TNAG-0863-FCO40-1073-Involvement-of-Hong-Kong-in-air-services-agreements-1979 — Page 33

CONFIDENTIAL

PROVED THAT THEY WOULD NOT, BUT HE IMPLIED THAT THERE MIGHT BE A NEED TO AGREE RESTRICTIONS ON CAPACITIES FOR ASEAN AIRLINES.

4. RAJARATNAM SAID THAT WHEN ASEAN NEXT MET THE AUSTRALIANS ON 2 MAY THEY WOULD DISCOVER WHETHER THE AUSTRALIAN OFFER TO

CONSIDER ASEAN PARTICIPATION IN THE END-TO-END SERVICES WAS

SERIOUSLY MEANT. HE HOPED THAT HIS OPTIMISM WOULD BE PROVEN

RIGHT. IF IT WERE, AUSTRALIA AND THE ASEAN COUNTRIES WOULD

HAVE TO CONSULT THEIR EUROPEAN AIRLINE PARTNERS TO FIND OUT IF

THEY ALSO AGREED. HE HOPED THERE WOULD BE NO PROBLEMS WITH

THEM AND HAD WRITTEN TO THE SECRETARY OF STATE AND TO

HERR GENSCHER TO URGE THIS.

5. I FIND IT DIFFICULT TO BELIEVE THAT THE AUSTRALIANS EXPECT

THE ASEAN COUNTRIES TO COME UP WITH A SCHEME WHICH WILL PROVE

THEIR CASE QUITE APART FROM THE FACT THAT TO ALLOW A THIRD

COUNTRY AIRLINE ACCESS TO END-TO-END TRAFFIC WITHOUT STOPO VER

WILL INTRODUCE, WHATEVER SINGAPORE MAY ALLEGE TO THE CONTRARY, A NOVEL PRINCIPLE INTO THE REGULATION OF INTERNATIONAL AIR

SERVICES (APART FROM THE LIMITED BREACH WHICH IS MADE BY OUR ALLOWING ONE OR TWO AIRLINES, AIR INDIA AND IRAN AIR AMONG THEM, TO PICK UP PASSENGERS IN LONDON FOR NEW YORK). IT SEEMS TO ME THAT THE AUSTRALIANS MAY BE HOPING THAT THE DIFFICULTIES WILL ARGUE FOR THEMSELVES: PARTICIPATION IN THE END-TO-END SERVICES WITHOUT STOPOVER WILL THEN BE SEEN TO BE A NON-STARTER, AND DISCUSSIONS WILL REVERT TO THE ISSUE OF THE LEVEL OF THE STOPOVER FARES. I IMAGINE, TOO, THAT WE AND BA WOULD HAVE. SOMETHING TO SAY IF, CONTRARY TO MY EXPECTATIONS, THE AUSTRALIANS SHOVED THEMSELVES READY TO CONCEDE END-TO-END ACCESS TO THE TRUNK ROUTE TO SIA (AND OTHER ASEAN CARRIERS) WITHOUT STOPOVERS.

THERE HAS ALWAYS BEEN AT THE BACK OF MY MIND THE FEAR THAT AT

SOME TIME WE MAY BE FACED WITH PROPOSALS WHICH WE COULD NOT GO

ALONG WITH AND SO GATHER TO OURSELVES THE 03LOQUY WHICH HAS UP

TO NOW BEEN VISITED ON THE AUSTRALIANS. THIS COULD HAPPEN IF

THE AUSTRALIANS AND ASEAN AGREED FARES FOR THEIR SECTOR WHICH

WOULD ONLY ALLOW ASEAN TO PLY FOR STOPOVER TRAFFIC BETWEEN

AUSTRALIA AND LONDON IF THE FARE FOR THE ASEAN-LONDON SECTOR

WERE TO BE REDUCED TO A DERISORY AND UNECONOMIC FIGURE.

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6. IN TALKING