2
х?
Y?
The Prime Minister agreed that there was heavy
pressure on the U.S. Administration.
llo thought that
President Nixon himself was not protectionist by nature
and wanted to follow a liberal policy. He was relieved
to hear that Mr. Sato was going to speak to the President
again and he hoped that the problem could be resolved.
Mr. Sato commented that he could not promise that the
problem would be resolved but he would certainly do his
best. It was a case where progress depended on mutual
concessions.
The Prime Minister referred to the British
Government's wish to broaden Anglo/Japanese trade and
particularly the problem of whisky and woollen goods.
Mr. Sato replied that he hoped that import liberalisation
would be accomplished by the end of the year. Tariff
reductions would take a little longer because of the need
to put measures through the Diet.
The Prime Minister raised the question of Hong Kong.
He said that we felt strongly that long Kong should be
included in the generalised preference scheme. Hong Kong's
position was not different from that of Korea and Taiwan.
Ile hoped that Japan would look sympathetically at the
problem.
Mr. Sato said that this was a very difficult matter
for them largely because of Hong Kong's tariff arrangements.
Ile also referred to the fact that the Japanese yen was
freely used in Hong Kong and the yen conversion rate in
Hong Kong affected Japanese trade. There were also cases
where Japanese products were sold in third markets disguised
as Ilong Kong goods. This could be to Japan's disadvantage
when they were calculated against the total permitted
level of Japanese imports.
CONFIDENTIAL