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up to 1 January, 1972 when the tariff replaces quantitative
restrictions. We can expect Hong Kong then to seek some
assurances about our use of such restrictions after that date.
Hong Kong and EEC
12.
Hong Kong is also concerned about the future of its trade
in textiles with EEC countries now that the community is in
process of formulating a common commercial policy. The fear is
that members of the Six who follow liberal trade policies (like
Germany) may be compelled to adjust their policies to meet the
restrictionist attitudes of cther members (e.g. France). The
Six, apart from France, do not impose restrictions on non-cotton
textiles and only if a major exporter to the United States were
to concede restraint in this field does it seem likely that the
position would change. On cotton textiles, the Commission
bases its current position on the expectation that the LTA will
be renewed and it is currently engaged in discussions with the
Hong Kong Government on this basis. The indications are that
each Member State will continue to operate individual quotaz
for cotton textiles, within au overall EEC ceiling, at least
until the end of 1972.
13. Hong Kong have much more reason to fear the effect on
their position of our entry into the Common Market. The EEC
would almost certainly be unwilling to allow Britain to import
unlimited quantities of low-cost cloth for processing and free
circulation within the enlarged Community.
Hong Kong therefore
/foresees
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