XN000022-1985-09-23 — Page 10

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MONDAY, SEPTEMBER 23, 1985

THE PRINCIPAL AMENDMENTS PROPOSED TO THE BILL INCLUDE:

* DEFINING AS +MAJOR EXPORTING COUNTRIES+ THOSE WHO PROVIDE

10 PER CENT OR MORE OF UNITED STATES IMPORTS (PROVISIONALLY, TAIWAN, KOREA AND HONG KONG -- THE EEC IS EXCLUDED FROM THE BILL). THIS GROUP IS SUBJECTED TO CUTBACKS AS BEFORE, WITH A MAXIMUM 30 PER CENT CUTBACK IN TRADE IN ANY CATEGORY FROM 1984 IMPORT LEVELS.

* DEFINING OTHER SUPPLIERS AS EXPORTING COUNTRIES+ GENERALLY

TO BE GIVEN NO GROWTH IN 1985 ON 1984 IMPORTS AND NOT MORE THAN ONE PER CENT GROWTH THEREAFTER.

* EXCLUDING DOLLS AND TOYS FROM THE BILL.

* PROVIDING FOR CUTBACKS IN NON-RUBBER FOOTWEAR IMPORTS.

THE BROAD EFFECT ON HONG KONG APPEARS TO BE TO CUT MFA EXPORTS BY AN AVERAGE OF ABOUT EIGHT PER CENT (COMPARED WITH 12 PER CENT UNDER THE ORIGINAL BILL), AND TO CUT NON-MFA EXPORTS BY ABOUT 30 PER CENT (COMPARED WITH 70 PER CENT), OTHER OBJECTIONABLE FEATURES IN THE ORIGINAL BILL REMAIN FOR HONG KONG AND OTHER SUPPLIERS.

+WE KNEW ABOUT THE POSSIBLE AMENDED VERSION LATE LAST WEEK. IN CONSULTATION WITH THE TEXTILES ADVISORY BOARD (TEXTAB), WE REVIEWED OUR TACTICS IN THE LIGHT OF THESE POSSIBLE AMENDMENTS, AND REVISED INSTRUCTIONS HAVE BEEN ISSUED TO OUR LOBBYISTS THROUGH MR DORWARD, + MR MACLEOD ADDED.

+THE POSITION IS EXTREMELY FLUID AND WE HAVE TO REVIEW OUR TACTICS DAY BY DAY, TEXTAB MEETS AS FREQUENTLY AS REQUIRED.+

IN THE MEANTIME, THE ORIGINAL VERSION OF THE BILL HAS BEEN PASSED WITHOUT AMENDMENT BY THE HOUSE TRADE SUB-COMMITTEE AND IS DUE FOR CONSIDERATION BY THE WAYS AND MEANS COMMITTEE OF THE HOUSE OF REPRESENTATIVES ON SEPTEMBER 26. IN THE SENATE HEARINGS ON THE BILL BY THE FINANCE COMMITTEE WILL BE RESUMED ON SEPTEMBER 23.

+AL THOUGH WE STILL EXPECT THE BILL TO REACH A CL IMAX SOME TIME IN OCTOBER, SAID MR MACLEOD. THE SEQUENCE OF LEGISLATIVE EVENTS MAY CHANGE AND VARIOUS AMENDMENTS MAY BE PROPOSED, AS THE BILL PROGRESSES THROUGH CONGRESS. OR INDEED FASTER PROGRESS MAY BE OBTAINED IF THE BILL'S SUPPORTERS SUCCEED IN TAGGING IT ON TO SOME OTHER BILL ALREADY BE ING PROCESSED THROUGH CONGRESS.

+THE TRADE DEPARTMENT IS IN DAILY CONTACT WITH HONG KONG'S LOBBYING TEAMS IN WASHINGTON. BESIDES CONSULTING TEXTAB, THE TRADE DEPARTMENT WILL CONTINUE TO KEEP MAJOR RELEVANT TRADE AND MANUFACTURING GROUPS IN HONG KONG INFORMED OF DEVELOPMENTS.+

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