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MDLOAN 5188

4. YOU ASKED WHAT FURTHER STEPS BA MIGHT TAKE BETWEEN NOW AND

THE INTENDED MEETING WITH AMBASSADOR MA TO SIGNAL THAT THEY WERE PROCEEDING WITH THEIR PLANS UNDEFLECTED BY THE OUTCOME OF THE LAST ROUND OF CONSULTATIONS. IT WOULD BE PREMATURE TO ADVERTISE THE SERVICE OR SELL TICKETS, AND OTHER ESSENTIAL STEPS SUCH AS APPOINTING HANDLING AGENTS IN TAIPEI OR SEEKING AN OPERATING PERMIT, ARE NOT PUBLIC MATTERS. IT COULD HELP PREPARE THE GROUND BEFORE MA IS FORMALLY GIVEN THE MESSAGE IF HEAD OF FED WERE TO DROP HINTS ABOUT THE LIKELY OUTCOME TO COUNSELLOR YUAN (WHO WILL NEED TO BE SUMMONED ON OTHER TAIWAN BUSINESS SHORTLY). THE CHINESE WOULD THEN HAVE LESS EXCUSE TO COMPLAIN ABOUT SHOCKS AND UNILATERAL ACTION, AND WOULD BE LESS DISPOSED, TO THINK THAT WE WERE PREPARING FOR A FOURTH ROUND OF TALKS.

5. THE TIMESCALE IDEALLY WOULD THEN RUN AS FOLLOWS:

MID SEPTEMBER

INFORM AMBASSADOR MA (WE AGREE WITH THE REVISED SEQUENCE OF

POINTS SUGGESTED IN PARA 1 OF YOUR TUR).

MID TO LATE SEPTEMBER

ANY FOLLOW UP ON PRESS NOTICE WITH CHINESE (WE SUGGEST ANY REDRAFTING IS BEST DONE BETWEEN YOU AND MFA RATHER THAN TRYING TO RESOLVE THROUGH CHINESE EMBASSY HERE)

END SEPTEMBER

BA PUBLICISE SERVICE, START TO SELL TICKETS (BA ADVISE THAT THEY COULD POSTPONE THIS STEP UNTIL MID OCTOBER IF NECESSARY BUT WOULD PREFER NOT TO. EVA HAVE BEEN RELATIVELY SELF-CONTROLLED OF LATE IN ADVISING THE MEDIA OF PROGRESS ON THIS ISSUE, BUT WE COULD NOT EXPECT THEM TO HOLD OFF ADVERTISING AND SELLING BEYOND END SEPTEMBER.)

BA AND EVA APPLY TO TAIPEI AUTHORITIES AND DOT RESPECTIVELY FOR

OPERATING PERMITS.

SIR COLIN MARSHALL VISITS PEKING (WE ARE TELEGRAPHING SEPARATELY

ABOUT THIS NOT TO ALL)

EARLY/MID OCTOBER

TRY TO FINALISE PRESS STATEMENT WITH THE CHINESE (AND KEEP TRYING UP UNTIL LAST MOMENT)

MID OCTOBER

ISSUE OF PERMITS TO BA AND EVA CEVA'S PERMIT TO BE CONDITIONAL SO FAR AS POSSIBLE ON BA HAVING A PERMIT AND OPERATING SERVICES

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