CO537-4847 — Page 20

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III.

Civil Aviation.

A consideration affecting the

resumption of communications with

Communist China' is the extent to which

the Americans will press for the

application of the agreed policy for

air services to satellite countries.

The special importance for Hong Kong of

air services to China is of course

relevant and even if it were decided

to apply the full satellite policy it

might still be possible to open up some

limited reciprocal communications on the

ound that basic services into China: are

vital.

gr

The question of the transfer of

C.N.A.C. and C.A.T.C. assets in Hong

Kong is the subject of separate

correspondence at present resting with

your telegram No. .

Once recognition is accorded it

will probably be unnecessary to secure

any specific guarantees as regards aircraft

which have to make forced or emergency

landings in Chinese territory, it being

presumed, until the contrary appears,

that the Communists will then grant

normal and reasonable facilties.

IV.

Kowloon-Canton Railway.

As you have reported the

>

resumption of through passenger train

services is still prevented by the

Communists. Their attitude may of course

change with recognition.

V.

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