CONFIDENTIAL.
DRAFT SAVING DESPATCH
From the Secretary of State for Foreign and Commonwealth Affairs.
To the Governor, Hong Kong.
Your Saving Despatch No 28 of 8 January 1971.
Exports of cotton textiles to Britain: Post-1971 Arrangements.
1.
The meeting between your representatives and officials of the
United Kingdom Department of Trade and Industry and Foreign and
Commonwealth Office requested by you took placed in London on 1 February
1971. It was agreed that the matters discussed at that meeting should
be further considered by the UK Government before a reply was sent to your
Saving Despatch No 28. We are now in a position to reply to the points
which you raised.
2. We are grateful for the summary in paragraphs 3 to 6 of your Saving
Despatch of the findings of the Advisory Committee to the Hong Kong
Textiles Advisory Board on the likely effects of the United Kingdom's
new policy on imports of cotton textiles which is to be introduced on
1 January 1972. We note the Committee's references to the dependence
of some sections of the Hong Kong textile industry on the British market
and to their fears about the effect on their trade and profits of the
new tariff on imports of cotton textiles into the UK from the Commonwealth
Preference Area. We can appreciate this apprehension on behalf of the
particular firms concerned. But from the viewpoint of the industry as
a whole it perhaps ought to be balanced by a recognition of the oppor-
tunties that will exist in future for the industry to compete free of
quantitative restrictions in the UK market. We had earlier understood
that some sectors of the Hong Kong industry were looking forward to