Paragraph 3 onwards revise to read:

3

In some instances, however, matters do not rest solely

in the hands of HMG. An example is our alignment on

1 January with the EEC Generalised System of Preferences

(GSP), which will involve discrimination against Hong Kong

over their textile and footwear exports. There was no

possibility of persuading our partners before 1 January to

agree to changes in the scheme to benefit Hong Kong; but at

a recent meeting of the Council of Ministers we put them

firmly on notice that we intend to press most resolutely

next year for improvements to benefit Hong Kong. We shall

do this even though it costs us something in Community

terms.

4

In the same spirit we are anxious to promote a

Community textile-trade policy whose effect over the next

few years should be to open up the markets of our more

restrictive European partners to increased textile imports

from countries such as Hong Kong. But we must be given

discretion to pick the most auspicious occasions and

tactics for pursuing this. We have also used some of our

slender credit with the Arabs, at Ministerial level, to

persuade them to make special arrangements to supply Hong

Kong with oil. The Prime Minister personally spoke to

Sheik Yamani about this. Perhaps most important of all,

at

some considerable cost to our relations with the Chinese,

we have given them no encouragement to pursue the proposal

of establishing a Chinese Representative in Hong Kong.

5

1

There is a further range of issues, where it may not

be altogether common knowledge, where HMG has gone to

Wico

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