TNAG-0046-FCO40-82-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 137

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Hong Kong's exports to Britain, and going beyond the terms of

Article 115 of the Rome Treaty. But that would put them in the

position of "demandeurs' and thus give us a tactical advantage.

it

o seek special arrangements for Hong Kong for a more favourable

rate of application of the common external tariff than the rate generally applied

15. Hong Kong officials are themselves aware of the danger that

any request to the Six for special arrangements for Hong Kong is

likely to stimulate them to seek protection from Hong Kong

competition (see paragraph 5(c) above).

To seek preferential access on a limited scale to the

British market

16. This is open to the same objection as the course discussed

in paragraph 15 above.

Moreover it would plainly be more

difficult to sell to the Six. If faced with a proposal for

preferential access for new products generally, they would be

sure to argue that they were being asked to sign a blank cheque;

to the extent that we tried to specify the new products for

which preferences were requested we should run into obvious

practical difficulties.

17. In our next round of consultations with Hong Kong officials,

it would seem best to begin by probing carefully the validity

of their argument that a preferential duty-free market in the

U.K. is necessary for the launching of new products. Our under-

standing is that many new products have in fact been launched

in the highly competitive United States market. Without

further evidence, it is difficult to accept that success in a

duty-free U.K. market will necessarily lead to, or even

increase, the chances of success in other, non-preferential,

markets. None of the non-textile exports mentioned by Hong

Kong officials last time seemed to provide supporting evidence

for their general argument on this point. Indeed, the success

of stainless steel cutlery exports to the U.K. was shown to be

due, not so much to preferential tariffs, as to a voluntary

agreement which limited the import of competing Japanese

/cutlery.

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