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the status quo or something very much like it.
Although
HMG would still wish to establish a better understanding
than we have at present as to the proper share of services
on the routes between Hong Kong and China, the Chinese
might seek a monopoly of such services. We should resist
this but some realistic accommodation may be necessary.
Hong Kong as a Special Administrative Region (SAR) of China
12. If Hong Kong became an SAR it would still be
necessary for HMG to retain responsibility for the conduct
of external relations. If this was not done, the results
would be highly damaging for UK-based and Hong Kong-based
airlines:-
?
(i) CPA's position as a Hong Kong-based airline
would be totally dependent on whether the Chinese Government was prepared to
designate them for services to and from
Hong Kong and to negotiate rights for
(ii)
them with foreign governments. The Chinese government might wish to have
these services operated in large measure
by their own airline instead, and if
they were prepared to designate CPA to operate any of them, they would no doubt demand a financial quid pro quo;
UK-based airlines would be entitled to about
half the services between London and Hong Kong (say 10 out of 20 instead of British Airways and British Caledonian's 13 now).
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