TNAG-0868-FCO40-1078-Air-services-between-China--Hong-Kong-and-the-UK-1979 — Page 78

GR 875

CONFIDENTIAL

CONFIDENTIAL

777

FMEKING 159800Z JUNE 79

TO IMMEDIATE FCO

TELEGRAM NUMBER 564 OF 15 JUNE 79-

INFO IMMEDIATE HONG KONG

DESKBY FCO 151100Z

FOLLOWING FROM DELEGATION

HKK 184/2

Reciv.0.

INS

ло

19 JUN 1979

жет раж (80

See /180

176)-MIPT: UK/PRC AİR SERVICES NEGOTIATIONS

1. WE HOPE YOU WILL FIND THE FOLLOWING COMMENTS ON HONG KONG

TELNO 791 HELPFUL. REFERENCES ARE TO PARAGRAPHS IN THAT

TELEGRAM.

2. PARA 2. ALL THE INFORMATION AVAILABLE HERE INDICATES THAT THE CHINESE ARE PROCEEDING MORE CAUTIOUSLY WITH THEIR DEVELOPMENT PLANS AND HAVE DECIDED ON A MUCH SLOWER RATE OF HOTEL CONSTRUCTION THEN PREVIOUSLY ENVISAGED. IF WE WAIT FOR PRESSURES TO GROW ON THEIR SIDE WE MAY WELL HAVE TO WAIT SEVERAL YEARS FOR A MORE FAVOURABLE OPPORTUNITY TO NEGOTIATE ABOUT THE REGIONAL

SERVICES.

3. PARA 5. WE AGREE THAT AS VIEWED BY THE PUBLIC WE SHALL

HAVE GOT VIRTUALLY THE SAME FOR BRITISH AIRWAYS AS UNDER THE

1973 AGREEMENT (ALTHOUGH IN PRACTICE THE ROUTE SCHEDULE IS MUCH IMPROVED AND THE OPPORTUNITY TO START WITH 2 X B747S IS EXTREMELY VALUABLE). HOWEVER, EVEN IN AIR SERVICES TERMS WE COULD DEMONSTRATE MAJOR GAINS FROM OPTION A, NOTABLY:

A. WE WOULD HAVE ESTABLISHED THE PRINCIPLE OF DUAL

DESIGNATION WHICH THE CHINESE HAVE NOT GRANTED TO ANY

OTHER COUNTRY AND WHICH IS GOING TO SET AN EXTREMELY AWKWARD PRECEDENT FOR THEIR FORTHCOMING NEGOTIATIONS WITH THE UNITED STATES. THIS IS A CONCESSION OF

FIRST RATE IMPORTANCE WHICH HAS BEEN SECURED ONLY IN THESE NEGOTIATIONS AND WHICH THE CHINESE MIGHT WELL WITHDRAW IF WE WERE TO GO FOR OPTION C AS HONG KONG

SUGGEST.

CONFIDENTIAL

/B. WE WOULD