Mr Clift
HEK 18H16
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RECEIVED IN REGISTRY NO. 51 - 6 JUN 1980
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CONFIDENTIAL!
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12710
Hong Kong and General Department
HONG KONG: CPA AND THE LONDON ROUTE
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On my way back from Manila I called in at Hong Kong, as you know, for a couple of days. The BTC had made a useful programme for me to call on Mr John Brembridge, the Chairman of CPA; I also called at the Secretariat and had a discussion with Mr Jeaffreson and Mr Keep among others, before going on to a luncheon given for me by Mr Keep, at which I met other personal- ities on the civil aviation side.
2. I could not fail to be impressed by the strong emotion aroused by the CAA's decision in favour of BCAL. Mr Brembridge was reasonably calm on the subject, but nevertheless strongly critical and referred to it at one moment as being 'monstrous'. BA told me on a separate occasion that they thought that CPA were not genuinely interested in the route for fear that they would lose money on it, but I must say I detected no sign of this attitude on Mr Brembridge's part. Mr Brembridge made particular play with the point that CPA's traffic rights on the Bahrain Hong Kong sector gave them precisely the flexibility of operation, even with their larger 747s, that the CAA had denied to them and had used as their main argument for awarding the licence to BCAL. I subsequently tried this argument on Mr Draper, the BA Director of Commercial Operations, who replied that it was spurious; CPA has no rights Bahrain - London and most of its passengers between Hong Kong and Bahrain were Koreans and other Asians joining con- struction gangs in the Gulf; much of this traffic would in any case disappear when BA inaugurated their direct flight to Seoul.
Mr Brembridge's other point was that it was very extraordinary and quite unprecedented for the CAA to have pre-empted any action by the Secretary of State for Trade to issue a direction on political grounds (either to switch the licence to the CPA or to divide it between CPA and BCAL) by producing the counter arguments in their report. His final point was that CPA were now concerned that the grass roots reaction in Hong Kong might get out of hand- the airport handling staff were threatening to refuse to service BCAL aircraft. I think this may have been a genuine concern rather than crocodile tears since Swires would not benefit from generalised anti-British feeling (they have too much of a stake in UK/Hong Kong trade.
3. The Hong Kong officials I spoke to were no less vehement.
CONFIDENTIAL
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