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that she will be accepted as a beneficiary under such
arrangements. Virtually all exports from Hong Kong are
industrial goods. But it is already clear that the EEC are not prepared to treat Hong Kong under the preferential arrangements in the same way as other claimants to
developing status. There have been numerous informal discussions with Commission representatives intended to explore the possibility of conferring some preferential benefits on Hong Kong's trade, while taking account of the
reluctance of some members of the EEC to see their
industries exposed to duty-free competition from Hong Kong. Representatives of the Hong Kong Government have been party
to many of these informal discussions. We have made it
clear that we shall claim beneficiary status for Hong Kong.
It is impossible at this point of time to be certain of
the fate of Hong Kong and other borderline claimants to
beneficiary status in any final arrangements, but it is
only realistic to recognise that Hong Kong is unlikely to
get more than token preferences out of the EEC.
440 Even worse from her point of view, the Commission are
in the early stages of trying to work out a common
commercial policy towards Hong Kong. From discussion so
far this seems likely to take the form of extension of at
least some of the illegal restrictions maintained by France
on Hong Kong's exports to all members of the Community.
Both we and representatives of the Hong Kong Government have
made it clear that we would regard any such extension as
completely contrary to GATT. Nevertheless, if the EEC
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/persist