TNAG-0135-FCO40-171-Tariff-preferences-for-developing-countries-1969 — Page 95

CONFIDENTIAL

6. I then outlined the propositions set out in

paragraph 6 of the paper given to Tran. This, I

admitted, did contain some element of discrimination as

it recognised a certain application of competitive need

But the criteria applied were based on

criteria.

objective and reasonable figures and something along those

sort of lines would, in the last resort, be acceptable.

The

7. In reply the French hinted that the Quai d'Orsay and the Quai Branly (Economy and Finance) would be pleased tu

see the Hong Kong problem settled on terms which were not

unacceptable to HMG. But the problem was the Minister of

Industry and the pressure put on him by the Patronat.

fact was that Hong Kong had gained a reputation which it was

difficult to eradicate. Some of the backwoodsmen had

probably hardly heard of Taiwan and South Korea, but they

all reacted fearfully to the reputation of Hong Kong.

Mueller-Thuns confirmed that this was true of industrial

pressure groups throughout the Community "even in Germany

and Holland". They would, however, look at the dossiers

again to see what could be done.

8. After the lunch Mueller-Thuns took me aside and said

that the original position had been five for the exclusion

of Hong Kong and one (Germany) for inclusion. The

Commission's compromise, poor as it was, was the best that

could be got through the opposition. He pointed out that

there would in practice be no ceilings on non-sensitive

products and new products but did not deur when I countered

that non-sensitive products for Hong song came to only about

$6 million out of Hong Aong exports to the Community of over

$100 million. iis conclusion was however, that, as far as

he was concerned, we had made a case and he would recommend

that, in view of HMG's reactions, the German government

should reopen the issue within the Six. On the whole I

think this is reasonably encouraging.

19.

CONFIDENTIAL