TNAG-0046-FCO40-82-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 209

CONFIDENTIAL

6.

Sir A. Snelling recalled the provisions which had been

envisaged for India, Pakistan and Ceylon at the end of the

previous negotiations; he said that the U.K. hoped that the

Six would be prepared to accept a similar package in Britain's

second approach to Europe.

COMMONWEALTH PREFERENCES

7

Mr. Haddon-Cave said that his Government had assumed that

the whole Commonwealth preference system would be gradually

dismantled following British entry. Sir A. Snelling said that

Britain accepted that the Commonwealth preferences which she

herself enjoyed in many Commonwealth countries would come to an

end;

but there were other areas of inter-Commonwealth trade,

based on Commonwealth preference, which need not necessarily be

affected. Mr. Haddon-Cave said that outside Britain, the

Territory enjoyed considerable preferences in New Zealand. In

1966 out of SHK 65 million worth of trade SHK 52 million worth

was given preferences. She also enjoyed preferences in Malaysia,

Singapore, Jamaica and Trinidad. Although Commonwealth

preferences were based on multilateralism, Hong Kong had assumed that the withdrawal of the lynchpin (i.e., Britain) would lead

to the collapse of the system. Sir A. Snelling said that in the

negotiations Britain would be pressing hard for the safeguarding

of New Zealand interests; she might therefore be able to influence

New Zealand to continue preferences on Hong Kong goods. However,

Hong Kong's exports to New Zealand were industrial and the recently

ratified Australian/New Zealand Free Trade Area Agreement was

mainly based on trade in industrial goods; this could result in

Australian pressure being brought to bear on New Zealand to

terminate the preferences she accorded to Hong Kong.

Mr. Haddon-Cave said that this was unlikely;

the bulk of

Hong Kong's trade with New Zealand was in textiles and Australia

did not have a competitive textile industry.

CONFIDENTIAL

18.