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As regards sheepmeat, Iraq had previously been a good market but was ceasing to be so. 100,000 tonnes of lamb had been sold this year to Iran. Under New Zealand's Voluntary Restraint Arrangement with the EC, 245,500 tonnes were sold to European countries. Commission were now suggesting that the agreement be renegotiated to lower the import level and to impose a minimum import price. But if the minimum import price was set at too high a level, European consumers would look elsewhere.
Mr. Cooper congratulated the Prime Minister on her first Administration, the success of the Falklands campaign and her re-election. He also brought greetings from Mr. Muldoon. The Prime Minister said that she looked forward to seeing Mr. Muldoon in Delhi.
Mr. Cooper then raised the question of Hong Kong whence the New Zealand Minister of Justice had just returned. He wondered whether in the present circumstances Hong Kong capital might move to Taiwan and whether in turn that might make China more disposed to agree on reasonable arrangements for the future. The Prime Minister said that we should be having an important round of talks with the Chinese later this month. We should have a better idea of the prospects after that.
At the end of the discussion the Prime Minister referred to the Glenbrook Steel Plant Contract. Davy's bid provided for a large measure of New Zealand content. Mr. Cooper said that he had looked at this in some detail and, for the Prime Minister's confidential information, could tell her that there was a gap between the two bidders of something like 100 million dollars. Work was being done to reduce the gap but clearly, while it remained anything like this size, it would be very difficult to decide in favour of the British firm. New Zealand would certainly like to help because of Britain's consistent support in the European Community but with a gap of this size it was not possible to do so. He stressed that this was confidential information which had not been given to the firms concerned.
I am copying this letter to Callum McCarthy (Department of Trade and Industry) and Robert Lowson (Ministry of Agriculture, Fisheries and Food).
Your
Lola Coles.
John Holmes, Esq.,
Foreign and Commonwealth Office.
CONNDENTIAL