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US special 301 negotiations against China
In response to press enquiries on the preliminary assessment of the possible impact on Hong Kong's re-export trade if the US did implement retaliation against Chinese products under Special 301 provisions, a spokesman for the Trade and Industry Branch said the preliminary study suggested that, based on statistics on Hong Kong's re-export of Chinese products to the US in 1993, about US$1.45 billion of Hong Kong's re-export could be affected if the US did implement the proposed retaliation list in full.
"However, it is expected that even if the US did implement retaliation, the proposed retaliation list would not be implemented in full," he said.
According to the press statement issued by the US Trade Representative (USTR) on December 31, 1994, the USTR estimates that China's exports to the US of the products on the proposed list amounted to about US$2.8 billion a year.
In the event of a final determination for retaliation, the affected products would be drawn from the proposed retaliation list and would be subject to increased tariffs up to 100 per cent.
"The USTR has indicated that he would narrow the list and target US$1 billion of Chinese products for the increased tariffs if the US and China could not agree on steps to address US's intellectual property rights concerns," the spokesman said. The Hong Kong re-export items that might be hardest hit if the proposed retaliation list was implemented in full include electrical products and plastic articles.
In 1993, the value of the US imports of these two categories of products from China amounted to US$1.16 billion, slightly more than the US$1 billion worth of Chinese products which the USTR would target for retaliation.
Of these US$1.16 billion worth of Chinese products, the value of the products that were re-exported to the US through Hong Kong amounted to US$827 million in 1993.
"This amount (US$827 million) represents only a very small portion of Hong Kong's trade: 3.8 per cent of Hong Kong's re-export of Chinese products to the US in 1993, or 0.3 per cent of Hong Kong's total global trade in 1993," the spokesman said.
End/Monday, January 9, 1995