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2. Mr. Jordan said that the situation in Hong Kong
was extremely serious. H.M.G.'s recent instructions to
the Governor had brought the situation to a head as the
reaction of the TAB and EXCO showed. The TAB had asked
for a definition of the position regarding delegation of authority to the Hong Kong Government. Hong Kong was wholly dependent on trade which amounted to £1,600 m. in 1968. Their textile exports wore about equal to those of the United Kingdom, but relatively textile exports were of much greater importance to Hong Kong.
On
3. As regards the constitutional position a great deal of authority had in recent years been delegated to the Governor. There had been no specific delegation from London on external commercial relations in the immediatc past. It was not a
question of exercise of positive authority by the U.K.; but
there was a power of disallowance although this had not been exercised for many years. The policy trend had been to delegate more authority to the Hong Kong Government. cotton, although there had been no formal delegation of authority, the Ilong Kong Government had in fact negotiated with a number of countrics. Outside cotton, the first case had been that of woollen goods to Germany. He referred to Board of Trade telegram to Washington CREDA 267 of December 1965 which said that the Board of Trade did not preclude continuance of voluntary restraint agreements especially where they had been in existence for some time and that Hong Kong would be ill-advised to discontinue voluntary restraint with Germany. A telegram fromthe Secretary of State to the Governor expressed the opinion that IIong Kong would be unwise to press for action under Article XIX. Mr. Jordan said that these exchanges showed that at that time the Colonial Office and the Board of Trade took a different attitude on the question of voluntary restraints from that now adopted and, secondly, that the Hong Kong
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