CONFIDENTIAL

HONG KONG TELEGRAM NO. 794 TO FCO

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9. A NEW ISSUE OF PRINCIPLE WOULD THEREFORE DE INVOLVED.

10. IN THE LIGHT OF THE FOREGOING, THE H.K. GOVERNMENT SEES

NO GOOD GROUNDS AT THIS TIME FOR THE DEROGATION FROM ITS GATT

RIGHTS THAT WOULD BE IMPLIED BY ACCEPTANCE OF THE U.S. GOVERNMENT'S

PROPOSAL TO ENTER INTO NEGOTIATIONS FOR A COMPREHENSIVE BILATERAL

AGREEMENT ON MAN-MADE AND WOOLLEN FIBRE TEXTILES.

11. HOWEVER, THE H.K. GOVERNMENT IS ALWAYS PREPARED TO ENTER

INTO CONSULTATIONS ON REQUEST BY ANY CONTRACTING PARTY TO THE

GATT, IN ACCORDANCE WITH ITS OBLIGATION, UNDER ARTICLE XX!!

OF THE GATT, TO GIVE SYMPATHETIC CONSIDERATION TO''''SUCH

REPRESENTATIONS AS MAY BE MADE BY ANOTHER CONTRACTING PARTY WITH

RESPECT TO ANY MATTER AFFECTING THE OPERATION OF THE GENERAL

AGREEMENT''

12.IN PARTICULAR THE HONG KONG (GP OMIT. ?GOVT.IS PREPARED TO ENKER INTO SUCH

CONSULTATIONS WHERE INCREASING IMPORTS FROM HONG KONG OF PARTICULAR

NON-COTTON-TEXTILES OR GARMENT ITEMS ARE CAUSING OR THREATENING

SERIOUS INJURY TO DOMESTIC PRODUCERS OF THE LIKE OR DIRECTLY

COMPETITIVE PRODUCTS.

13. CONSEQUENTLY, WHILE IN THE LIGHT OF PARAGRAPH 11, THE H.K.

GOVERNMENT IS, OF COURSE, PREPARED TO RESUME THE EARLIER INFORMAL

DISCUSSIONS OF THE GENERAL SITUATION, IT BELIEVES THAT IT WOULD

BE MORE APPROPRIATE IF SUCH DISCUSSIONS WERE RELATED TO ANY

PARTICULAR MAN-MADE OR WOOLLEN FIBRE PRODUCTS THAT THE U.S.

GOVERNMENT BELIEVES TO BE CAUSING OR THREATENING TO CAUSE

/SERIOUS

CONFIDENTIAL

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