TNAG-0865-FCO40-1075-Involvement-of-Hong-Kong-in-air-services-agreements-1979 — Page 197

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TELEGRAM NUMBER 527 OF 12 JULY

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YOUR TELNO 972, OUR TELNO 191 TO KUALA LUMPUR AND KUALA LUMPUR TELS NOS 252 AND 254, .UK/MALAYSIA AIR SERVICES: FOLLOWING FROM MAED

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1. DURING HIS RECENT VISIT TO MALAYSIA, THE SECRETARY OF STATE AGREED THAT THE NEXT ROUND OF AIR SERVICES DISCUSSIONS SHOULD BE AT

MINISTERIAL LEVEL, THEY WILL START. IN LONDON ON 17 JULY, AND THE PARLIAMENTARY UNDER SECRETARY OF STATE FOR TRADE (MR TEBBIT)

WILL LEAD ON OUR SIDE.

2. OUR AGREEMENT TO MINISTERIAL TALKS WILL HAVE RAISED MALAYSIAN,

EXPECTATIONS THAT A DEAL, OR AT LEAST THE BASIS OF A DEAL, WILL BE FORTHCOMING, AND THE CONSEQUENT DISAPPOINTMENT IF IT IS NOT WILL BE THAT MUCH GREATER. AT HIS MEETING WITH LORD CARRINGTON, HUSSEIN ONN

STRESSED THAT IF IN THE NEGOTIATIONS WE DID NOT SHOW CONSIDERATION

FOR MALAYSIAN INTERESTS, ANTI-BRITISH GROUPS WOULD EXPLOIT THIS TO

THE DETRIMENT OF OUR OVERALL RELATIONS. BEARING IN MIND THE

FORTHCOMING COMMONWEALTH PRIME MINISTERS CONFERENCE AND THE

DIFFICULTIES OVER THE VIETNAM REFUGEES WHICH SEVERELY TROUBLE THE MALAYSIANS AS WELL AS OURSELVES IN HONG KONG PARTICULARLY, THERE

WOULD BE ADVANTAGES IN GETTING THE DIFFICULTIES WITH THE MALAYSIANS

OVER AIR SERVICES OUT OF THE WAY.

3. WE HAVE THEREFORE GIVEN CAREFUL CONSIDERATION TO THE MINIMUM WE. THINK THE MALAYSIANS WILL SETTLE FOR AND THE EXTENT TO WHICH WE ARE PREPARED TO PAY THE PRICE DEMANDED IN THE WIDER INTERESTS OF UK/

MALAYSIA RELATIONSHIPS.

4. ON THE TRUNK ROUTE, THE PROGRESSION OF MAS CAPACITY FROM 2 X DC10 NOW TO 4 BY OCTOBER 1980, PLUS THE MINOR ADJUSTMENTS ON TRAFFIC RIGHTS DISCUSSED DURING THE MAY/JUNE MEETING SHOULD SATISFY THEIR IMMEDIATE ASPIRATIONS. SIMILARLY, THE MOUNTING A DAILY A300

SERVICE FROM EARLY 1990 WITH PROGRESSION TO ANOTH WEEKLY SERVICE (SUBJECT TO DEMAND) BY APRIL 1931 SHOULD SATISFY THEIR THIRD/FOURTH

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