24+25
2 -
in trade
Although this involved a severe reduction opportunities, Hong Kong made clear it was ready to accept this.
The EEC demanded further cuts of Hong Kong and one or two other developing countries. These cuts were said to be required in order to give quota to other countries, allegedly those less developed than Hong Kong. The full extent of this attempted redistribution of trade has not yet been revealed but Some of the beneficiaries are not among the poorest of developing countries nor
is any of these other suppliers as heavily dependent as Hong Kong on textiles and clothing exports. The redistribution of Hong Kong's quotas seems to have been made for political not economic reasons.
Its
This arbitrary redistribution involves a principle not provided for in the existing world trading system. effect is to redistribute trading opportunities from the more advanced among the developing countries to the less advanced while the trade of the developed countries USA, EFTA and Japan for instance is left free to expand at will. The exports which Hong Kong cannot now ship will be replaced by those from rich countries with the production capacity to make the quality of goods demanded by the European consumer, and not by the so-called "small suppliers and newcomers" who either do not have the required production capacity or cannot meet the required quality.
Hong Kong initialled this harsh agreement because it was threatened with even more damaging unilateral action by the EEC if it did not do So. Hong Kong's other developed trading partners will now probably attempt to emulate the EEC. Sweden and Norway have already sought cutbacks of up to 70 per cent on Hong Kong's textile exports to Scandinavia.
Hong Kong has a reputation for versatility and industry. It will now seek to minimise the effects ОЁ the harsh terms it has received from the EEC. This will mean the development of new industries and new markets, but if success in making things people want to buy is penalised in the way the textile and clothing industry of Hong Kong has been, it is difficult to see how versatility and industry alone will be enough.
For further information please ring the Commissioner, Denis Bray, or the Assistant Commissioner (Commercial) Steuart Webb-Johnson