(HKK 6/331/1)
88)
Mr. Wilford
Hong Kong telegrams 659 to 662 are all concerned with the progress of textile negotiations with Canada. So far as the Canadian side of the actual negotiations are concerned they go no further than to
report the statement which the Canadians made, presumably at the beginning of, the resumed meeting on Tuesday, 19 August.
In summary important developments have been these:-
apparenies
(1) The Canadian delegation did not report to Ottawa for instructions on how to deal with the new situation they found when they got to Hong Kong. Having said that they were placed in a difficult position by Hong Kong's inability to settle
over MMF items they seemed to be extracting the maximum tacti- cal advantage from their declared intention to go for a
"package" deal covering cotton and non-cotton. However, they do not refuse to negotiate the cotton items (and presumably discussion continues accordingly). In effect they warn that any previous indications they had given of the levels at which
they were prepared to settle MMF items must now be ad referen- dum to Ottawa, While they guard themselves against Hong Kong succeeding over negotiating improved cotton levels by saying that any improvement on their first cotton level will also have to be ad referendum Ottawa.
Finally they ask for a definitive statement "in the near future" of the extent of Hong Kong's negotiating authority in matters of export restraint.
(2) The Textile Advisory Board has met and reacted as indig- nantly as we expected. They too want to know where the Hong Kong Government stands with regard to authority to conduct textile negotiations and have said that if they get no satis- factory reply from HMG within 10-14 days they will have to publicise the matter to the Trade Associations. They demand to be kept in the picture over the progress of the negotiations.
that (3) Unofficial members of ExCo have asked for their grave con- cern that Hong Kong's trade has been put in immediate jeopardy
/ should
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