"
CODE 18-77
Mr Morris
SECRET
very useful w/ 1318
Hong Kong & General Dept.
HONG KONG STUDY
1.
Carlo
Reference..
M. Donald
HICK040/3
RECEIVED IN MELISTIN
7
2
1984
C1672!
As I mentioned when we spoke on the telephone I have now sounded out ERD on Hong Kong's status in UNCTAD and in commodity agreements. So far as the body of the paper was concerned we agreed that the material in John Meadway's letter of 6 August was an invaluable contribution. For what it is worth I have tried my hand at working this into a revised version of the outline Trade Annex which I now attach.
2. As you will see I have added material on the PRC's present practice and status where appropriate. Subject to your views I think it would be positively helpful to point out the very sub- stantial differences which exist, if only to forestall any Chinese claims that they would be able to 'godfather' Hong Kong in the GATT system just as well as the UK does.
3.
Even so it is impossible (and probably undesirable) to cover everything. One potential pitfall that has come to my notice is that the MFA provides for acceptance by 'Governments Contracting Parties to the GATT'. It would be typical of the pragmatic way the GATT operates for no-one to make a fuss over Hong Kong remaining a member even if its administration could not be described as a government because of PRC objections. Indeed there would be some anxiety to bend the rules to accommodate Hong Kong since the MFA would lose a lot of its value should the leading exporting country be excluded. It seems to me that only the PRC might raise objections but I hope that if they pick up this point they could be persuaded to turn a blind eye.
4.
In case anyone expresses interest in seeing the relevant texts I enclose copies of GATT Article XXVI, MFA Article 13 and the EC/China Agreement.
12 August 1982
Brücher
R Kinchen
European Community Department (External)
Ell1 233-3319
cc: Mr Rushford, Deputy Legal Adviser
Miss Brimelow, ITP DOT
Mr Muir, OT4 DOT
Mr Crabtree, ERD
SECRET