Reference
(a). refuse to agree restraint unless Hong Kong has pre-empted the market or already established a strong position vis-a-vis third countries, and then only to agree to restraint in condition that there is an equity clause designed to stop other countries encroaching on her position;
(b)
to avoid a situation where Portugal might increase her share of the market at Ilong Kong's expense;
(c) to free herself from control by Whitehall because (i) this builds up the position of the local bureaucrats, (ii) the U.K. attitude on air landing rights, finance for the harbour tunnel, etc. is bitterly resented and (iii) as usual overseas, the comfortably off ex-patriates are mostly anti-British;
(a)
to make concessions on cotton items to buy time for increasing exports of man-made fibres, and then if possible to establish a single quota for, e.g., all shirts.
The Facts of the Casc
5. A year ago, on 7th June, the Secretary decided on the evidence, that the arguments were strongly in favour of advising Hong Kong to refuse to accept voluntary restrictions on m.m.f. garments to Sweden. At a further meeting, on 19th June, the Secretary decided that, on the basis of the German precedent, Hong Kong could
This offer to restrain exports of wool cardigans etc. to Norway. offer was accepted. It was then decided to make the same offer to Sweden as a douceur, but in the event we also conceded restraint on
This last item was m.m.f. cardigans, etc. and men's anoraks.
conceded although even the Swedes admitted that there was no case for restrictions which could be made out under Article XIX of the G.A.T.T. In February of this year these restraints were extended to cover women's anoraks (on the grounds that these were being substituted for men's anoraks) and men's wool (but not m.m.f.) sweaters.
6. The Swedes orginally asked for restraint to be imposed on imports of all garments. They eventually justified their request on the grounds that they had an election which the Government feared they would lose and Ir. Lange had personally committed himself to restraint. On this basis we agreed to buy off the request for restraint on non-cotton items by accepting restraint on a long list of cotton garments, even though the restraint could
Se wero double- not in most cases be justified under the L.T.A. crossed in this by Buron de Geer. We eventually agreed to restraint on two non-cotton items only as a political cop to the Swedes, who won the election handsomely, and not because anyone was convinced there was a case. The restrictions were intended to last only one year.
/7.