TNAG-0781-FCO40-985-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 277

Mr H G Darwin

Legal Advisers K159

CONFIDENTIAL

Reference.......

FEC 184/1

531

Станкриви 184

RECETVLORE PEGISTRY NO. 51

OFFICER

1978

K

IND

PA

Acro Turen

No

*

་ས

A

B

C

D

E

UK/CHINA AIR SERVICES AGREEMENT

1.

In 1973 the UK and China initialled the text of a proposed Air Services Agreement (the text is inside front cover of the attached file). Hog

2.

Shortly afterwards, in the course of negotiations with Japan for an Air Services Agreement, the Chinese extracted certain concessions from the Japanese relating to Japan's attitude towards Taiwan. The Chinese then presented the UK with five extra conditions relating to Taiwan which they wanted the UK to meet before our own Air Services Agreement could be signed. A note on the Chinese conditions is at Flag B. The UK regarded these conditions as unacceptable and maintained that the UK was ready to sign the Agreement as initialled. A stalemate ensued until recently when in discussions between the Chinese Foreign Minister and Mr Del1, and HM Ambassador Peking and the Ministry of Foreign Affairs, the Chinese hinted that their attitude towards their conditions may have become more flexible. The Chinese Foreign Minister said that he hoped the problem could be resolved on the Japanese pattern.

3.

Research Department have completed further study of the circumstances surrounding the conclusion of the Sino/Japanese Air Services Agreement (Miss Pares' minute of 28 September). Following discussion between officials of the FCO and DOT it was agreed that there would be commercial benefit to British Airways in signing an Air Services Agreement under the terms of the initialled text, although there were further improvements which the UK side would wish to make if an opportunity arose: that it was important to preserve the revenues which Hong Kong's airline, Cathay Pacific Airways, gained from its services to and over Taiwan: and that the next step towards seeking a solution should be for the UK side to consider the terms of a public statement about our attitude towards Taiwan which would at the same time satisfy the Chinese

and avoid provoking Taiwanese reaction against Cathay Pacific Airways. A proposed form of words is annexed to Mr Bryant's (DOT) letter of 22 September to Mr Samuel. (It may of course be worth trying to offer to repeat the statement given on the occasion of the exchange of ambassadors in 1972 (Flag E): but we must assume for planning purposes that this will not work.)

GODE 18 - 17

CONFIDENTIAL

14.