TNAG-0643-FCO40-791-Involvement-of-Hong-Kong-in-air-services-agreements-1977 — Page 40

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TO PRIORITY HONG KONG TELEGRAM NO 968 OF 16 DECEMBER 1977. INFO HONG KONG (BCARFE) AND BERNE.

UK/SWITZERLAND, AIR SERVICES AGREEMENT.

1. YOU WERE ABLE TO HELP US WITH SOME FIGURES ON SWISSAR’S HONG KONG SERVICES (LATHAM'S LETTER OF 14 SEPTEMBER ) WHICH WE NEEDED FOR OUR EX-POST FACTO REVIEW OF THE UK/SWITZERLAND AIR SERVICES AGREEMENT AND, IN PARTICULAR, VERIFY SWISSAIR'S

PPARENTLY VERY LOW LOAD FACTORS ON SWITZERLAND-HONG KONG SERVICES. THESE, COMBINED WITH THE SEVERE IMBALANCE OF EARNINGS (UK 16 MILLION POUNDS, SWITZERLAND 32 MILLION POUNDS TO MARCH 1977) CONFIRM THE EXPECTED NEED FOR A REVIEW JOINTLY WITH THE SWISS. WE HAVE INVITED THE SWISS TO TALKS ON THESE ISSUES AND HOPE TO HOLD THEM IN LONDON IN FEBRUARY. WE SHOULD BE GLAD TO WELCOME A REPRESENTATIVE OF THE HONG KONG GOVERNMENT TO THE TALKS AND PRIOR BRIEFING MEETINGS.

2. WE HOPE TO EFFECT THROUGH THESE DISCUSSIONS A SUBSTANTIAL IMPROVEMENT IN THE BALANCE OF THE BILATERAL FOLLOWING THE SUCCESSFUL OUTCOME OF OUR TALKS WITH THE FRG, YOU WILL RECALL (BONN TELEGRAM NO 902 NOT TO BERNE) THE CONCERN OF THE FRG AUTHORITIES THAT SWISS SIXTH-FREEDOMING ACTIVITIES SHOULD NOT

BE OVERLOOKED.

OWEN

MAED WED HKGD

FILES

MR.BURROWS

MR.SUTHERLAND

MR.MURRAY

[COPIES SENT TO CAD/DOT]

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