from textiles, the vast majority of Hong Kong's exports to
our market, in any event involved loss of Commonwealth
surgens
preference for Hong Kong and the coverage of our own scheme
did not hinge upon the fact of UK entry.
(iv) The inclusion of Hong Kong in the EEC scheme was also
held to be of great importance by the Colony because of the
precedent it set for other major donors.
(v) Hong Kong officials will no doubt underline the lack
of generosity in the present Community's GSP scheme which is
reckoned to cover only some 14% of Hong Kong's present trade
with the Community and if applied on exactly the same basis
to nong Kong's trade with us it would cover about 20% of
her exports to the UK. The Prime Minister has recently
underlined the importance the Government attaches to persuading
our Community partners to improve the present scheme in the
interests of developing countries. Hong Kong can be assured
that in the discussions next year on the adjustments that will
have to be made in the present scheme to make it suitable for
a Community of ien, we will have regard to their views. But,
as realists, Hong Kong officials will recognise, as we do,
that it may not be easy to secure substantial improvements on
items which are subject to low ceilings in the present scheme
precisely because of the threat of Hong Kong competition.
More generally, our belief is that the stimulus to economic
expansion which membership will in time bring to the UK must be of
benefit to a major supplier like Hong Kong. The enlargement of the
Community should also mean that the justification for residual
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