL
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