CONFIDENT TAL
"as the responsibility of metropolitan powers" although he did qualify this by saying that this was the prevailing though not necessarily, the final Japanese line. It appeared from Mr. Otaka's reply that Mr. Endo had been carrying out the letter of his
instructions a little too accurately, rather than thinking the problem through. Mr. Otaka explained that it was true that in principle the dependent territories, being the responsibility of the metropolitan powers, were not considered by the Japanese to be eligible as beneficiaries under the scheme, At the same time, however, the Japanese Ministry of Foreign Affairs wanted to include as many developing countries or territories as possible in the scheme. There would, therefore, be increasingly a divergence between Japanese principle and practice over this problem but the Ministry of Foreign Affairs had been put on notice by the Ministry of Finance that it would be up to them to make the running over this problem. The MyFA were therefore urgently looking for ammunition. Hence the large amount of material which Mr. Endo had been trying to assemble in London on dependent territories and hence Mr. Otaka's request for further information about the :"customs organisation in each of the dependent territories
and the ability of those customs authorities to issue valid certificates or origin. Other points on which the Japanese had already sought information in London concerned the currency system in the territories, whether they were at least associate members of one United Nation's organ, and whether their foreign exchange balances were handled separately rather than as part of the general UK holdings. Mr. Otaka emphasised that he was looking for evidence rather than simple assertions- on these points. There seems therefore to be a great deal to be said for London preparing a suitably documented Aide Memoire on the dependent territories (see paragraph 3 of FCO telegram number 42 of 25 January). It was also clear from what Mr. Otaka said that the MyFA welcomed active lobbying as providing useful ammunition in discussion with other Japanese Ministries (the Australians over New Guinea and Papua and the Dutch over Sore and the Dutch Antilles have been particularly active apart from ourselves.
These
+
4 territories stand a good chance of being included in the Japanese offer as well as Hong Kong).
5. In response to a question Mr. Otaka then turned to : timing. The Bill on generalised preferences has now
been drafted and will be submitted to a Cabinet meeting on 2 February. It will not contain a list of béneficiaries but will set out in general terms the criteria for countries or territories to become beneficiaries. At the Cabinet meeting the Minister of Finance will make an oral presentation dealing with the i problem of beneficiaries. In particular he will refer
to the section of the draft Bill which reads in rough translation "of the territories which are at a developing stage and which have customs and trade systems of their own, those which desire to benefit from duty rates provided for in the preceding paragraphs may be designated in a Cabinet Order which would specify territories and products and may thus accordingly be given the 'benefit. After Cabinet
4+
/approval