CONFIDENTIAL

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13. The third round with Hong Kong took place in mid-November, in preparation for the Council of Ministers Meeting on 22/23 November. On this occasion Britain supported

the revised Commission proposal for flexibility inside the "global ceilings", using the reserve left over from other negotiations. This has eventually led to cut-backs of 7.6% for Hong Kong after the Council of Ministers authorised the Commission to negotiate with the "dominant" suppliers on the new

basis. Britain's position, taking Hong Kong's interests

into account within the limits available, was noted in the

British press.

The Minister for Trade (Mr Rees) also sent the Governor a personal telegram about Britain's part in the negotiations (Annex D).

Hong Kong and General Department

December 1982

CONFIDENTIAL

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