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COMMUNICATIONS AND TRANSPORT
re-export trade. The United States remained the major market for Hong Kong's exports sent by air accounting for more than 40 per cent of products and, for imports air-freighted into Hong Kong, Japan took the lead with nearly 25 per cent of the total.
The move by airlines towards wide-bodied aircraft to cope with the growing passenger traffic continued; at the end of 1979 about half of the services in and out of Hong Kong were wide-bodied aircraft capable of carrying 300 or more passengers.
Aircraft movements for the year increased by about six per cent from 52,642 to 55,928. Two more American airlines introduced scheduled services to Hong Kong in the second half of the year. In November, the governments of the United Kingdom and the People's Republic of China officially signed a bilateral air services agreement setting out, inter alia, the pattern for the future development of direct air links between the United Kingdom, Hong Kong and major cities in China.
In 1979, British Airways was the sole operator of scheduled services between Hong Kong and London. However, in November, the Air Transport Licensing Authority granted licences to Cathay Pacific Airways and British Caledonian Airways to operate additional scheduled services on the Hong Kong to London route from April, 1980. Laker Airways, which also applied to operate some of the additional scheduled services, was not granted a licence. In arriving at its decision, the authority took into account comprehensive sub- missions made by the three airlines, the Hong Kong Government, and other parties at a public hearing.
The Air Transport Licensing Authority is an independent statutory body established under the Air Transport (Licensing of Air Services) Regulations. Under these regulations, the power is vested with the authority to grant or to refuse applications from airlines, registered in the United Kingdom and its dependent territories, to operate scheduled air services in and out of Hong Kong.
In 1979, the Licensing Authority also granted a licence valid for five years to Royal Brunei Airlines to operate scheduled services between Hong Kong and Brunei.
During 1979, a total of 32 airlines were operating more than 950 scheduled passenger and cargo services each week between Hong Kong and the United Kingdom, the People's Republic of China, North and South America, Europe, East and South Africa, the Middle East, Australasia, the South Pacific region, and Asian countries. In addition, some 20 airlines operated about 50 non-scheduled services a week.
A most welcome sign during the year was the gradual introduction of budget fares by a number of airlines. Typical examples were the implementation of cheap, advance purchase, excursion tour fares between Hong Kong and Australia and the 'round-the-world in 80 days' cut-fare tickets.
One big setback in the development of air travel in 1979 was the shortage of jet fuel and its increasing cost. Many airlines were forced to halt or cut down on the number of flights on their less lucrative routes and all major airlines had to push up standard fares and cargo rates to balance their books. Hong Kong was not hard hit by the fuel shortage but, in general, travellers had to pay more for their air trips abroad in the second half of the year.
Hong Kong International Airport, Kai Tak, like most large international airports, has been undergoing a long-term development programme to extend its facilities to cope with demand. The current phase of development, which is the last in a four-stage extension programme, was proceeding during 1979 and is scheduled for completion in 1982.
In the passenger terminal, extensive renovation was being carried out to bring the facilities at both the departure and arrival levels of the older half of the building up to the standard of