TNAG-0778-FCO40-982-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 223

END-TO-END CHARTER SERVICES FROM WHICH THE CARRIERS OF THIRD COUNTRIES WOULD BE EXCLUDED,

THERE ARE ALSO SOME MINOR VARIATIONS ON THE ABOVE POSSIBILITIES.

6. ROWLAND SAID THAT ALTERNATIVE (B) ABOVE WAS EFFECTIVELY RULED

OUT BY THE REQUIREMENT IN THE TERMS OF REFERENCE TO MAINTAIN QUOTE A COMMERCIAL VIABLE OPERATION BY AN AUSTRALIAN FLAG CARRIER OR

CARRIERS UNQUOTE AND BY EMPLOYMENT CONSIDERATIONS. THE MAIN ALTERNATIVES WERE THEREFORE EITHER (A) OR SOME VERSION OF (C)

OR (D).

7. IN SUPPORT OF THIS REVIEW THE AUSTRALIA BUREAU OF TRANSPORT ECONOMICS HAS CARRIED OUT A NUMBER OF STUDIES INCLUDING AN EXTREMELY INTERESTING SURVEY OF THE ATTITUDES OF INTERNATIONAL TRAVELLERS WHICH IS DESIGNED TO DISCOVER THE VALUE TO PASSENGERS OF FACILITIES SUCH AS A STOPOVER. WHILE THE REPORT TO MR NIXON WILL NOT BE PUBLISHED, THE STUDIES BY THE BUREAU OF TRANSPORT ECONOMICS WILLo

3. THE AUSTRALIANS APPRECIATE THAT ALL THE MAIN ALTERNATIVES TO THE PRESENT SITUATION POSE MAJOR PROBLEMS IN IMPLEMENTATION AND ARE LIKELY TO DISTURB THEIR POLITICAL RELATIONS ESPECIALLY WITH THE COUNTRIES IN SOUTH EAST ASIA WHICH WOULD BE EXCLUDED FROM THE CARRIAGE OF CHARTER TRAFFIC AND FROM THE PROPOSED

QUOTE SUPER APEX UNQUOTE FARE. HOWEVER, ROWL AND STRESSED THAT THERE IS WIDESPREAD DISSATISFACTION IN AUSTRALIA WITH THE PRESENT SYSTEM AND A BELIEF (NOT WHOLLY SPARKED OFF BY LAKER'S INTERVENTION) THAT THERE IS SCOPE FOR LOWER FARES ON THE MAIN VFR ROUTES BETWEEN AUSTRALIA AND EUROPE. THEY ARE THEREFORE ATTRACTED BY ALTERNATIVES (C) AND (D) ABOVE WHICH THEY SEE AS OFFERING THE ONLY REAL PROSPECT FOR LOWER FARES ON AN ECONOMIC BASIS.

9. BOTH MR NIXON AND HIS OFFICIALS STRESSED THAT THEY WOULD NOT BE PREPARED TO ENTERTAIN GIVING LAKER A MONOPLY OF CHARTER OPPORTUNITIES ON THE UK/AUSTRALIAN ROUTE. THEY WOULD EXPECT THAT IF THEY WERE TO ADOPT EITHER ALTERNATIVES (C) OR (D) THEY WOULD WISH TO MAINTAIN 3RD/4TH FREEDOM ROUTES TO GREECE AND ITALY (AND POSSIBLY ALSO GERMANY AND YUGOSLAVIA) AND THAT THIS WOULD BE LIKELY TO LEAD TO A MAJOR ROW WITH SEVERAL EUROPEAN COUNTRIES. HOWEVER, IN THE PRESENT STATE OF AUSTRALIA'S RELATIONS WITH THE EEC THIS IS NOT RULED OUT: AND BOTH HR NIXON AND HIS OFFICIALS INDICATED THAT IN MAKING THEIR EVENTUAL CHOICE THEY WOULD HEED TO WEIGH VERY CAREFULLY ON THE ONE HAND THE VERY REAL BENEFITS TO CONSUNEER (ESPECIALLY AUSTRALIAN CONSUMERS) FROM THE ADOPTION