CO129-623-2 Rubber Industry- report and correspondence on the labour situation 1-12-1950 - 31-3-1951 — Page 2

4. Gordon Taylor

Mr. Emanuel.

8/7. rfencl. 14.12.502

I discussed this with Mr. Grimwood at the Hong Kong Office to-day.

I gather hat the importations of Hong Kong rubber footwear have fallen off considerably, partly because of the mild winter last year, and the consequent overflow of stocks to this winter. Apart from that, the figure of five million pairs, said to have been shipped to the United Kingdom in the first six months of this year, is thought to be an exaggeration.

Dealing with the points in paragraph 4 of the record as they occur, the position is as follows:-

(a) The Hong Kong factory, which closed recently, was forced to do so, partly because the proprietor had been gambling in rubber and had come unstick. Provided the Hong Kong manufacturers are able to retain their market in the United Kingdom, there is no reason to suppose that other factories will have to close;

(b) The proposed diversion of these exports to other parts of the Commonwealth is not a matter which can be decided by Government action. India and the other countries of the Commonwealth can please themselves whether or not they import Hong Kong footwear, and there is no reason to suppose that the Hong Kong manufacturers have not already sounded the Commonwealth market;

(c) B.S.I. standards are already being employed in Hong Kong in a number of industries. They have not yet been applied to the rubber footwear industry, but I was assured that allegation that the Hong Kong products are inferior to those of the United Kingdom is not alto- gether true. I was shown a pair of rubber boots for children which had been produced by a Hong Kong firm alongside a similar article which had been produced here for export to Hong Kong. It was quite obvious, even to the uninitiated, that the Hong Kong article was very much better in finish and design;

As you

(a) There is no truth in the suggestion that H.M. Customs have favoured imports from Hong Kong. may have heard, the import of Hong Kong shirts has been held up very badly, owing to the necessity of checking the Empire content for Customs purposes. The same applies to rubber footwear. In spite of the hold-up and the embarrassment to importers who have had to deposit the whole price of the goods beforehand, the Customs have not relaxed their standards and have, indeed, engaged extra staff to enable them to carry out the investigation as quickly as possible.

(e) There is, of course, a trading season, so far as the retail trade is concerned. The winter is naturally the time when people buy wellington boots and overshoes, but there is also the summer trade in beach shoes and an all the year round sale of ordinary canvas gym shoes.

Mr. Grimwood had not very much to say about the possibility of the British and Hong Kong manufacturers being able to get together. The opinion of those merchants who handle Hong Kong imports of these goods is that the United Kingdom industry could not by itself satisfy the demand. I imagine that the kind of agreement which the United Kingdom people would favour would be one which sought to cut down the quantity of