Reference
SECRETARY OF STATE FOR TRADE OFFICE MINUTE NO: 1613
Mr Roberts
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PS/Secretary Mr Steele Mr Ashwood
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SECRETARY OF STATE'S MEETING WITH THE GOVERNOR OF HONG KONG
You were present when the Governor, accompanied by Mr Haddon-Cave, called on the Secretary of State on Friday 10 January 1976.
December
The Governor suggested that the Secretary of State might consider including a visit to Hong Kong within his 1977 programme;
such
a visit would fit in well with the work at present in hand in the colony to identify ways of increasing British exports. The Secretary of State reacted favourably to the suggestion but explained the difficulties of making extended visits in the current Parliamentary situation.
On the subject of British exports to Hong Kong, the Secretary of State expressed concern that the UK's deficit should be so large and persistent. He recognised that strong trading links had been developed with Japan. It might be difficult for British exporters now to break those ties. It was, however, a matter of importance to both sides that the economic ties between Britain and the colony should be maintained. He hoped that the benefit of these was recognised by all those who prospered through Hong Kong's special position. In reply, the Governor said that the importance of the link was widely recognised. Hong Kong bought large quanti- ties of raw materials from Japan but Hong Kong businessmen never regarded themselves as being tied to a particular source. There was a new opportunity for British suppliers following the depre- ciation of the £. Provided that British supplies matched Japanese in price and quality, there was no reason why they should not be preferred. Those British companies which had taken the trouble to establish good contacts with customers in the colony had done well. The key was to maintain sufficient stocks in order to reduce delivery times. In reply to a question from the Secretary of State, the Governor thought that there was a good chance that the order for equipment for a new power station would be given to a British company. The purchasers were a private Hong Kong company who had consistently bought British equipment and had been prepared to give a margin of preference over competing Japanese tenders.
In relation to the Working Group, it was explained that it would probably need 15 months before any results emerged. Their main task would be to identify product areas where. greater efforts should be made. They would no doubt also consider the need for new agency arrangements and would probably examine how UK firms could best be encouraged to tackle the market. It was agreed that the Working Group should help to make the private sector more aware of the importance of maintaining a vigorous trading relationship between the UK and Hong Kong. The best way, however, of publicising the quality and competitiveness of British goods was by example as in the recent successful MTA contract. This had been won by