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12 September 1980

R D Clift Esq

INDEX

HK & G Dept FCO

13A

se

21

Dear Dick,

THE POSSIBILITY OF SITING HONG KONG'S REPLACEMENT AIRPORT IN CHINA

I attach a paper summarising the background to indications that the Chinese might be interested in the airport we are planning to replace Kai Tak being sited in China.

2. This possibility was considered recently in Executive Council. The majority view was that we should continue planning for the replacement airport to be sited in Hong Kong. But a small but significant minority view, led by Sir S Y Chung, the Senior Unofficial Member, was in favour of approaching China now on a possible joint venture for an airport located in China but close to the border with Hong Kong.

3. We have summarised the arguments for both points of view in the paper. Because the issues involved are important and opinion within Executive Council is not unanimous, we should be most grateful for your views and those of Timothy George (to whom I am copying this letter) on the arguments and the conclusions.

4.

12.(c)

In particular we would like confirmation that our argument on air services at paragraph 10(b) is a valid interpretation of the requirements of the Chicago con- vention. It seems to us that air traffic rights have to remain with the power under whose sovereignty an airport lies (but there may be exceptions, Mulhouse- Basle and perhaps Geneva). If we are right and China would not be willing to surrender sovereignty over the site of an airport in China, then there is little point in looking at any other sort of agreement with China over air traffic rights. Our reasoning is that if an agree- ment were negotiated, the use of reciprocal rights by British airlines in exchange for rights at the new airport in China would be successfully challenged in terms of the Chicago convention by the other parties who would presumably much prefer the relatively uncompetitive CAAC to take them up.

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