TNAG-0862-FCO40-1072-Involvement-of-Hong-Kong-in-air-services-agreements-1979 — Page 66

GRS 1960

CONFIDENTIAL

FM CANBERRA 263500Ż JAN 79

TO IMMEDIATE FCO

CONFIDENTIAL

HCK 184/1

RECEIVLO

7

69A

TELEGRAM NUMBER 66 OF 26 JANUARY

PA

INFO ROUTINE SINGAPORE KUALA LUMPUR JAKARTA BANGKOK ! MANILA WELLINGTON HONG KONG (GOVERNOR AND BCARFE)

MT TEL NO 53: UK/AUSTRALIA AIR SERVICES

४

-ken

1. THE AFTERNOON OF JANUARY 24 WAS WHOLLY TAKEN UP WITH THE DISCUSSIONS ON CHARTERS. MR C NUNN OF LAKER AIRWAYS ATTENDED AS OBSERVER. ROGERS MADE IT PLAIN THAT THIS DID NOT NECESSARILY IMPLY THAT IF CHARTERS WERE PREMITTED LAKER AIRWAYS WOULD BE

CHOSEN.

2.

י

AT ROGERS' INVITATION OVERALL (CAA) PRESENTED THE UK CASE FOR INCLUSION OF A MODEST CHARTER PRESENCE ON THE UK-AUSTRALIA ROUTE AS A COMPETITIVE SPUR TO THE SCHEDULED CARRIERS AND THUS AS

A PROTECTION OF CONSUMER INTEREST. HE DREW ON ANALOGIES OF OTHER ROUTES OUT OF THE UK WHERE THE INTRODUCTION OF CHARTERS HAD LED TO A LOWERING OF AIR FARES WITHOUT DETRIMENT

TO THE SCHEDULED CARRIERS AND THE MAINTENANCE OF ADEQUATE

SCHEDULED FREQUENCIES. WHILST ACKNOWLEDGING THE DANGERS INHERENT

IN THE INTRODUCTION OF CHARTERS EARLY IN THE PERIOD OF WHAT

WAS A RADICAL CHANGE IN THE ARRANGEMENTS FOR SCHEDULED CARRIERS HE

SUGGESTED THAT WE SHOULD EXAMINE THE POSSIBILITIES FOR THE INTRODUCTION OF CHARTERS TO PROVIDE THE NECESSARY CAPACITY TO CATER FOR GROWTH IN THE MARKET WHICH WOULD OCCUR FROM

THE INTRODUCTION OF THE NEW LOW FARES AS WELL AS THE GROWTH

WHICH THE CHARTER OPERATORS THEMSELVES WOULD ALSO GENERATE.

3.

ROWLAND RESPONDED DRAWING LARGELY ON THE ARGUMENTS SET OUT IN THE AUSTRALIAN PAPER WHICH WE RECEIVED IN SEPTEMBER. HE STRESSED THE NEED FOR THE AUSTRALIAN FEDERAL GOVERNMENT TO BE RESPONSIVE TO PRESSURES FROM THE STATE GOVERNMENTS OFR THE MAINTENANCE OF AN ADEQUATE LEVEL OF SCHEDULED SERVICES AT ALL THE AUSTRALIAN GATEWAY POINTS, THE NUMBER OF WHICH MIGHT WELL INCREASE, THE PROPOSED NEW LOW FARES REGIME HAD HAD TO -

CONFIDENTIAL

/TAKE