CONFIDENTIAL
followed by a more formal Confidential Memorandum of Understanding signed on 24 November 1977. As MAS's $35 million profit for 1978 shows, the deal was not altogether unfavourable to them.
3. The agreement, however, left the Malaysians disgruntled, because of the formula under which MAS had to pay up to £1 million a year to BA as compensation for Sixth Freedom traffic, mainly from Australia, and to concede extra route points to Cathay Pacific. Britain, they said, had "taken them to the cleaners” and been very unsympathetic to their reasonable aspirations for their young airline "wielding the big stick to drive a hard bargain" at a time when Malaysian Ministers faced heavy political criticism at home if their new DC10s lay unused. Furthermore, Malaysian officials felt they had received rough handling and spread pained stories about "the new breed of British official" they had had to contend with.
4. Meantime, we sought formal approval for Concorde flights at supersonic speeds on a route discussed with the Malaysians early in 1977. A Note seeking formal clearance was presented to the Ministry of Foreign Affairs on 21 October 1977, 10 days after the exchange of Aides Memoires, no real difficulty having been foreseen, although danger signals had earlier been reported from here. The Malaysians claimed that delivery of the Note so immediately after the tough negotiations implied duplicity on our part, as well as arrogance that their approval could be assumed. Posters advertising the new Concorde service in SIA livery were put up all over Kuala Lumpur and fuel was thereby added to official dissatisfaction. Jealousy of Singapore, unspoken and inadmissible, was real.
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