TNAG-2310-FCO40-3350-Air-services-between-Hong-Kong-and-China-1991 — Page 24

1

APP briefing for Lard Braberan's

wsit to China, Feo1991

HONG KONG/PRC SERVICES

1181/6.

HKC181

1.

RECE

2 0 FEB 1991

SCHEDULED SERVICES

5.

b

P.a HK/China Air Servicer

Ch

Points to make:

Pleased to note that the new regional route arrangements agreed in March 1990 have been implemented smoothly. Hope that the arrangements will be reviewed in due course to ensure that the growing market demand as well as the interests of the airlines of both sides are catered for.

Background

After 5 rounds of negotiations, a new regional route package covering scheduled air services between HK and the mainland was agreed in March 1990. Under the new arrangements, CAAC is able to designate up to three of their newly formed regional airlines to operate the HK/PRC routes (Air china, China Eastern, China Southern have since been so designated). On the other hand, the UK may designate two Hong Kong-based airlines (Dragonair is now the only designated airline following the withdrawal of CPA from the Peking and Shanghai routes in April 1990). Scheduled services are operated by PRC airlines and Dragonair on 7 routes: Peking, Shanghai, Tianjin, Dalian, Hangzhou, Kunming and Xiamen. PRC airlines may also operate from Guangzhou and five other Chinese cities yet to be named. It is our intention to seek to negotiate, when opportunity presents itself, a more balanced regional route package which give Hong Kong airline(s) a more equitable share of market access and capacity.

2.

PRC AIRLINES THROUGH-RUNNING HONG KONG

Points to make:

Chinese side should be

aware that Hong Kong will have difficulties in granting

granting through-running by PRC airlines. Suggest that the matter be further discussed between the sides at the bilateral air services talks.

Background

At the earlier stage of the latest series of regional routes. negotiations, CAAC demanded the right to through-run Hong Kong to London, Australia, North America, Europe and S.E. Asia. То accede to such a demand would not only damage Hong Kong's aviation interests but would also undermine Hong Kong's autonomy in the field of civil aviation. Although in the event the Chinese did not press for through-running because they were anxious to resolve the more immediate question of multiple designation on the regional routes, it is clear that through- running remains one of the CAAC's main objectives.