TNAG-0045-FCO40-81-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 8

CONFIDENTIAL

5. A table setting out Hong Kong's principal exports (including re-exports) in recent years to Britain and to the

EEC, the margin of preference which they enjoy in the British market, and the EEC tariff/levy treatment of such exports is

at Annex E.

6. The items listed in paragraph 4 would be directly

affected by our entry into the Community, either by loss of

preference or by the application of the common external tariff.

However, as we have seen above, it is worth recalling that,

while Britain's relative importance as a market for Hong Kong's

exports has tended to remain steady or to decline slightly in

recent years, that of the Six has been growing rapidly despite

the dismantling of intra-Community tariffs and increased

discrimination against Hong Kong and other third countries.

Moreover, the Community has in the Kennedy Round agreed to make

substantial reductions in the c.e.t. many of them cn products

of interest to Hong Kong. In any case it seems that Hong Kong

can overcome normal tariffs.

quota restrictions.

What restricts its exports is

Britain, in joining the E.E.C., would

not be required to impose quota restrictions, as long as the se

are matters for individual Governments.

Hong Kong in the 1961/63 Negotiations

7. No provisional agreement had been reached before the

negotiations ended. The Six rejected the original British

proposal that Hong Kong should be associated with the enlarged

Community under Part IV of the Treaty of Rome. They did not

consider that association was appropriate for a dependent

territory with well developed manufacturing industries. The

British proposal on the table at the end of the negotiations

contained the following elements:

CONFIDENTIAL

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