TNAG-0643-FCO40-791-Involvement-of-Hong-Kong-in-air-services-agreements-1977 — Page 145

CONFIDENTIAL

f.i.

Mr. Maland fin

mýd

NOTE FOR THE RECORD

( Paras 5-9 are

require Marught.)

illuminating

(xi.

MEETING WITH SIR MURRAY MACLEHOSE, (GOVERNOR OF HONG KONG) IN HONG KONG ON 3 NOVEMBER 1977

1. I called on Sir Murray MacLehose at Government House on 3 November 1977 for my customary informal discussion with him about the progress of civil aviation matters. Mr David Wong (Deputy Economic Secretary) was with the Governor when I arrived and stayed to take

a note.

Air Services

2. The Governor started by asking how my meeting with Hong Kong officials had gone the previous day. I said that it had, as always, been an extremely useful opportunity for freely exchanging views on the various problems, past and present, which were of joint concern and that it had been conducted in the usual friendly and good- humoured manner. Looking back over the twelve months since the last such meeting, all had agreed that it had been a particularly busy and fruitful period, so far as Hong Kong's air services had been concerned. Notably:-

(a)

(b)

After a long period of turmoil, we had reached a very satisfactory settlement with the Japanese. This seemed to be working well and the present indications were that the present arrangements would be extended without difficulty when the present term expired.

Although our battle with the Americans had not yielded all the results we had hoped for, so far as the metropolitan UK's interests were concerned, we had succeeded in obtaining practically everything Hong Kong had asked for.

(c) We had recently obtained from Malaysia everything that Hong Kong

had been able to think of.

:

(d) Last week, we had settled our long-standing dispute with the Thais on terms which were extremely favourable to Hong Kong.

3. This was not to say that we had no problems left.

As I saw it, the biggest problem affecting Hong Kong was the unsatisfactory state of British Airways' services between London and Hong Kong.

This was a complex issue which was not suceptible to a solution through the bilateral bargaining which was my normal province, although as ve had already seen with New Zealand its solution might well involve bilateral problems. It was hardly realistic to expect much inprove- mont while the air traffic control strike continued and while B.A.'s labour force were sullen as a result of the pay policies, not of the BA management but of the British Government. But the whole cuestion was being very carefully looked into by the Government, the CAA and BA's management itself.

1

CONFIDENTIAL

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