TNAG-0046-FCO40-82-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 39

12.

CONFIDENTIAL

(c) They are keenly aware of the danger that

any request to the Six for special arrange-

ments for Hong Kong is likely to stimulate

the latter to seek protection from Hong

Kong competition, e.g. by a demand for a

market disruption clause or severe origin

criteria. For this reason they displayed

a clear preference for course (1) above,

perhaps coupled with course (v): but they

stressed that their views on this were

preliminary.

(d) They recognise that Association and a

Morocco-type Protocol are both unnegotiable.

(e) They themselves drew attention at the consul-

tations to the declining importance for Hong

Kong of the British market (whose share of

Hong Kong exports fell from just over 20% in

1960 to about 17% in 1966); and to the

growing importance for her of the markets of

the Six (whose share grew from 5% to 10%

over the same period).

(f) They see no problems for Hong Kong as regards

sterling or immigration.

We have heard recently that a further idea which the Hong

Kong authorities are considering is that they should refrain from

asking Britain to make any special request in negotiations. This

would not be the same as agreeing that we should make no request.

It would rather be a way of leaving us with the whole responsibility

of deciding how to handle Hong Kong in negotiations, and the whole

of the blame if things went wrong.

CONFIDENTIAL