TNAG-0778-FCO40-982-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 74

GR 275

CYPHER/CAT A

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(242

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· 2 MAY 1978

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INDEX

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PA

AUT

MO. 40. 51

CRET «

Adjon Taken

FM HONG KONG 280943Z

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TO ROUTINE F.C.O TELNO.540 OF 28 APRIL 78,

INFO JAKARTA, HONG KONG GOVT OFFICE LONDON.

по

wilf

DOT TELNO.ALLOT 64: U.K/INDONESIA AIR SERVICES.

1. THERE ARE TWO ASPECTS TO THE CPA REPLY, OPERATIONAL FEASIBILITY AND ECONOMIC VIABILITY.

2. IN THE CASE OF HONG KONG/EAST AUSTRALIA. ROUTES, THEY BELIEVE

AN ACCEPTABLE ROUTE COULD BE OPERATED ON A TRACK HONG KONG/MANILA/ GUAM/PORT MORESBY TO SYDNEY AND MELBOURNE. ON THESE SERVICES, THEY WOULD BE FACED WITH SUBSTANTIALLY INCREASED FLYING TIME AND A REQUIREMENT FOR EN-ROUTE TECHNICAL CALLS AND CREW SLIPS AT EITHER GUAM OR MORE LIKELY PORT MORES BY. THESE FACTORS WOULD COMPLETELY DESTROY THE VIABILITY OF CPA'S HONG KONG/EAST AUSTRALIA

SERVICES WHILE, AT THE SAME TIME, THEY WOULD EXPECT TO SUFFER

A CONSEQUENTIAL LOSS OF THE MAJOR PART OF THEIR TRAFFIC TO QUANTAS

AND 6TH FREEDOM OPERATORS' FASTER SERVICES.

3. AS FOR HONG KONG/KUALA LUMPUR/WEST AUSTRALIA SERVICES, CPA

WOULD BE FACED WITH UNACCEPTABLE ECONOMIC AND OPERATIONAL PROBLEMS THE CURRENT SERVICES ARE ONLY MODESTLY PROFITABLE WITH REVENUE DERIVED FROM TRAFFIC TO AND FROM JAKARTA BEING A CRITICAL COMPONENT. THE LOSS OF SUCH REVENUE ON THE SECTORS HKG/JKT KUL/JKT AND JKT/PER AND VICE VERSA, TOGETHER WITH A VASTLY INCREASED FLIGHT TIME KUL/PER ON A ROUTE CIRCUMNAVIGATING NORTH

SUMATRA, WOULD RESULT IN LOSSES WHICH CPA COULD NOT SUSTAIN. FROM AN OPERATIONAL VIEWPOINT, CPA CONSIDER A ROUTE KUL/PER VIA THE COCOS ISLANDS WOULD BE UNACCEPTABLE.

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74. IN SUMMARY,