2
Beneficiaries
4.
Because of the difficulty of establishing any objective
criteria, the OECD countries broadly agreva in 1967 to accept the
principle of "self-election", by which any country with bona fide
claims to developing status would be eligible to benerit in all the
donors' markets. It has become clear, however, that most O2CD
countries are only prepared to uphold this principle with varying
reservations.
Line to Take
5. e continue to support the "self-election" principle, but we
shall need to take other donors' exclusions of beneficiaries into
account in order to maintain an equitable sharing of the burden.
We consider that dependent territories should not be excluded.
For your own information our main concern is that Hong Kong should
participate in the Scheme to the extent, at least, that her economy
will not suffer through her being totally excluded while her principal competitors (South Korea, Taiwan and Singapore) are included.
e consider that Hong Kong is no less entitled than they to be
considered "developing", and so eligible to benefit under the scheme.
Reverse Preferences
6. The United States' original position was that they could not
include in their offer developing countries which granted preferences to other donors (1.e. reverse preferences). They have since modified
this to the extent that they are now willing to include such countries,
provided they give an informal undertaking to phase out reverse
preferences. beginning in 1973. e and other developed countries
concerned (C, Canada, Australia and New Zealand) have argued that
this is primarily for the developing countries themselves to decide
and that it is unreasonable for the United states to make the
abolition of these preferences a condition of eligibility to benefit
from the United States scheme, which is much less extensive than the
CONFIDENTIAL
/Commonwealth