Mr. McKelvie

Mr. Hurden

CONFIDENTIAL

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Generalised Preferences and Hong Kong

I asked Mr. Kemmis of the Board of Trade for some fuller explanation of the meaning of paragraph 6(ii) of UKDEL ÖECT telegram no. 58 saving, which seemed to imply that the self-election principle had been generally accepted.

2. Mr. Kemmis said that the position was reasonably satisfactory. No one at the meeting of the Ad Hoc Group had challenged statements by the U.K. American and Scandinavian Delegations that self-election was the only way to proceed, though reservations had been expressed by some countries about Rumania. There had been no discussion about Hong Kong as such, though the U.K. Delegation said they considered that dependent territories were equally eligible with independent countries.

3. There had, however, been developments behind the scenes about Hong Kong. It looked as though the U.S.A. would want to deal with the Hong Kong problem either on the basis of "competitive need" or by means of duty quotas. The EEC were considering counter proposals made by Mr. Jones to the position recently adopted by the EEC. Mr. Kemmis and Mr. Jones had also argued the Hong Kong case with the Germans and French and had made some impression, at least, on the Germans.

4.

Mr. Kemmis will be preparing a note on all this for Mr. Goldsmith and will send us a copy.

Copy to :-

Mr. Carter.

(R. G. BRITTEN) Trade Policy Department

1 October, 1969

CONFIDENTIAL

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