CONFIDENTIAL
Sir A. Snelling
39 модаштала
Hongong
By way of preparation for your meeting tamerrow morning on Hong Kong, I attach a copy of the Agreed Note on the talks between British and Hong Keng officials which took place earlier this month. Mr Selwyn has already commented on many of the points raised during the talks in his minute to you of 17 July.
2. is regarde paragraph 2 of the Agreed Note, I think that it is now common ground that consideration of (a) and (b) need be taken no further. In spite of the ingenious suggestions made in är Selwyn's minute, 1 myself feel that the proposal in (r) is likely to give rise to more difficulties
than it would resolve. I do not think that (g) is negotiable with the Six; and (h) also gives rise to considerable problems,
3.
This leaves (c), (d) and (e), all of which are variations on the thene of applying the common external tariff to Hong Kong exports. For the reasons given by Mr Selwyn i think that (c) which is what the liong Kong Delegation originally called a "passive attitude" - is the most attractive solution.
As regards paragraph 5 of the Agreeů Note, us aust now initiate a correspondence with a view to getting a definitive ruling from the Foreign Offion Legal Advisers about the effect of Hong Kong's righte under the GATT of our joining. I entirely agree then Mr Selwyn that when we come to discuss this question with Hong Kong officials again, we should take up with them the possibility of Hong Kong using her public authority purchases as a bargaining counter in defence of her GATT rights. Of course, two thirds of Hong Kong's exports to ùe are cotton textiles ardone kind or another. The Board of Trade have now begun work on a draft paper covering cotton textiles as a whole, including imports from India, Pakistan and Hong Kong. I have told them that we should like to sec this in draft before it is put into the Euro Committee; and they have taken note of my request.
(C, J. Zudland) 26 July, 1967