CONFINERNA A
TO THE EXTENT THAT THEY ARE RUNNERS, WOULD PREFER TO TAKE T RISK OF POSTPONING AN AGREEMENT ON THE REGION RATHER THAN HAVING A DISADVANTAGEOUS AGREEMENT NOW.
•
3. EVEN IF THE PEKING ASSESSMENT THAT TIME WEAKENS OUR POSIT N TURKS OUT TO BE CORRECT, ALL THAT WOULD BE AT RISK IN TERMS REGIONAL SERVICES WOULD BE A RATHER MODEST ARRANGEMENT LINKING HONG KONG AND SHANGHAI, IF OUR VIEW IS CORRECT, THE GAINS COULD BE CONSIDERABLE. SO ON BALANCE, WE PREFER TO CONSIDERR OPTIONS A,
B AND C FROM THE POINT OF VIEW THAT IT WOULD BE ADVANTAGEOUS TO DELAY AGREEMENT ON THE REGIONAL ROUTES.
4. THE ADVANTAGES OF OPTION A, AS FAR AS WE ARE CONCERNED, ARE THAT IT PROVIDES FOR IMMEDIATE SERVICES FROM HONG KONG TO POINTS JR CHINA, AS WELL AS PROVIDING FOR THE SCRVICES, THIS WILL
IT STRENGTHEN HONG KONG'S POSITION AS A GATEWAY INTO CHINA. GOTS TOWARDS PROVIDING THE RIGHTS FOR B.A BETWEEN HONG KONG AND PEKING, RIGHTS WHICH B.A CONSIDER NECESSARY TO MAKE THE SERVICE VIABLE. THEN, IT AT LEAST PROVIDES FOR A HONG KONG BASED BRITIS CARRIER TO SERVE SHANGHAI AND IN DUE COURSE PEKING, AND THERE IS A PROVISION FOR A REVIEW AT WHICH WE CAN ATTEMPT TO CORRECT THE IMBALANCE.
5. THE OBVIOUS DISADVANTAGE OF OPTION A IS THE SERIOUS IMBALANCE
THIS IN RESPECT OF POINTS AND CAPACITY ON THE REGIONAL ROUTES. IMBALANCE WILL BE AN AWKWARD PRECEDENCE IN THE CONTEXT OF THE REVIEW THE TERMS AND SCOPE OF WHICH THE CHINESE HAVE NOT (R) NOT AGREED. WE HAVE NO INDICATION ON WHEN A HONG KONG BASED DRITISH CARRIER WOULD BE ABLE TO FLY TO PEKING, NOR WHAT THE FREQUENCY AND CAPACITY LIMITATIONS MIGHT BE. EVEN ON THE SHANGHAI SERVICE, THE FREQUENCY-LIMITATION ON THE HONG KONG BASED CARRIER COULD WELL REDUCE PROFITABILITY TO THE POINT OF MAKING THE SERVICE UNVIABLE. IN HONG KONG, THERE MAY WELL BE CRITICISM THAT TRAFFIC ORIGINATING IN HONG KONG MUST USE ESSENTIALLY CHINESE TRANSPORT
THIS CRITICISM FOR CONNECTION WITH THE INTERIOR CITIES OF CHINA. WILL BE HEIGHTENED IF THE EXTENSION OF THE CABOTAGE SERVICE FROM HONG KONG TO PEKING RESULTS IN A DETERIORATION OF SOME SERVICES BETWEEN HONG KONG AND LONDON. FINALLY, AS IT IS GENERALLY KNOWN
THAT B.A HAD SECURED OWN STOP-OVER RIGHTS UNDER THE. 1973 AGREEMENT, IT WOULD BE DIFFICULT TO EXPLAIN WHY SUCH UNBALANCED REGIONAL SERVICES HAD BEEN CONCEDED WHEN NOTHING ADDITIONAL HAD BEEN OBTAINED ON THE BRITISH SIDE. THE INFERENCE WOULD BE DRAWN THAT THE CONCESSIORS ON THE REGIONAL ROUTES TO THE CHINESE MUST BE RELATED TO AN ACCEPTANCE BY H.M.G OF THE CHINESE VIEW OF THE STATUS
OF HONG KONG.
2 CONFIDEN, HAL
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