D A Warren Esq FCO
- 2
-
8 October 1986
by the same token, of subsidisation. McDonnell clearly foresees some kind of EC/US/Japan/China agreement on this which would leave the way open for China to adhere to the GATT anti-dumping and subsidies codes. I should stress that this will not put an end to Chinese dumping. McDonnell said that in some instances
it will be deliberate policy to dump in non-sensitive areas and if she did, and if others objected, she should be brought to book for it. We did, of course,
of course, express alarm at this apparent intention.
6 As regards exporting to China, McDonnell recognised the uncertainty which exporters faced because of a combination of pricing policies, customs and whether foreign exchange is available to purchase the goods concerned. To help, McDonnell will propose to the Chinese that they submit regular tariff schedules to GATT setting out for each tariff position the basis of customs valuation and whether foreign exchange is available or not.
7
China would also want to maintain QRs, possibly time limited, on balance of payments grounds. They would therefore be justified under GATT Article XII, with its implicit link (as) McDonnell recognised) with IMF advice.
8 In conclusion, one can only be impressed by the amount of thought the Chinese are putting into this matter. With over 150 officials working on this matter alone, and the undoubted skill and expertise of McDonnell, we should not be surprised. But they will be formidable negotiators.
9 I am copying this letter to recipients of yours and (with your letter) to Tony Lane, Eric Beston and Robert Madelin here
еш
Yours eale,
ich all
Mich
M D C JOHNSON
cc A W Dell Esq, UKMis Geneva
Miss R Spencer, UKRep Brussels DJ Plumbly Esq, Washington
H Davies Esq, Peking
P A Cocking Esq, MAFF
M Jay Esq, Cabinet Office
Mr Hum, HKD
Mr Masefield, FED
Mr Hallett, Economic Advisers Mr Clark, Research Dept.
Mr Lane ITP DTI
999-80 Mr Beston OT2/3 DTI
Mr Madelin ITP1A DTI
17 19
86
BOARD OF TRADE BICENTENARY
Page 15Page 16