HKDAED (3)
CONFIDENTIAL
and the British Council).
5. We understand that Sir Y K Pao may be thinking of funding a library in Britain and naming it after Deng Xiaoping. He might find it useful to approach Sir Mark Richmond, Chairman of the Committee
of Vice Chancellors and Principals, who is aware of the proposal and
can advise on which institution might most appropriately receive the
new library.
E.
DRAGONAIR
6. Dragonair is a British airline incorporated in Hong Kong in September 1984. Sir Y K and companies under his control hold about 35% of total shareholding. Following its designation under the UK-Thailand ASA of October 1986, Dragonair now serves Thailand on regular basis and operates non scheduled services to several other regional destinations. Dragonair has ambitions to expand both its
scheduled and non-scheduled services.
7. We hope to resume governmental talks with Chinese soon on scheduled services to the PRC, but dates not yet agreed. One of our objectives is to secure rights for Dragonair to operate scheduled services to 5 points on the Chinese mainland other than Peking and Shanghai (already served by Cathay Pacific). The Air Transport Licensing Authority in Hong Kong recently granted licences for Dragonair to serve Peking and Shanghai. It is for HKG to decide whether they wish HMG to seek traffic rights, in the light of Cathay Pacific's (CPA) existing services to these points. HKG policy is
generally only one carrier per point.
F.
SINO-BRITISH FRIENDSHIP SCHOLARSHIP SCHEME
8.
Under the Memorandum establishing the Scheme (signed by the Secretary of State, Sir Y K Pao and Vice Premier Li Peng on 9 June 1986) China and the Sir Y K Pao Foundation will pay £1.4m per year. and Britain (ODA) will pay £700,000. The Scheme will pay for up to
420 PhD and research level awards each year for ten years. The first students arrived in Britain in September. The Minister for Overseas Development gave a reception for 20 of the students, which