CONFIDENTIAL
SECRETARY OF STATE'S VISIT TO HONG KONG
FEBRUARY 1972
DEVELOPMENTS IN WORLD TRADING SYSTEMS
AND THEIR EFFECT ON HONG KONG
Brief No 6
International Trade Prospects
1. With the international monetary settlement, and the abolition of
the US import surcharge and the "Buy American" provision in the US
job development tax credit scheme, the threat of a descent into
protectionist warfare between the developed countries has been staved
Through her "voluntary" restraint agreement on non-cotton
textiles with the US, Hong Kong has played a significant part in the
defusing of the situation.
off.
2. The bilateral trade negotiations on outstanding short term issues
between the US on the one hand and the EEC, Japan and Canada on the
other have been predictably tough. But there are grounds for optimism
that enough progress will prove to have been made to enable the US
Administration to present to Congress the Bill to give formal effect
to the devaluation of the dollar.
3. Under the procedure for consultation during the interim period,
we gave our assent to the Community's negotiating mandate, and have
been consulted at each stage of these negotiations. We also supported
and welcomed the Community's Declaration of Intent, prior to the
opening of the negotiations, in which they proclaimed their willingness
to take part in global trade negotiations and their conviction of the
need for an overall examination of the structure of the world economy
and of the conditions for a new equilibrium at international level
/which
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CONFIDENTIAL