C. & 1 1504
2700463
60x100-4/68-364524
To:
Director of Commerce and Industry, Hong Kong.
2:
From:
Memorandum No. 225
Counsellor for Hong Kong Commercial Affairs, Brussels.
File No.
Date
of 28th April was hound to elicit some such reaction. I think that Hannay did exaggerate the potential dangers to some extent but this is past history following the Director's personal visits to London and Brussels; my unilateral position in this field has now, so to speak, been somewhat clarified although I have no final record of this from you.
final
7.
In any case, clarification of my liberty to hold exploratory talks with Ernst et al without commitment can hardly be said to take us any way at all along the road to a formal reaction to the Commission's developing proposals. It was not intended that it should; it was merely to clear away the brush- wood. But Hannay's intention in his letter of 2nd May was to stimulate a farther-ranging roaction. Whether this has in fact occurred, particularly in London, is not clear. Your paper, and Carter's writings, indicate the contrary. Carter's attitude on the wider general issue seems besitant, if not nogative, and,, whilst one can appreciato HMG at present wishing to continue to adopt an attitude of "wait and s00* generally on EEC matters, I think there is some danger in our conforming with this in the possible resultant loss of tempo. It is much easier to influence EEC thinking before it has fully crystallised and we must be aware of the effects of the passage of time. I doubt if Hong Kong an any longor benefit from H masterly inactivity and I detect a similar feeling in Jones' lotter to Carter of 12th June. indicated in paragraph 25 of the TIAB paper "hypothetical possibili- tios may not materia Esd", but we axe faced now with overt directin intentions to restrict Hong Kong's trade, not general instruments, and should the possibilities materialise it may be too late for us to recover lost ground. We obviously have none of the tactical advantages of the Japanese against whơm of Course these proposals are basically directed.
As
8.
In short, my worry is that HMG may feel that Hong Kong's interests in this field are some thing of an embarrassment at this juncturo (in view inter alia of the possible re-opaning of membership negotiations) and that there is a danger of a definite lack of further initiative coming from Whitehall. If I am at all right in this thinking, it could be that, for example, a follow-up of Jones' 12th June approach (and the Director's discussions with London?) may now be required in the light of developments.
9.
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To my mind no harm would stem from a formal approach to the Commission at this stage. Even if however our policy ie to bo to continue to "wait and see " for a little while longer, there
to be no reason why we should not now at least fully clarify with MMG what form such a future approach mêght take in due course (and how it should be conducted) in order that we are not later caught unawafès. I am not here referring on to the first formal
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