TNAG-0965-FCO40-1184-Air-services-between-the-UK-and-Hong-Kong-1980 — Page 127

GR 400

also at: HKK 280/1

CONFIDENTIAL

HKK 340/1 знорі

HEK 1846

CONFIDENTIAL ECENED IN EGISTRY MO. 51

FM HONG KONG 310348Z MAY 8Ø

-A JUN 1980'

REGISTRY

Action

78

Cra

TO PRIORITY F C O

TELEGRAM NUMBER 703 OF 31 MAY

FOR PUS FROM GOVERNOR.

INDEX

мо

Jent

1. A CONJUNCTURE OF UNRELATED ISSUES HAS PROVOKED HERE AN UNPLEASANT GUST OF DISSILLUSIONMENT WITH THE UK. THIS CONTRASTS WITH THE FAVOURABLE TREND OF RECENT YEARS, PARTICULARLY SINCE THIS GOVERNMENT TOOK OFFICE. UNFORTUNATELY WE ARE SHORTLY TO REVISE THE DEFENCE COSTS AGREEMENT AND THEREAFTER MOVE INTO THE PRELIMINARIES OF RENEWAL OF THE MULTI-FIBRE TEXTILE AGREEMENT. THE FORMER IS LIKELY TO RESULT IN HONG KONG PAYING MUCH MORE TO THE UK AND THE LATTER IN THE UK DOING MUCH LESS FOR HONG KONG THAN THE PUBLIC WOULD LIKE. IT WOULD BE HELPFUL TO GET THINGS

BACK ON AN EVEN KEEL FIRST.

2. THE ISSUES (ABOUT WHICH THE DEPARTMENT IS DOING ITS BEST) ARE:- A) THE CAA DECISION TO GIVE THE LONDON/HONG KONG AIR ROUTE (IN COMPETITION TO BA) TO BCAL INSTEAD OF CATHAY PACIFIC (CP),

NOW UNDER APPEAL TO THE S OF S FOR TRADE.

PY

оле

B) THE RAISING OF UNIVERSITY FEES FOR OVERSEAS (BUT NOT EEC)

STUDENTS, (ANYTHING TO DO WITH EDUCATION IS HIGHLY EMOTIVE). C) THE FORTHCOMING WHITE PAPER ON A NEW NATIONALITY ACT (THE LATTER HAS BEEN STIRRED UP BY A VISITING LABOUR MP, PARRY, WHO PROCLAIMED HONG KONG PEOPLE WERE TO BECOME SECOND CLASS CITIZENS)

3. COMPLETE SATISFACTION ON ONE OF THESE ISSUES WOULD CHANGE THE CLIMATE, AND SOME CONCESSION ON TWO WOULD PROBABLY DO SO. AN ADVERSE MINISTERIAL DECISION ON (A) WOULD TEAR IT.

4. LITTLE MORE CAN BE DONE ABOUT NATIONALITY, THAN I BELIEVE HAS BEEN DONE ALREADY BUT EITHER A REVERSAL OF THE CAA DECISION IN FAVOUR OF CP, OR EEC FEE-TREATMENT FOR HONG KONG STUDENTS

WOULD PROBABLY DO THE TRICK, BUT OF THE TWO I SHOULD HAVE THOUGHT THE FORMER WAS POLITICALLY AND LEGALLY EASIER, AND IS THE HOTTER

ISSUE HERE.

5. IF NEITHER OF THESE MOVES ARE STARTERS PERHAPS YOU COULD

CONTRIVE TO COMBINE:-

A) PERSUADING MR NOTT TO SPLIT COMPETITION WITH BA BETWEEN CP

AND BCAL, AND

B) PHASE IN FULL UNIVERSITY FEES FOR HONG KONG STUDENTS OVER A

PERIOD TO GIVE TIME FOR ADJUSTMENT.

CONFIDENTIAL

16.

102