CONFIDENTIAL
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CONTRACTS WITH BUYERS IN CANADA (ESPECIALLY THE BIG DEPARTMENT STORES AND MAIL ORDER HOUSES) WHICH NORMALLY COVER A MUCH LONGER PERIOD. IN THIS CONNECTION SEE ALSO PARA 4(B) OF MY TELEGRAM 475 WHEN A SIMILAR SUGGESTION WAS MADE IN RELATION TO SWEDEN. IT WAS ABANDONED AFTER THE DIFFICULTIES HAD BEEN EXPLAINED IN THE JUNE MEETINGS AT THE BOT. SECONDLY, ON (B) IN YOUR PARA. 3, THE POSITION FOLLOWING THE NOTICE TO EXPORTERS YOU QUOTE IS THAT CONTRACTS FOR OVER 91,009 DOZEN POLYESTER/ POLYNOSIC SHIRTS HAVE BEEN REGISTERED, ON TOP OF THE APPROX. 60,000 DOZEN ALREADY SHIPPED SINCE 1 OCTOBER 1968, AND THAT EXPORTERS REMAIN FREE TO SHIP THESE BEFORE 30 SEPTEMBER. IN VIEW OF THE QUANTITIES INVOLVED I DOUBT IF THE CANADIANS WILL ACCEPT THAT SHIPMENTS MAY CONTINUE AS LONG AS THIS
11. PARA. 2(B) IN YOUR TELEGRAM 536 AND THE POINTS MADE IN PARA. 2 OF YOUR 537 REST VERY LARGELY ON A MISINTERPRETATION OF THE FIGURES, WHICH I EXPLAIN IN MY TELEGRAM 648. IN ANY CASE YOU MAY BE ASSURED THAT THE QUESTION OF EQUITY VIS-A-VIS
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OTHER SUPPLIERS IS ALWAYS A POINT WHICH HONG KONG PROBES MOST CAREFULLY IN ANY NEGOTIATION AND WE WOULD NOT FAIL TO DO SO THIS
TIME. YOU WILL RECALL THAT THE CONCLUSION REACHED IN THE PAPER TEXTAB INF/5/69 ON CANADIAN RESTRAINT AGREEMENTS WITH THIRD COUNTRIES (OF WHICH YOU HAVE A COPY) IS THAT HONG KONG
HAS NOT BEEN TREATED WORSE THAN OTHER COUNTRIES IN RESTRAINT ARRANG-
EMENTS SO FAR.
12.
I HOPE YOU WILL AGREE, IN THE LIGHT OF THE COMMENTS ABOVE AND THE EXPLANATION OF THE FIGURES IN MY TELEGRAM 648, THAT NO MAJOR ISSE
OF PRINCIPLE WOULD BE COMPROMISED BY OUR GOING AHEAD WITH THE
NEGOTATIONS FOR A 12-MONTH EXTENSION OF RESTRAINTS, IF NECESSARY
ON AN AD REFERENDUM BASIS. THE CONCLUSIONS COULD THEN, IF NECESSARY,
BE REVIEWED WHEN HUGHES VISITS OTTAWA ON 22 SEPTEMBER AND
IN THIS CONNECTION I AM GRATEFUL FOR YOUR OFFER THAT A HONG KONG
REPRESENTATIVE MIGHT ATTEND THESE TALKS.
13.
*
KONG
I SHOULD ADD THAT, IN VIEW OF THE LAST TWO SENTENCES
CONFIDENTIAL
/OF PARA.10