HONG KONG

CONFIDENTIAL

Governor,

Hong Kong.

GOVERNOR, HONG KONG

Following is text of draft despatch.

Begins.

I have the honour to refer to the question of relations between Her Majesty's Government and the

Government of Hong Kong in the matter of trade in textiles. For some years now it has been clear that the interests of Hong Kong as a major exporter of

textiles, both cotten and non-cotton, are not

necessarily the same as those of the United Kingdom

whom although herself a substantial exporter, is primarily a major importer and domestic producer of such goods.

2.

Relations in the field of cotton textiles have

evolved gradually over the years and cottons as such no longer present problems. I have now decided that it would be in the interests of both the United

Kingdom and Hong Kong if the Government of Hong Kong were to exercise the same degree of independence of

action on non-cotton textiles as at present on cotton textiles; and I hereby give you authority to act

within the terms of this despatch.

3.

Relations between Her Majesty's Government and

/the Government

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