TNAG-2226-FCO40-3198-Political-relations-between-Hong-Kong-and-Vietnam-1991 — Page 20

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MDHIAN 5390

APPROACHED DTP AND WERE REFERRED TO ECONOMIC SERVICES BRANCH. THE FOLLOWING MONTH THEY APPROACHED CPA AND PROPOSED A JOINT VENTURE ARRANGEMENT. SHORTLY THEREAFTER, CPA RECEIVED A SIMILAR PROPOSAL FROM A MANILA BASED COMPANY REPRESENTING VIETNAM AIRLINES. OTHER LIKE APPROACHES HAVE BEEN MADE TO THE HKG VIA VARIOUS INTERMEDIARIES OVER THE PAST TWO OR THREE YEARS.

12. IT IS UNCERTAIN WHETHER AIR VIETNAM WOULD MEET HONG KONG'S SAFETY AND NOISE REQUIREMENTS. THE MAIN BENEFICIARIES OF ANY MOVE TO EASE RESTRICTIONS ON AIR SERVICES ARE THUS LIKELY TO BE HONG KONG AIRLINES. VIETNAMESE AIRLINES' INTEREST IN THESE SERVICES NEVERTHELESS SHOWS THAT VIETNAM REGARDS THEM AS A DEFINITE PLUS. THIS CARROT IS THUS VALUABLE, ALTHOUGH ON COMMERCIAL GROUNDS IT WOULD BE ADVISABLE NOT TO WITHHOLD IT TO THE POINT THAT ALTERNATIVE ROUTES BECOME FIRMLY ESTABLISHED AT THE EXPENSE OF AN EVENTUAL HONG KONG/VIETNAM ROUTE.

13. WITH REGULAR AIR SERVICES, WE MIGHT BE ABLE TO INCLUDE VOLUNTEERS (BUT NOT RESISTORS) ON FLIGHTS WHEN THESE WERE NOT FILLED BY REGULAR PASSENGERS. WE WOULD NOT BE ABLE TO DISPENSE COMPLETELY WITH CHARTER FLIGHTS. BUT REGULAR AIR SERVICES WOULD

GIVE US MORE FLEXIBILITY.

14. WE BELIEVE THAT TALKS SHOULD NOW BE STARTED WITH THE VIETNAMESE, TO ESTABLISH INTERAIRLINE ARRANGEMENTS (NOT AN ASA) FOR BILATERAL AIR SERVICES. IN PRACTICE IT IS MOST UNLIKELY THAT SUCH AIR SERVICES COULD START BEFORE THE SECOND HALF OF 1991. IN ANY TALKS WHICH WE HOLD WITH THE VIETNAMESE ON MANDATORY REPATRIATION IN THE FIRST HALF OF NEXT YEAR, WE WOULD HIGHLIGHT THIS MOVE ON OUR PART. WE COULD, IF NECESSARY, DELAY THE START OF ACTUAL SERVICES IF IT APPEARED THAT THIS WOULD PROVIDE US WITH LEVERAGE. BUT STARTING WITH DISCUSSIONS ON AIR SERVICES NOW WOULD MINIMISE THE RISK OF OTHER COUNTRIES GETTING TOO FAR AHEAD OF US. WE ALSO SEE ADVANTAGE IN TAKING A POSITIVE INITIATIVE OURSELVES NOW RATHER THAN CONTINUING TO KEEP THIS ONE UP OUR SLEEVES WHILE WAITING FOR SOME PROBABLY SLOW-TO-COME RECIPROCAL MOVE FROM THE VIETNAMESE.

CONSULAR RELATIONS

15. A FORMAL VIETNAMESE CONSULAR PRESENCE IN HONG KONG WOULD BE A MAJOR MOVE AND WOULD CERTAINLY BE SENSITIVE TO CHINA. IT WOULD NOT BE WELCOMED BY LOCAL PEOPLE UNLESS AND UNTIL A FULL-SCALE RETURN PROGRAMME FOR VBPS IS WELL ESTABLISHED. WE DO NOT THEREFORE PLAN TO OFFER THIS AT PRESENT.

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