-8-

white washing exercise and we must accept that even in trade terms

it is bad also in that our future potential for trade has been

reduced in those categories where the bulk of our trade lies. In

other words, because 1977 was not a good year for Hong Kong's textile

exports to the Community, the immediate effect on trade is small,

but our export opportunities for the future, if and when demand

should revive, have been considerably reduced.

Nonetheless those long weary weeks in Brussels were not

wasted. The terms of the Agreement we brought home were a good

deal better than what the Community was originally seeking from us.

It might also provide a measure of sorts if I made a few

3 comparisons with the agreement negotiated with the United States last

July.

This

Included in the EEC's original demands were restraints

on fibres other than cotton, wool and man-made fibre, such as flax.

They started with about 140 categories and we finished up with 41

categories with specific limits and no overall limit and with the

restraints covering only cotton, wool and man-made fibre.

coverage is still wider than the present agreement with the Community,

which has only 24 categories, but it is a marked improvement on their

original proposals. It compares quite favourable on broad terms

with the 37 limits we have in the US Agreement, and that Agreement

includes an overall limit and individual group limits. The expansion

of 24 categories to 41 of course reduces the flexibility that our

manufacturers and traders enjoy under the present Agreement but even

so this still compares quite favourably with the US Agreement

/un

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