17.
11. The EEC have not stated what definition of beneficiary
countries they have adopted but it appears that for the time
being at least they envisage all the members of the "Group of
77". They have not specifically excluded Hong Kong at this
stage but are understood to be trying to find a solution to
the problem posed by Hong Kong's competitiveness on certain
products and to be thinking in terms of some voluntary restraints.
It is not yet quite clear what the statistical basis will be for
the calculation of the quota ceilings. It appears that for the
purpose of calculating the basic amount they will classify as
developing all members of the Group of 77 but excluding Hong Kong,
the African associated states, Morocco and Tunisia. Greece and
Turkey which are also associated with the Community will
presumably also be excluded from the total. For the purpose
of calculating the 5% supplementary amount the community will
take total imports from all other countries but will exclude
internal trade between the six member states. The supplementary
amount will therefore essentially consist of 5% of the total
imports into the EEC from North America, EFTA (less possibly
Portugal if it achieves acceptance as a beneficiary country),
the Sino-Soviet blocs, Japan, Australasia and South Africa.
The views of British industry and the Commonwealth
12. No formal consultations have been held with domestic
industry in general but discussions with the CBI, whose overseas
policy committee has considered the question, and with one or
two trade associations (the Chemical Industries Association and
the Derby Group) have indicated that the anxieties that industry
has about disruption from duty free imports and about balancing
our preferences with those of the other major donors would
largely be met by adopting the duty quota system.
It appears
that they would be likely to prefer this system to piecemeal
modifications of our offers even with a large number of
./exceptions