DRAFT

MR DELL'S MEETING WITH GOVERNOR OF HONG KONG TUESDAY 27 SEPTEMBER 1977

Introduction

The main points which the Governor is likely to make are:

(i)

(ii)

(iii)

(iv)

The EEC proposals for cut-backs on Hong Kong trade go far beyond the

récent US/Hong Kong agreement which marks the limit to what Hong Kong

can accept (this provides for no overall growth in 1978 and 6% growth

in subsequent years);

Other importing countries who have concluded bilateral agreements with

Hong Kong under the present MFA (Canada, Sweden Norway) would expect

similar treatment if the EEC got its way. And the USA would review its

agreement; and

In any case the EEC proposals in themselves would be a severe blow to the

Hong Kong economy;

The UK would be held responsible for Cpolicy and might lose major

contracts.

Line to Take

1

2

-

Surprised at cut-backs in trade Member States have only just received

Commission proposals for the eight most sensitive products. working on proposals for other products

Commission still

The UK has not advocated trade-cut-backs in Brussels and has insisted

on fair treatment for Hong Kong. Note that other dominants will be

treated equally severely (Taiwan. South Korea)

شما

3

Proposals not yet agreed by Member States. But we would not hold up

progress in the bilaterals by standing out against trade cut-backs.

Importance of substantial improvements in the operation of the MFA for UK

1

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