TNAG-1176-FCO40-1478-Air-services-between-the-UK--China-and-Hong-Kong-1982 — Page 19

CODE 18-77

Reference..

HAKE 184/1

CONFIDENTIAL

Apolo Mi Houre

PA

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Mr Hoare HK&GD

ow. Sindon spoke to.

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8

A MILO

UK/PRC Air Services Talks.

9/12

53

Pehy

15/22

Following receipt of Mr Clift's minute of

7 December we discussed the current round of talks with the Chinese. I should now like to record the final line of approach agrced by the Department of Trade, which is summarised as follows:

Ga

a) The option of British Airways being permitted to operate unblinded on the Hong Kong Peking sector should not be put to the Chinese until at least the next round of talks, which will probably take place during March 1983.

b) Cathay Pacific should be allowed to make their own case to the Chinese with a view to their being accepted on the Peking route. A preliminary approach to the Chinese delegation leader (Lu Ruiling) inidcated that the Chinese are prepared to talk to Cathay, but that, because of 'wider issues',negotiat- ions are likely to be protracted and could take up to one year.

c)

If Cathay Pacific are unable to gain acceptance on the Peking route, we should prefer to see a "British Carrier "on the route rather than leave CAAC in a monopolistic position. This would mean in practice a British Airways designation unblinded, but if this came about it would be on a temporary basis (ie extended by one season at a time). If Cathay Pacific subsequently proved to be acceptable, British Airways would then be forced to serve notice of coming off the route.

9 December 1982.

бел

R.W. Sindon M.A.E.D.