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In Confidence
DRAFT
TELEGRAM
Type 1 +
From
To:-
IMMEDIATE
Telephone No. & Ext.
GOVERNOR, HONG KONG
Department
1
Essentielly,
wils.
20
Consultations with Sweden
Since receiving your report on the first round in
Hong Kong we have been considering how we might best
handle the Swedes next week, having regard to the
developing situation on the American front.
2.
On the one hand we fully recognise the importance
to Hong Kong in the present difficult situation of
securing the best deal possible from both the Swedes
and the Americans, We also share your concern about
the impact of import controls particularly since we
ourselves may come under pressure from UK industry to
impo se restrictions on imports of non-cottons from
Hong Kong
3. On the other hand-has long been the policy of
KMG to oppose any proposal likely to restrict the flow
உ
of trece. Our fear all along has been that political
or em nomic difficulties in one country might lead to
restrictions on trade of one kind or another which
would create damaging precedents for the erection of
further barriers elsewhere. That is why we attach so
much importance to GATT and why we think that our
approach to the Swedes must be so carefully studied.
4. With some misgivings we have new come to the
conclusion that habanae it would be better to agree
to selective restraints on a few non-cottons from
in hen
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We han howen
/ Hong Kong
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