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5. THE AUSTRALIANS THROUGHOUT STRESSED THE DOMESTIC
POLITICAL IMPORTANCE THEY ATTACHED TO ACHIEVING CHEAP FARES. THEY TOOK THE LINE THAT THE PROPOSALS PRESENTED ARE THE BEST TO ACHIEVE THIS MAIN OBJECTIVE, AND THAT THE LESS GOOD ALTERNATIVES WOULD STILL HAVE THE SAME IMPLICATIONS FOR OTHER COUNTRIES. THEY DECIDED THEREFORE THAT IT WAS BETTER TO ADDRESS THE PROBLEM FOR THE INTERMEDIATE COUNTRIES EXPLICITLY BY OPTING FOR THE THIRD/FOURTH FREEDOM ONLY REGIME. WE ARE GRATEFUL TO YOU AND OTHER POSTS WHO SENT COMMENTS IN REPLY TO FCO TELNO 159 TO SINGAPORE (NOT COPIED TO ALL). PARAS 6 TO 14 BELOW CONSIDER THE EFFECTS, AS WE AND THE AUSTRALIANS ESTIMATE THEM, ON EACH COUNTRY SEPARATELY.
6. ALL THE MID-POINT COUNTRIES IN S E ASIA AND INDIA WOULD BE AFFECTED TO SOME EXTENT, BUT WITH THE EXCEPTION OF SINGAPORE, THE EFFECT MIGHT BE LESS THAN MIGHT APPEAR AT FIRST SIGHT.
7. WE WOULD HAVE TO REDUCE SIA SERVICES BETWEEN SINGAPORE AND LONDON FROM 7 TO ABOUT 3 A WEEK: AND THE AUSTRALIANS WOULD HAVE TO REDUCE SIA SERVICES BETWEEN SINGAPORE AND AUSTRALIAN POINTS FROM 14 TO ABOUT 5 A WEEK. TOURIST TRADE WOULD SUFFER IMMEDIATELY FROM FEWER SHORT STOPS BY PASSENGERS EN ROUTE TO AND FROM EUROPE. HOWEVER, CALCULATIONS DONE BY THE AUSTRALIANS ON THE ASSUMPTION THAT, ONCE THE SYSTEM HAD SETTLED DOWN, MORE AUSTRALIANS WOULD SPEND LONGER HOLIDAYS IN SINGAPORE SUGGEST THAT SINAGPORE'S NET LOSS ON TOURISH FROM AUSTRALIA COULD BE AS LOW AS AUSTRALIAN DOLLARS 3 MILLION PER YEAR.
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8. WE AGREE WITH THE ANALYSIS IN PARA 2 OF KUALA LUMPUR TELNO 292 TO LONDON. WE WOULD NOT (REPEAT NOT) FIND IT NECESSARY TO REDUCE THE TWO MAS SERVICES PER WEEK TO LONDON. IN ADDITION. THE AUSTRALIANS MIGHT DECIDE TO WITHDRAW QANTAS FROM THE MALAYSIA-AUSTRALIA SERVICE AND LEAVE IT IN THE HANDS OF MAS. THEY ALSO SEE THE POSSIBIL- ITY OF MORE AUSTRALIAN TOURISTS HAVING LONGER STAYS IN MALAYSIA, BUT THE LATTER WOULD NEED TO UNDERTAKE MORE PROMOTION OF THEIR OWN TOURIST ATTRACTIONS. HOWEVER, WE AGREE THAT THE MALAYSIANS ARE LIKELY IN PARTICULAR TO REACT AT LEAST INITIALLY AS SUGGESTED IN PARA 5 OF KUALA LUMPUR TELNO 292, BECAUSE THEIR ASPIRATIONS FOR MAS'S GROWTH WOULD RISK BEING THWARTED.
9. THAILAND COULD PARTIALLY OFF-SET THE LOSS OF THE RIGHT TO CARRY THROUGH TRAFFIC BY GAINS WHICH THEY WOULD MAKE FROM THE EXCLUSION OF QANTAS FROM THE BANGKOK-LONDON SECTOR. WE WOULD NOT NEED TO CUT THAI SERVICES TO LONDON AND AUSTRALIANS ARE CONFIDENT THAT SERVICES FROM THAILAND TO AUSTRALIA WOULD BE VIABLE. ALTHOUGH THE AUSTRALIANS MIGHT REDUCE QANTAS SERVICES TO THAILAND, THEY WOULD NOT WANT TO GIVE THE THAIS A MONOPOLY.
10. BA ARE CONFIDENT THAT TRAFFIC BETWEEN LONDON AND INDIA COULD BE CARRIED ON TURN ROUND SERVICES OR EN ROUTE TO HONG KONG OR SINGAPORE. WE WOULD NOT WANT TO CUT. AIR INDIA'S SERVICES TO THE UK. THE TOTAL NUMBER OF INTERNATIONAL SERVICES WITH TRAFFIC RIGHTS BETWEEN INDIA AND AUSTRALIA WOULD HAVE TO BE REDUCED FROM 16 TO 1 A WEEK. BUT THERE IS LITTLE TRAFFIC ON THE ROUTE AND THE AUSTRALIANS MAY DECIDE TO LEAVE IT IN THE HANDS OF THE INDIANS. THEY WILL ALSO BE PREPARED TO HELP THE INDIANS DEVELOP AUSTRALIAN TOURISM IN INDIA. INDIA IS LIKELY TO BE IMPORTANT TO THE AUSTRALIANS FOR TECHNICAL STOPS.
11. INDONESIA IS LIKELY TO BE ONLY MARGINALLY AFFECTED. SHE IS ALREADY CONCERNED TO CONFINE AIR TRAFFIC EXCHANGES TO THE THIRD AND FOURTH FREEDOMS.
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/12. THE AUSTRALIANS
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