HONG KONG CANADA
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My minute of Ceptember 3rd recorded the points which the Secretary had asked me to put to the Hong Kong represen- tatives after the meeting held in his room on that day.
My minute of September 4th recorded the reactions to the points made by lir, Jordan anû his colleagues.
The purpose of this minute is to record the final instalment of this chapter of events. During the afternoon of September 4th, the Secretary considered in sono detail the Hong Kong reactions in a series of interrupted meetingo at which Kr. Pock, Mr. Carey, Mr. Stewart and I were present for the whole or part of the time. The Secretary finally Lave guidance on what should be said and late yesterday evening I called in Mr. Jordan and Mr. Wilford (UO) to tell them the outcome, This was as follo%5.
We appreciated from the additional information given us by Er. Jordan why the Hong Kong Government would like to take the opportunity of Er. Howarth's presence there to conclude the negotiations with Canaan carly next week and we did not wish to object. We should normally have wished to be associated with the conduct of the talks but in this case it would not be practicablo for us to be represented. We were prepared to accept that the decision on a renewal of the restraint agreement with Canada and its cxtension to cover polyester/polynosic shirts should reat with the Hong Kong Goverment. But we would ask them to give very
full weight to the following points:-
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HKK6/31/1
(1) It was our view that restraints should only
be conceded when a situation had arisen such as one in which Article XIX of the GATT might otherwise have been invoked; or in other special circumstances, such as a threat of action prejudicial to Hong Kong's trading intereste. In the Canadian case, we were doubtful whether either of these criteria applied in the case of blouses and trousers. We believed, on the facts available to us, that there was a case for making an effort to end the restraints on these itens.
(11)
We were also concerned about the possible implications of the Hong Kong/Canuda restraint arrangements on the restraint situation between Canada and Japan, and we would like the Hong Kong Government to consider this point with
care.
Finally, when full information was available about the Norwegian case for continuing restraints we should wish to consider the extent of consultation and association which we might wish to exercise. We expected to be represented at the talks with the Norwegians.
Mr. Jordan was clearly content with what I had told him and he did not, as I had expected, press me to agree that Hong Kong now had full and unfettered freedom of action to conclude voluntary restraint arrangements with other countries
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