CONFIDENTIAL
(c)
if this countrees were to exclude Taiwan and
(a)
Soul Korea, which were. Shong American interests, The USA,
!
two countries under reference did not
command widespread political support:
their ldc status had never been
'called in question,
Mr. Hannay pointed out the tactical
disadvantage in complicating the
separate EEC's study of Hong Kong with their
exercise on beneficiaries in general.
Spreading alarm about these countries
would cause yet more alarm about
Hong Kong's competitive power, and
the Chairman and other speakers poin-
ted out gively that Buch notion
would have negative effects for Hong
kong vie à
which was
after all Hong Kong's main prefer-
1
ences target, would be unlikely to include Houghtoup 4. With regard to (iii), Sir J. Cowperthwaite
suggested that Hong Kong should be excluled
only on those textiles items where she 'ejoyed
a large share of the EEC market, but Mr. Harney
pointed out that what progress had been achieved
so far was because of the attraction of a total
exclusion on textiles and shoes. Picking at
the edges of this proposal could well cause it
to fall apart altogether. Mr. Lam and Mr.
Denman stressed the EEC reluctance to get
involved in further complications on textiles.
The main objective was to get enough from the
5.
EEC to induce the Americans to follow suit.
As for the rider on (iii), the Hong Kong
proposal that textile exclusions might be rever-
sed in the light of evident damage (Hong Kong
officials quoted the example of the Australian
preference scheme, which allowed for such