TNAG-0868-FCO40-1078-Air-services-between-China--Hong-Kong-and-the-UK-1979 — Page 204

GR 539

CONFIDENTIAL

CONFIDENTIAL

HKK 184/2

2 2 MAY 1979

FM HONG KONG 220855Z MAY

DESKBY F.C.0. 220980Z

• DESKBY PEKING 230030Z

PA

по

J22.5

TO IMMEDIATE F.CO.

:

Sex 118

TELEGRAM NUMBER 616 OF 22 MAY, 1979

AND TO IMMEDIATE PEKING

117)

INFO ROUTINE HONG KONG GOVT. OFFICE LONDON.

PEKING TELNO 467: UK/CHINA AIR SERVICES NEGOTIATIONS.

1. SEEN FROM HERE OUR BASIC OBJECTIVES ARE:-

(A) TO AGREE TO A TRUNK ROUTE WITH THE POSSIBILITY OF TRAFFIC RIGHTS BETWEEN HONG KONG AND PEKING, AND IF NECESSARY,

SHANGHAI:

(B) TO MAKE ARRANGEMENT FOR THE DEVELOPMENT OF REGIONAL ROUTES,

INCLUDING PEKING AND SHANGHAI, IN SUCH A WAY THAT A HONG KONG-BASED BRITISH AIRLINE CAN PARTICIPATE.

WE SEE NO OVER-RIDING OBJECTION TO TEMPORARY IMBALANCE IN FAVOUR OF THE CHINESE PROVIDING OPPORTUNITIES EXIST FOR THIS TO BE CORRECTED LATER.

4.

2. WE ARE NOT CLEAR WHETHER THE TWO ALTERNATIVES IN PARAGRAPH 7 WERE PUT FORWARD BY THE CHINESE OR WERE THE RESULT OF A COMPROMISE. FROM THE POINT OF VIEW STRICTLY OF THE STATUS OF HONG KONG WE SEE NO POLITICAL OBJECTION TO EITHER OPTION. NEITHER, HOWEVER, IS PARTICULARLY DESIRABLE AND BOTH HAVE OBJECTIONS FROM THE POINT OF VIEW OF HONG KONG INTERESTS.

3. WE FIND IT DIFFICULT TO COMMENT MEANINGFULLY ON THE TWO OPTIONS SET OUT IN PARAGRAPH 7 WITHOUT A CLEAR INDICATION OF HOW H.M.G. INTENDS TO APPORTION ANY BRITISH ENTITLEMENT SECURED FROM THE CHINESE AND WITHOUT A CLEARER INDICATION OF THE S.E. ASIAN POINTS

THAT THE CHINESE ARE SEEKING IN EXCHANGE FOR THE GRANTING OF ''BALANCED RIGHTS TO BRITISH AIRLINES AND CAAC BETWEEN HONG KONG

AND CITIES IN PRC''.

4. WE CONCUR WITH THE CPA VIEW THAT PEKING AND SHANGHAI ARE BY FAR THE MOST VALUABLE POINTS IN CHINA IN THE FORESEEABLE FUTURE. HOWEVER, IF THE RIGHTS TO SERVE THOSE POINTS WERE TO BE GIVEN TO ANY BRITISH OPERATOR OTHER THAN CPA UNDER OPTION A, THEN IN

CONFIDENTIAL

/ EFFECT