TNAG-0047-FCO40-83-Britain-s-entry-into-EEC-effect-on-trade-with-Hong-Kong-1967 — Page 20

CONFIDENTIAL

'Furthermore it would be appropriate, when the

exact scope is being decided of the applicants'

acceptance of the common customs tariff, to examine the

case of certain products or sectors of particular

importance where acceptance of the customs duty can

only have full significance if it also implies

acceptance of a certain number of fundamental decisions

of industrial or commercial policy.'

All that can be inferred with reasonable certainty from this

is that the Commission seem to think that the Community will

need to seek special arrangements in their own favour on

textiles.

The Views of the Hong Kong Government

11.

We

Officials have had two rounds of consultations with the

Hong Kong Government about the implications for Hong Kong

of British entry into E.E.C. and about what might be done to

mitigate any adverse effect on Hong Kong. The first round

of talks took place in July and the second in October.

discussed the likely impact on Hong Kong's exports to Britain

product by product, paying special attention to cotton

textiles; we touched on other ways in which the Hong Kong

Government thought that their interests might be affected

including the possibility of changes in the international

role of sterling, and the consequences for Hong Kong's

representation in the GATT. Finally we discussed whether it

would be necessary or advisable for Britain to seek special

arrangements for Hong Kong in negotiations and, if so, what

such arrangements should be.

12.

G

The Hong Kong Government acknowledged that, in view of

the diversification of the territory's exports in the

intervening years, Hong Kong was in a less vulnerable position

now than she had been at the time of the previous negotiations.

/Nevertheless,

CONFIDENTIAL