CONFIDENTIAL

LORD BELSTEAD'S VISIT TO HONG KONG : 6 TO 10 DECEMBER 1982

BRIEF NO.10: AIR SERVICES

POINTS TO MAKE

1.

[FOR USE WITH OFFICIALS] Fully understand Hong Kong's

concern that developments in air services talks with the Chinese

should not prejudice negotiations on the future. Hong Kong's

point of view taken into account when preparing the UK negotiating position for current talks. We believe that our

aims must be to press for a proper share for British airlines

on regional routes, with Cathay Pacific's interest taken fully

into account.

2.

DOT Ministers are currently considering the question of

BA's exemption from licensing requirements at Hong Kong.

3.

[DEFENSIVE ONLY eg, with Press, Unofficials, Businessmen]

The combination of London and Hong Kong traffic rights in

international air services negotiations produces benefits for both Hong Kong and UK based airlines. Not a case of Hong

Kong's interests being constantly subordinated to UK.

CONFIDENTIAL

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