TNAG-0867-FCO40-1077-Air-services-between-China--Hong-Kong-and-the-UK-1979 — Page 17

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CONFIDENTIAL

Reference.....

Mr Quantrill

Mr McLaren

UK/CHINA AIR SERVICES AGREEMENT

AKK 184/2.

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1. I had lunch at John Swire and Sons on Friday. After the lunch John Swire, John Browne and Tommy Tomkins expressed to me their concern that Cathay Pacific were not being invited to take part in the discussions in Peking on this Agreement later this month. They said that this was particularly galling as Mr Shen Tu, the Director General of the General Administration of Civil Aviation of China, had invited Mr Donald Bluck of Cathay Pacific to go to Peking to discussions also later this month, which invitation has been accepted.

2. I explained that the Chinese had made it very clear that the discussions were to be on the ASA and the London/Peking trunk route and not on the "regional routes". Although HMG would like them to include the latter, the inclusion of Cathay Pacific in the party to go to Peking could be provocative and complicate the arrangements. I thought it politic to say this and no more. Swires people said that they now understood the position much better and appeared content.

3.

The

I took the opportunity to enquire about the state of the Cathay Pacific/BA discussions on the establishment of a new airline to operate the "regional routes". I was told that the discussions had been suspended pending Mr Bluck's visit to Peking and because Swires had learned that BA were holding similar discussions with P Jardines. I did not of course comment on this.

4. The delay in reporting this is regretted.

9 May 1979

Qwikianum.

P J Williamson

Hong Kong and General Department

It has of couse now been agreed that the CPA representative should attend the Peking talks (if they ever take place!) as an

observer.

Wuantill

CONFIDENTIAL

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