TNAG-0863-FCO40-1073-Involvement-of-Hong-Kong-in-air-services-agreements-1979 — Page 164

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HONG KONG PAPER

Why does Hong Kong distrust UK delega- „tions& ab ility and good intentions

in communications with HMG during negotiations?

(Para.21)

ADDITIONAL UK COMENT

The leader of a UK delegation must necessarily have discretion to communicate in confidence with his own Government and it seems entirely unreasonable for Hong Kong to expect that its officials should have access, to such communications. The Hong Kong advisers should already have adequate means for making their views clear to HMG. There has never, as far as is known, been any

suggestion that Hong Kong advisers cannot communicate with Hong Kong -or that Hong Kong lacks the ability to do so with HMO. No cases are cited to suggest why Hong Kong should fear that the leader of the UK delegation a senior UK official or Minister be responsible for EMG for the conduct of thenegotiations will represent to HMO any distorted view of Hong Kong!s

interests.

Recent negotiations involving Hong Kong interests

32.

the

Having established above Hong Kong's status vis a vis air service negotiations and the wider framework within which the UK nogotiates traffic rights for CPA, it is necessary to turn to the Hong Kong paper's theme that the UK has not looked after CPA's interests as well as it might particularly in the Malaysia/Singapore negotiations, which aredescribed in para.13 as having been damaging to CPA. This is the only specific negotiation cited and to go on from this single example, paper does, to envisage the complete collapse of CPA seems unduly glomy, given the thriving condition of CPA as presented elsewhere in the paper.

is the.

32. The Hong Kong paper maintains that possible benefits for CPA are passed over in . favour of bebefits for another British airline. Fortunately, our experience is that in most negotiations the situation does not pose a direct choice (or even the appearance of a choice, which can be misleading) between one UK aviation interest and another and no conflict is therefore set up in most cases. Naturally from time to time situations may arise where it is necessary to measure one British airlines interest against another and not only in relation to Hong Kong..

33.

It is relevant to examine the Hong Kong allegations in the light of three major- negotiations over the last two years and more in which Hong Kong's interests have been part of the UK's bargaining position namely the negotiations with Japan, with the USA and with Singapore/Malaysia.

Japan

It suffices to say that the last two rounds of negotiation with Japan, in Spring 1965 and Winter 1967, have been devoted entirely, so far as positive outcome in British rights were concerned, to meeting the needs and advancing the interests of CPA as put forward by the Hong Kong Government,

USA

At the end of the day, the only point at issus directly affecting by, potential US Competition, Hong Kong'a airline interests was the American bid for Osaka/ Taipei/Hong Kong rights. In fact these seotors were entirdy blinded to the US airlines for passenger traffio, and we went some way to put the entire deal at risk by sticking out on this. Rights were gained for CPA through Okinawa in which we see they are interested enough to have obtained the necessary CAP permit. Special safeguards were written into the confidential material to check flooding of capacity on the routes through Hong Kong. At the same time) and looking at it globally, the long distance route rights from the USA into Hong Kong were added to in a way beneficial as a world centre for travel routes a situation which is of undoubted benefit to the colony's economy and tourism, and pours traffic into the pool of available business from which CPA, as the

7.