CONFIDENTIAL
MFN
CONFIDENTIAL
FM HONG KONG
TO IMMEDIATE F C O
TELNO 3086
OF 03104OZ OCTOBER 91
AND TO PRIORITY PEKING, WASHINGTON
Ziz
004436
MDHIAN 5697
TOP COPY Q DIST?
WASHINGTON PLEASE PASS COPY TO HKETO
YOUR TELNO 1784: PRESS COMMENTS: HONG KONG FIRMS AND CHINESE
PRISON LABOUR
1. WE HAVE INDEED BEEN FOLLOWING THIS ISSUE CLOSELY. REPORTS OF
THE PROBLEM FIRST EMERGED IN THE US SOME TIME AGO, AS ONE OF THE MANY AREAS OF CONCERN IN THE U S/CHINA RELATIONS. IT HAS RE-
EMERGED WITH NEW FORCE AS A RESULT OF THE RECENT MEDIA ATTENTION IN THE U S. THIS IS UNFORTUNATE IN THE CONTEXT OF THE MFN DEBATE, BUT OUR ASSESSMENT AT THIS STAGE IS THAT IT SHOULD NOT/NOT PROVE
DECISIVE IN SWAYING SENTIMENT IN CONGRESS.
2. THE US CONSULATE GENERAL HAVE MENTIONED THIS ISSUE TO OUR
TRADE OFFICIALS. THE LOCAL US CUSTOMS REPRESENTATIVE HAS ALSO
ASKED OUR CUSTOMS AND EXCISE DEPARTMENT FOR INFORMATION
CONCERNING ONE OF THE COMPANIES IDENTIFIED IN THE US MEDIA
REPORTS. OUR CUSTOMS AND EXCISE DEPARTMENT WILL RESPOND THAT ON
THE BASIS OF INFORMATION AVAILABLE TO THEM, THERE IS NO EVIDENCE
OF DIRECT RE-EXPORTS TO THE US FROM THE COMPANY CONCERNED.
3. WE ARE PUBLICLY TAKING THE LINE THAT WE ARE CONCERNED BY
THESE REPORTS: THAT IT SEEMS UNLIKELY THAT THE ALLEGED TRADE BREAKS ANY HONG KONG LAW: AND, IF ASKED, THAT THE US AUTHORITIES HAVE CONTACTED US ON THE ISSUE.
4.
WE DO NOT/NOT THINK THAT THIS ISSUE WILL HAVE A DIRECT
KNOCK-ON-EFFECT ON SPECIAL 301 OR SECTION 301 ACTION WHICH THE
US MAY TAKE AGAINST CHINA. SUCH ACTION WOULD BE TAILORED TO DEAL
WITH IDENTIFIED INTELLECTUAL PROPERTY RIGHTS PROBLEMS AND OTHER
TRADE ISSUES. BUT THIS ISSUE COULD HAVE AN IMPACT ON THE
POLITICAL ATMOSPHERE IN WHICH SPECIAL 301/SECTION 301 ACTION IS CONSIDERED. AS NOTED ABOVE, IT WILL ALSO BE UNHELPFUL IN THE MFN DEBATE.
5.
FOR THE TIME BEING WE DO NOT EXPECT TO TAKE ANY ACTION ON
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CONFIDENTIAL