be doubly handicapped if excluded by
other donor countries.
3.
We have the following observations on the
reasons which have been advanced in favour of
excluding Hong Kong:-
(a) Hong Kong is a territory and therefore
the responsibility of the metropolitan
power
(1) We regard the distinction between
"territories" and "countries" as
irrelevant in the context of
economic development.
(ii) There is no practical alternative
to Hong Kong's dependent status.
Hong Kong remins a dependant
territory for political reasons.
(iii) Hong Kong is a separate customs
area and derives no specific
advantage from the GATT as a
dependant territory. Her exist-
ing preferences in the UK will
disappear if the UK offer is
maintained.
(iv) According to an OECD document
published in 1967 (broadly
ร
endorsed by Ministers) "any
country, territory or area may
claim developing status"
•
(b) Hong Kong is not "developing"
(i) with the exception of a limited
range of manufactures, Hong Kong
is far closer to the concept of a
developing country than a
developed one.
*
CONFIDENTIAL
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