GRS 450
FIDENTIAL
DESKEY 19010OZ (PEKING)
FM FCO 18180OZ JUNE 79
TO IMMEDIATE PEKING
CONFIDENTIAL
HEE 184/2
RECEIVED IN RAGDERY NO. 51
2 1 JUN 1979
TELEGRAM NUMBER 360 OF 18 JUNE
IN:
INFO TO IMMEDIATE HONG KONG
181
PA
RA
183
YOUR TEL NO 565: UK/PRC AIR SERVICES NEGOTIATIONS 184
1. IT WAS IMPOSSIBLE TO SATISFY BOTH THE BA AND THE HONG KONG DEMANDS WHILST RETAINING OUR CLEAR PREFERENCE FOR OPTION A,
THEREFORE WHAT WAS DECIDED WAS ESSENTIALLY A COMPROMISE AND HAS
TO BE SEEN IN THAT LIGHT, FOUR YEARS IS A LONG TIME IN CIVIL
AVIATION AND BA WILL HAVE THE BENEFITS OF OPERATING THE ROUTE FOR MOST OF THAT TIME WITH LIMITED RIGHTS. IF AT THE END OF THAT TIME THEY HAVE TO COME OFF THE HONG KONG ROUTING TO PEKING
THEY WILL THEN HAVE TO SELECT THE MORE DIRECT ROUTING THAT GIVES
THEM THE BEST COMBINATIONS, DELHI-PEKING SHOULD OFFER REASONABLE POTENTIAL.
2. WE TAKE YOUR POINT ABOUT THE DIFFICULTIES POSED FOR BA IF THE CAPACITY RESTRICTION WERE TO BE OPERATING AFTER THEY HAD GIVEN UP THE HONG KONG ROUTING BUT EITHER THE FORMULA PROPOSED IN YOUR PARA 8 OR, IF THAT PROVES DIFFICULT TO OBTAIN, THE ALTERNATIVE OF THE CAPACITY RESTRICTION CEASING WHEN BA CEASES TO OPERATE VIA HONG KONG, WHICH IS LOGICALLY MORE DEFENSIBLE, SHOULD TAKE CARE OF THAT.
3. WE DO NOT WANT A STATED DATE OF DA'S WITHDRAWAL FROM
HONG KONG-PEKING TO BE DISCUSSED WITH THE CHINESE AND CERTAINLY NOT TO APPEAR IN ANY PAPER-WORK. THERE IS THEREFORE NO NEW CARD TO PLAY (YOUR PARA 6).
4. YOUR PARA 10 INDICATES THAT YOU CLEARLY ENTERTAIN
HOPES OF BA RETAINING THE HONG KONG ROUTING AFTER THEY GIVE UP THE HONG KONG-PEKING RIGHTS AND WHEN A HONG KONG BASED CARRIER COMES ON THE SECTOR. CERTAINLY WE WOULD WANT YOU TO TRY FOR THIS ALTERNATIVE IF YOU CONSIDER IT TO BE A REALISTIC OPTION. IF
IT IS SECURED THEN WE WOULD THEN BE ABLE TO IMPLEMENT THE FIRST POSSIBILITY MENTIONED IN PARA 2 OF OUR TEL 365, NAMELY BA GIVING UP HONG KONG-PEKING RIGHTS AFTER 3 YEARS BUT RETAINING THE HONG KONG ROUTING WHILST A HONG KONG BASED CARRIER COMES ON TO THE ROUTE WITH FULL RIGHTS.
CONFIDENTIAL
15.