CONFIDENTIAL
3
The question is, however, how H.M.G. and the Hong Kong Government should react in this sort of situation. You will see from the record that I took a pretty robust line with Ernst.
The discussions were after all informal and I did not think that we should leave him with any illusions that we would take anything lying down and that we would not consider Hong Kong's G.A.T.T. rights in relation to any new restrictions that may be put forward. But that is as far as it has gone at the moment.
9.
W
For the future I think we will need to keep in close touch with you and the Board of Trade on how we should handle this question. I am not saying that it will come to the boil immediately a proposal of the Commission will not, after all, necessarily be accepted by the Council and there will probably be much arguing between the individual member states. In addition, from our point of view in Hong Kong, we will as usual be realistic and will assess the overall position as it affects our interests. For instance, in the last resort, it may be that it would pay not to kick too strongly over import quotas on one or two small items, and perhaps surveillance on one or two others, if the whole of the rest of our exports to the E.E.C. were enshrined in the Common liberalisation list. But things may not be as easy as that and it may be that at some stage demarches will need to be made with the Commission and the individual member states.
10.
I am also not forgetting that, if and when the question of British entry to the Community again becomes ripe, this subject will need to be slotted into H.M.G.'s overall position in the negotiations. But what I am suggesting is that, at least in the preliminary stages and as regards the details, there can be a role for Hong Kong officers overseas to play in handling this question on the basis of instructions to be agreed between Hong Kong and London.
11.
In the light of this we doubt whether it would necessarily be the best tactics for UKDEL Brussels to put in the "first prong" on this subject with the Commission as suggested by Hannay; and we feel that no firm reaction should yet be made until there has been an opportunity for us in Hong Kong to discuss the question with you and the Board of Trade. The opportunity for at least a preliminary run over the ground presents itself with David Jordan's current visit to Europe, and I am supplying him with a copy of this letter and background papers in case time can be found for it (probably after he returns from Scandinavia) I am also sending a copy of this letter to Bob Goldsmith and Ingram in the Board of Trade and to Hannay in Brussels.
•
ever
Gourt
Darch
(D.J.C. Jones)
W.S. Carter, Esq., C.V.O.,
Hong Kong Department,
Foreign and Commonwealth Office,
King Charles Street,
London S.W. 1,
ENGLAND
Encl.
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