CONFIDENTIAL
OTTAWA TELNO 18 TO HONG KONG
3
HONG KONG HAS BEEN READY TO ACT WITH RESTRAINT WHERE REAL CANADIAN DIFFICULTIES HAVE BEEN ESTABLISHED. THE OBJECT OF SUCH APPROACH WOULD BE TWO-FOLD. FIRST TO DISCOVER WHETHER THE D.N.R. ACTION IS PART OF A CONCERTED CANADIAN GOVERNMENT APPROACH TO THE LOW-COST IMPORT PROBLEM AND WHETHER D.N.R.RECOGNISE, AS I WOULD CONTEND, THAT HONG KONG'S DEMONSTRATED SENSE OF RESPONSIBILITY SHOULD PROVIDE HER WITH SOME IMMUNITY FROM THE ARBITRARY PROCESS OF ZEALOUS CUSTOMS OFFICIALS. SECONDLY TO SEEM TO CREATE THE MAXIMUM FLEXIBILITY IN CANADIAN MINDS IN CONSIDERING COUNTER-REPRESENTATIONS BY THE HONG KONG INDUSTRY AND TO DISCOURAGE ANY EXTENSION INTO OTHER FIELDS OF ARBITRARY VALUATION. DEPENDING ON THE OUTCOME OF ANY TALKS WITH HOWARTH (WITH WHOM WE HAVE A GOOD WORKING RELATIONSHIP) IT MIGHT BE WISE ALSO TO AQUAINT THE DEPARTMENT OF EXTERNAL AFFAIRS WITH THE FACTS AND CIRCUMSTANCES (WHO AS YOU WILL KNOW WERE ACCOMMODATING ON THE KORATRON DOUBLE RESTRICTION). \
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8. 1 RECOGNISE THAT, IN THE LAST ANALYSIS, I WOULD TEND TO BE ARGUING THAT IF THE CANADIANS WANT TO RESTRICT HONG KONG TRADE, THEY SHOULD APPROACH US WITH THEIR PROBLEM DIRECT AND NOT THROUGH THE MULTIFARIOUS DEVICES OF THEIR TARIFF. I SEE NO DANGER, RATHER SOME ADVANTAGE, TO YOUR POSITION IF I SPEAK TO HOWARTH (PERSONALLY AND WITHOUT INSTRUCTIONS) ON THE LINES SUGGESTED, BUT I WILL BE GUIDED BY YOUR VIEWS ON THIS POINT AND ON THE POINTS RAISED IN PARAGRAPH 6.
FCO PASS UKMIS GENEVA.
SIR C CROWE
[REPEATED AS REQUESTED]
INTERNATIONAL TRADE DISTRIBUTION
HONG KONG DEPT
N.A.C.D.
TRADE POLICY DEPT
COMMODITIES DEPT
CONFIDENTIAL