TNAG-0045-FCO40-81-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 164

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4. Early in the negotiations, it became clear that the Six

would not consider extending to Commonwealth countries in Asia

the status of Associated Overseas Territories under Part IV

of the Treaty of Rome. (Such associates enjoy unrestricted

free entry into the Community for all products except those

within the scope of the common agricultural policy, and are

also eligible to receive aid from the European Development

Fund). We were, however, able to secure agreement that

Britain should apply the common external tariff to imports of

manufactured goods and tropical products from Malaysia over a

longer transitional period than that for similar imports from

developed Commonwealth countries (this is called "soft decalage").

It was also agreed that the enlarged Community would negotiate

a trade agreement with Malaysia.

5.

Reactions in Malaysia to the Government's recent approach

to the B.E.C.: So far as the public at large are concerned,

there is very little interest in, or awareness of, the whole

issue. The Malaysian Government have taken the matter very

caimly. Reports suggest that they are on the whole in favour

of British membership of the Community on the grounds that it

will strengthen the British economy and thereby the Sterling

Area

CONFIDENTIAL