CONFIDENTIAL
FM HONG KONG
TO IMMEDIATE FCO
TELNO 398
OF 060746Z FEBRUARY 91
INFO IMMEDIATE DTP, PEKING
CONFIDENTIAL
HKC181/6
RECEN
20 FEB 1991
4
015274 MDHIAN 2495
DTP FOR IAD
MIPT: VISIT BY LORD BRABAZON TO PEKING: HK/PRC AIR SERVICES
I.
SCHEDULED SERVICES
1. AFTER 5 ROUNDS OF NEGOTIATIONS, A NEW REGIONAL ROUTE PACKAGE COVERING SCHEDULED AIR SERVICES BETWEEN HK AND THE MAINLAND WAS AGREED IN MARCH 1990. UNDER THE NEW ARRANGEMENTS, CAAC IS ABLE TO DESIGNATE UP TO THREE OF THEIR NEWLY FORMED REGIONAL AIRLINES TO OPERATE THE HK/PRC ROUTES CAIR CHINA, CHINA EASTERN, CHINA SOUTHERN HAVE SINCE BEEN SO DESIGNATED). ON THE OTHER HAND, THE UK MAY DESIGNATE TWO HONG KONG-BASED AIRLINES (DRAGONAIR IS NOW THE ONLY DESIGNATED AIRLINE FOLLOWING THE WITHDRAWAL OF CPA FROM THE PEKING AND SHANGHAI ROUTES IN APRIL 1990). SCHEDULED SERVICES ARE OPERATED BY PRC AIRLINES AND DRAGONAIR ON 7 ROUTES: PEKING, SHANGHAI, TIANJIN, DALIAN, HANGZHOU, KUNMING AND XIAMEN. PRC AIRLINES MAY ALSO OPERATE FROM GUANGZHOU AND FIVE OTHER CHINESE CITIES YET TO BE NAMED. IT IS OUR INTENTION TO SEEK TO NEGOTIATE, WHEN OPPORTUNITY PRESENTS ITSELF, A MORE BALANCED REGIONAL ROUTE PACKAGE WHICH GIVE HONG KONG AIRLINE(S) A MORE EQUITABLE SHARE OF MARKET ACCESS AND CAPACITY.
2. DEFENSIVE LINE TO TAKE: PLEASED TO NOTE THAT THE NEW REGIONAL ROUTE ARRANGEMENTS AGREED IN MARCH 1990 HAVE BEEN IMPLEMENTED SMOOTHLY. HOPE THAT THE ARRANGEMENTS WILL BE REVIEWED IN DUE COURSE TO ENSURE THAT THE GROWING MARKET DEMAND AS WELL AS THE INTERESTS OF THE AIRLINES OF BOTH SIDES ARE CATERED FOR.
II. PRC AIRLINES THROUGH-RUNNING HONG KONG
3. AT THE EARLIER STAGE OF THE LATEST SERIES OF REGIONAL ROUTES NEGOTIATIONS, CAAC DEMANDED THE RIGHT TO THROUGH-RUN HONG KONG TO LONDON, AUSTRALIA, NORTH AMERICA, EUROPE AND S.E. ASIA. TO ACCEDE TO SUCH A DEMAND WOULD NOT ONLY DAMAGE HONG KONG'S AVIATION
INTERESTS BUT WOULD ALSO UNDERMINE HONG KONG'S AUTONOMY IN THE FIELD OF CIVIL AVIATION. ALTHOUGH IN THE EVENT THE CHINESE DID NOT PRESS FOR THROUGH-RUNNING BECAUSE THEY WERE ANXIOUS TO
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CONFIDENTIAL