IMMEDIATE

CYPHER CAT A

AND BY BAG

FFCO 1013007

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#ENT

kat.

DESKBY 101438 7

RESTRICTED

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2

1973

TO IMMEDIATE UKREP BRUSSELS TEL NO 31 OF 18 JANUARY INFO GOVERNOR HONG KONG' INFO SAVING BRUSSELS

YOUR TEL NO 67: COTTON TEXTILES,

1. WE DO NOT NECESSARILY AGREE THAT OUR LACK OF RESTRICTIONS ON KNITTED COTTONS AND OUR UNWILLINGNESS TO IMPOSE SUCH RESTRICTIONS LEAD INEVITABLY TO THE LINE PROPOSED IN YOUR PARAGRAPH 2, BUT IF IT IS EASTER FOR THE COMMÏssion TO SWALLOW THE INCOMPATIBILITY ON THIS BASIS, WE AGREE THAT OUR QUOTA LIMITS FOR COTTON YARN AND WOVEN COTTON GOODS COULD BE EXCLUDED ALTOGETHER FROM THE COVERAGE OF THE COMMUNITY'S ARTICLE 4 AGREEMENTS.

2. WE DO NOT AGREE HOWEVER THAT YOU SHOULD GO AS FAR AS SUGGESTED IN YOUR PARA. 3. RATHER THAN EXPRESSING THE INTENTION OF TAKING STEPS TO ELIMINATE THESE INCOMPATIBILITIES WHEN OUR AGREEMENTS. EXPIRE, WE SHOULD SAY THAT IN VIEW OF THE EXPIRY AT 9 SEPTEMBER OR 31 DECEMBER 1973 OF THE COMMUNITY'S AGREEMENTS (AND OF THE LTA ITSELF AT THE EARLIER DATE) WE INTEND TO PLAY AN ACTIVE PART DURING THE COMING MONTHS IN FORMULATING A NEW TEXTILE POLICY FOR THE ENLARGED COMMUNITY, NEW AGREEMENTS WITH SUPPLYING COUNTRIES TO REPLACE THE EXISTING UK AND EEC AGREEMENTS CAN ONLY BE CONSIDERED IN THE LIGHT OF SUCH A FOLICY, BUT SHOULD CLEARLY (IN OUR VIEW) DE ELABORATED AND NEGOTIATED BY THE COMMUNITY AS A WHOLE RATHER THAN

BY MEMBER STATES.

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COPIES TO

MISS LOWNE, CTD DTI

HONG KONG GOVT OFFICE

LONDON

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