TNAG-0138-FCO40-174-Conduct-of-Hong-Kong-commercial-relations-1969 — Page 184

FCO40 Hong Kong Department Records 聯邦事務部香港部檔案 All

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17 OCT 1969

CONFIDENTIAL

IHKK 6/18

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Originalnas NKK 6/371

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Hong Kong: Textiles Parc(:)

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Mr. D. Jordan, Deputy Director of the Hong Kong Department of Commerce and Industry, and Mr. D. J. C. Jones, Counsellor (Hong Kong Affairs) in the U.K. Mission in Geneva, called on the Permanent Secretary to the Board of Trade at their own request at 4.20 yesterday. They were accompanied by Mr. K. M. Wilford, Assistant Under-Secretary of State at the Foreign and Commonwealth Office (FCO), and by Mr. W. S. Carter, head of the FCO's Hong Kong Department. You, Mr. Stewart and Mr. Pryke were also present.

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Mr. Jordan said that the tendency was for HMG to devolve more and more upon the government of Hong Kong the responsibility for conducting its affairs. The colony's annual financial estimates no longer had to be submitted for the Secretary of State's approval. The Governor had the power to introduce legislation on any matter in the Legislative Council, though if it were passed the Secretary of State retained the power to advise Her Majesty to disallow it. The Secretary of State could of course send instructions to the Governor, but in practice he rarely did

So.

3. De facto authority to conduct commercial negotiations on cotton textiles, Mr. Jordan continued, had long been delegated to the Hong Kong government. Indeed, the FCO had recently suggested that Hong Kong should be given such authority formally in every case where the Governor was satisfied that no U.K. interest was affected.

4. Mr. Jordan recalled that when, in December 1965, his government had been inclined to persuade the Germans to invoke Article XIX of the GATT to deal with certain non-cotton textile items, the Board of Trade had advised them in a telegram to try voluntary restraint instead. Subsequently, Hong Kong had with IMG's approval negotiated voluntary restraint arrangements for hon-cotton items with Canada in 1967 (polyester-cotton garments) and Norway and Sweden in 1968. When further negotiations were held in Ottawa in 1968, the British High Commission, though fully informed, had not troubled to be represented. His government had therefore taken it as established that HMG were content for them to negotiate voluntary restraint arrangements with countries that had an Article XIX-type case for controlling their imports of non- cotton textiles from Hong Kong. This impression was confirmed when, after initial hesitations, Mr. Hughes had confirmed that, on all but two of the items in question, Hong Kong should try to secure voluntary restraint in a further round of non-cotton negotiations with Sweden. When, therefore, Hong Kong representativo had gone to Ottawa for discussions (at which the High Commission were represented) about the renewal of the non-cotton voluntary restraint arrangements which expired on 30th September 1969, they had on 7th June telegraphed to inform London that they had arranged negotiations on the renewal of the polyester-cotton garment arrangement and, at Canadian insistence, its possible. extension to polyester/polynosic shirts. The reply had been an unprecedented refusal of permission to negotiate.

5. Mr. Stewart commented that the Hong Kong government had never before arranged non-cotton negotiations without IIMG's prior knowledge and approval of the lines of the intended negotiators' instructions. Mr. Jordan remarked that London's close control had always greatly inconvenienced Hong Kong in her negotiations; tho Hong Kong Textiles Advisory Board (TAB) were not aware of it and would not accept if if they were.

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