CONFIDENTIAL

dependency. At home we can point to the specific

promises to Hong Kong made by Mr Rippon in 1971, to

distinguish this case from other demands which were

not made at the time. Parliament expects the Government

to keep its word, and an approach on this point to the

Community is likely to get substantial support from both

parties. We can take the same line with the Indians

and others, while pointing out that the constitutional

position of a dependent territory is necessarily

different from their own.

Ther

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In hom

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8. The alternatives to trying to persuade the Community

to admit Hong Kong to its GSP on footwear and textiles

would be to propose that they should exclude these

categories from the Community's GSP altogether; or that

they should limit the damage by lowering the Butoirs (on these

categories; or that they should take the whole question

of textiles out of the GSF context and consider it in

the wider context of the Community's textiles policy.

The first of these possibilities would be contrary to

the policy laid down by the 1972 European Summit and

inconsistent with the conclusions of the GATT Ministerial

meeting in Tokyo; the second is open to the same objection

and would not meet Hong Kong's political requirements;

nor would the third, which anyway stands very little

chance of success, and would not solve the problem of

footwear.

9. I conclude that we must ask the Community to

Colton onj

extend its GSP textiles and

xtiles and footwear to Hong Kong.

We may not succeed in getting everything that Hong Kong

wants: For example it will be more difficult to argue

for f

the case for footwear, where the position of Hong Kong's

/major

(ie. Limits

within

the duty- hu

quotas which limit the benefits.

to any one country.)

cotton

no-

cotton textiles and

for

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(17259) Dd.897459 250m 12/72 G.W.B.Ltd. Gp.863

(16941) Dd.897300 250m 9/72 G.W.B.Ltd. Gp.863

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