CONFIDENTIAL
Reference...
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Mr. Jordan said that if HMG insisted on taking the final decisions on the non-cotton restraints Hong Kong could negotiate, the colony's government would be placed in an impossible political position with the Hong Kong Executive Council and the TAB. TAB might well resign en masse; they would insist on making a public issue of the matter, whereupon the communists would be able to convince much of the population that HMG were controlling Hong Kong's trade in the interest of the U.K. As Mr. Wilford said, serious issues of foreign policy would then arise. Mr. Jones said that the British position in Hong Kong would be threatened.
7.
The Secretary said that any suggestion that HMG were controlling Hong Kong's trade in the U.K.'s interest would be quite wrong. Nevertheless, it was clear that the Board of Trade and the FCO and Hong Kong representatives must reach agreement on the text of a statement to be made to the TAB. It would include a passage on the constitutional limits within which the Hong Kong government conducts its commercial negotiations; Mr. Wilford and Mr. Jordan would give further consideration to a Hong Kong draft on this point which the Board of Trade had not yet seen.
S.
The Secretary said further that Hong Kong's views on the commercial policy issue were entirely understood in London, and would be fully taken into account by Ministers in the forthcoming review of non-cotton textile policy which they were bound to conduct. As Mr. Jordan confirmed, they were that whatever the merits (of which they themselves were doubtful) of an Article XIX solution for non-cotton textiles generally, it would take time to implement it; that in the meanwhile Hong Kong should be free to renew her voluntary restraint arrangements and negotiate extensions of them if necessary, though in their negotiations they would take account of any advice received from London; and that they could do so without prejudice either to the possible adoption by HMG of an Article XIX policy or to the opposition to the U.S. proposal to extend the LTA to non-cotton textiles.
9.
The Secretary also said that IMG should hold effective consultations with Hong Kong after the Ministerial decision and before Mr. Hughes' negotiations in Ottawa on 20th-22nd September, at which Hong Kong would be represented.
10.
Mr. 'Jordan said that unless he could tell the TAB next week that HMG had authorised the Hong Kong government to negotiate with the Canadians a continuation of the existing voluntary restraint on polyester-cotton garments, and its extension to polyester/ polynosic shirts if necessary, the TAB would insist on making the matter public, and the serious consequences he had already described would follow. If the Secretary were to tell him that the negotiations could be authorised only after the forthcoming Ministerial discussion, and depending on the outcome of it, then he would feel obliged to inform the Governor at once.
11. The Secretary said that the Board of Trade would consider the matter urgently. The meeting was adjourned until today.
MR. DUNNETT (CRE1)
c.c. Mr. Hughes (Sec.)o.r.
Mr. Peck (Sec.)
Mr. Sanders (CRE2)
Mr. Carey (I.1.)o.r.
Mr. Denman (G.1.)
Mr. Goldsmith (CRE1)o.r.
Mr. Stewart (I.1.)
Mr. Jupp (I.1.)o.r.
Mr. Pryke (I.1.)
سخنه
(R. H. S. WELLS)
Secretariat
29th August 1969
Mr. Wilford (FC0) Mr. Carter (FCO)
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