CONFIDENTIAL

(a) In the same way as they treat

any other supplier of such

textiles and

(b) In the same way as any other

importer of such textiles

treats imports from Hong Kong

following restraints conceded by

Hong Kong.

Her Majesty's Government will, of course

act in respect of Hong Kong only in

accordance with their normal liberal trading

policies and GATT principles.

8.

Should problems of overseas trade

relations arise in commodities other than

textiles, the Hong Kong Government will be

free to follow the same general policies,

mutatis mutandis, as are proposed for

textiles in this despatch.

9. Because of Her Majesty's Government's

responsibility for Hong Kong's international

I shall requve

trading_relations, the Government of Hong

Kong will keep Her Majesty's Government

informed about prospective and current

negotiations on commodities matters with

Commonwealth and foreign countries. Moreover,

in view of the constitutional position Her

Majesty's Government must reserve their

rights in respect of any action the Government

of Hong Kong may propose to take within

the terms of this delegation of authority.

But Her Majesty's Government will not

normally expect to intervene, and if on

occasion it is proposed that a policy should

be followed by Hong Kong with which the

Government of Hong Kong disagree, the rights

of Her Majesty's Government will be

NOTHING TO BE WRITTEN IN THIS MARGIN

/exercised...

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