TNAG-0046-FCO40-82-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 220

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The

but possibly alter the pattern of trade, upgrade the quality

of exy rts and encourage Hong Kong to specialise in those

items in which her industry had a competitive advantage.

profitability of Hong Kong's export trade with the UK might

be impaired rather than the volume. Since the c.e.t. was some

20-25% lower than the UK m.f.n. rate, it could be argued that

by itself it was not sufficiently heavy to have the same

restrictive effect on Hong Kong's trade as our present quantit-

ative restrictions. The UK felt, however, that Hong Kong could

usefully submit a note showing how it believed the c.e.t.

would bear on different categories of exports.

19. Mr. Haddon-Cave wished to know the UK Government's

intentions for regulating trade in cotton textiles after 1970

If the UK were when the present quota controls would expire.

to accede to E.E.C., her industry would almost certainly bene-

fit from increased protection, given that the Six would insist

on a severely limited intake of cotton textiles into the

Community and that they would not agree to an isolation of the

UK market. The wide disparity between the role of imports in

the UK and the Six meant that there would have to be some

adjustment of the UK intake if she were to accede.

20.

The UK delegation pointed out that domestic industry was

at present carrying out a survey into the productivity of its

various sectors and on the results of this would depend the

policy on imports to be adopted after 1970. Industry, however,

had not been encouraged to look for increased protection.

21. The growing restrictive nature of the E.E.C. Common

Commercial Policy and the likelihood of the UK having to

conform in some measure to it was stressed by the Hong Kong

Delegation. Although country allocations were determined bilaterally, no member of the Six could engage in bilateral

discu .ons without the Commission's consent, once the

aggregate Community quotas had been determined.

The E.E.C.

had indicated that they would invoke the market disruption

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