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MISS LOWNE CT1

CON FIDENTIAL

ocr Lam CRE1

Mr Abramson CRE3 Kr right CRE Mr Gwinnell CT2 Mr Hope CT1 Mr Pownall CT1 Mr Stuart FCO Mr Hazle

FCO

EEC/HONG KONG

I understand that Hong Kong is now unlikely to take steps before to-morrow's meeting in Brussells unilaterally to restrain certain exports to the Netherlands, and that there is also some uncertainty about what we told Mr Jones and r Sellars on 12 March about the UK position at the meeting.

2 Unless anybody disagrees, our position at to-morrow's meeting should be:

A

&.

b.

c.

we will agree to give the Commission a mandate to negotiate with Hong Kong for restraints on exports of specific non-cotton textiles which are causing disruption in particular markets. With such a mandate the Commission could start talking to Hong Kong about any letherlands' problems immediately;

we would have no objection to the mandate also putting on to a Community-wide basis any restraints on specific non-cotton textiles which already exist in all 9 Member countries;

we will not, repeat not, agree to a mandate which either provides for the extension to all Member

countries of restraints which arrently aply only in some or requires the automatic application in all Member countries

of new restraints which may be negotiated because problems exist in certain countries. R

3 I recognise that, without a helpful Hong Kong gesture towards the Netherlands, the foregoing line, though not inequitable for the Dutch unless the Commission or other Member countrics continue to insist for a Community approach or nothing, will not be popular or easy. But to give way would mean conceding the fundamental principle of selectivity for products and markets.

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