TNAG-0964-FCO40-1183-Air-services-between-the-UK-and-Hong-Kong-1980 — Page 17

CONFIDENTIAL

THE POLITICAL SITUATION

THE HONG KONG GOVERNMENT ACCEPTS THAT IT WOULD BE POLITICALLY DIFFICULT FOR THE SECRETARY OF STATE TO REPLACE BCAL BY CATHAY ON APPEAL. BUT THE PROBLEM WOULD BE SOLVED BY FOLLOWING THE DECISION OF THE HONG KONG ATLA AND LICENSING BOTH BCAL AND CATHAY. THERE IS NO DOUBT THAT SUCH A DECISION WOULD SATISFY PUBLIC OPINION IN HONG KONG AND RESOLVE THE POLITICAL PROBLEM.

SO FAR AS THE VIABILITY OF A THREE-CARRIER REGIME IS CONCERNED, THE HONG KONG GOVERNMENT MADE ITS POSITION CLEAR IN ITS SUBMISSION ON APPEAL (PAGE 6 OF LETTER DATED 9 APRIL, 1980 FROM HEWITT, WOOLLACOTT AND CHOWN) 1.E. THAT IN ITS VIEW THERE IS NO REASON WHY A 3-CARRIER REGIME SHOULD NOT BE VIABLE.

HONG KONG GOVERNMENT.

21 MAY, 1985.

ENDS.

MACLEHOSE

[COPIES SENT TO CAIR/DOT]

FILES

HK- & GD (4)

MAED

MR MURRAY

MR EVANS

MISS BROWN

COPIES TO:

MR GARDINER LEGAL ADVS.

HONG KONG GOVT.OFFICE

CONFIDENTIAL