TNAG-0863-FCO40-1073-Involvement-of-Hong-Kong-in-air-services-agreements-1979 — Page 168

7.

3

A high proportion of the Company's dividends are therefore available to shareholders for remittance to the United Kingdom and go to

assist UK companies and the UK economy in general. In each of the years

1960 and 1961 dividends amounted to 3500,000, whilst for the three years

1962-64 no dividends were declared. In 1965, dividends amounted to

HK$2 million; in 1966 to HK33 million.

8.

The airline's ton mileage has grown from 6,018,000 in 1948 to 71,041,000 in 1966, a percentage growth of 1,080. Revenues have grown similarly and in 1966/67 earnings will be about HK$144 million. The airline states that, of this, HK392 million (64%) is earned in the non-sterling. area and HK 52 million (36%) in the sterling area, whilst expenditure totals HK$35 million (31%) in the non-sterling area and HK$76 million (69%) in the

sterling area. The airline calculates its contribution to the sterling area

as HK$89 million 1.e. HK$144 million less HK320 million capital expenditure

and HK$35 million non-capital expenditure in non-sterling areas. It has

not been possible to verify these figures but there appears to be no reason

to doubt them.

9.

The benefit to Her Majesty's Government of a British regional

airline with a dominating position in this area is therefore obvious.

of the more tangible direct benefits of this is CPA's contribution of

HK35 million per annum of interline revenue to British Overseas Airways

Corporation.

One

C. THE VALUE OF CATHAY PACIFIC AIRWAYS TO HONG KONG INTERESTS

10.

(i) Staff. CPA emplov 800 staff domiciled in Hong Kong with

salaries totalling HK$13 million per annum. In addition CPA provide work

in Hong Kong through Butterfield and Swire and Hong Kong Aircraft Engineering

Corporation for a further 570 employees earning HK$7 million per annum.

(ii) Buildings. CPA have a building at Kai Tak, and will shortly erect a new building at a capital cost of HK324 million.