M Ryle during
VISA
Tokyo.
hi
CONFIDENTIAL
As far as Japan was concerned, they felt that something "optical" would be sufficient like "including Hong Kong for jet aircraft". Fox said the U.S. might well be prepared to put pressure on Japan to do something in this direction. He asked in what sectors Hong Kong really worried about competition from Taiwan and Korea and I replied in electronics particularly but also in such items as wigs, dolls and toys and other electrical appliances. Fox commented that electronics was what worried the U.S. from the other end and I hinted that Hong Kong was prepared to face exclusion on a product by country basis provided that the same went for others who met the figures.
14.
This conversation I thought was a useful one and I will try to follow it up in Geneva.
Switzerland
15. The Swiss delegate, Staehlin, was the leading exponent in the Trade Committee of having out the issue of beneficiaries and getting it settled. He intimated that, providing other donors were also willing to agree, he would prefer following the self-election principle advocated by the Special Group in 1967. But he pointed out that, if other donors were not willing to follow this principle, they had to come clean on what they were prepared to do because this was a very important element in burden-sharing. If consideration of this issue was put off then it would be incompatible with the stated wish to have a completed GPS ready before the end of October for presentation to the UN Generel ssembly. The impression I gained from a short talk with Staehlin was that, if the major donors included Hong Kong, Switzerland would be prepared to do so as well. The same went for Willennart (Austria) who has always maintained that
A
Yugoslavia is a much bigger problem for Austria than is Hong Kong.
Conclusion
16. My conclusion from this is that for Hong Kong all may not yet be completely lost in the United States, but that time is running out fast. What my soundings revealed more clearly than ever is that the key lies with the EEC. The only hope now of moving the EEC, however, would appear to be very strong pressure applied at the highest, i.e. Ministerial, level, both with the Commission and with the Member States. In other words, I feel that only a personal intervention by Mr. Rippon stands any chance of shifting the Six. HMG could also at the same time maintain pressure on the Japanese to concede something to Hong Kong even if in practice it does not add up to anything very much. I do not know whether this will succeed because I feel that a major (unstated) reason for the Japanese determination to exclude Hong Kong is that what they really want is for Hong Kong to be excluded by the United States in order to reduce the competition for their own exports in the American market.
17.
Provided these actions are taken, a renewed approach might then be made in Washington. But the minimum necessary to get anywhere in this would be to point to some progress in shifting the EEC attitude.
18.
All this is predicated on the assumption that we still have a little time and (hopefully) that the real crunch will not come before the OECD Trade Committee meeting on 30 November/1 December. As part of our tactics we should try our best to see that no irrevocable passes are sold before that date, particularly in discussions in the UNCT^D.
DJCJ/mmg
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