Dd. 32855 Ed (4200)
NOTHING TO BE WRITTEN IN THIS MARGIN
- 3 CONFIDENTIAL
terms (of not more than, say, 7%) over a period
of 15 years.
4. Hong Kong turned to us to lend a hand in
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providing financial facilities for this project
HMG
partly because have a responsibility to the
International Civil Aviation Organisation (ICAO)
to ensure that Kai Tak is maintained at a standard
capable of meeting the requirements laid down in
ICAO Reginal Plans but more particularly because
it is undoubtedly in our civil aviation interest
to maintain Kai Tak as a first-class airport (in
recognition of which we made an interest free
loan of £3 million in 1959 to finance improvements).
Next to London, Hong Kong is the most valuable
international traffic point remaining within
United Kingdom responsiblity. It is valuable
first because of the revenue (as distinct from
profit) derived by BOAC from the rights it enjoys
on services to and from Hong Kong (estimated gross
at £10.8 million in 1967/68). It is valuable
secondly because of the important concessions in
traffic rights secured for British airlines else-
where in the world in exchange for traffic rights
at Hong Kong granted to airlines of other countries
in air services negotiations; it is difficult to
quantify these with any accuracy, since in the
complex of air services negotiations it is not
always clear what benefits are specifically
attributable to the grant of rights in Hong Kong,
but theoretically the value of rights obtained
elsewhere should equal the value of rights granted to foreign airlines in Hong Kong (the latter, in
CONFIDENTIAL
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