TNAG-0143-FCO40-179-Exports-of-textiles-to-United-States-of-America-1969 — Page 73

CYPHER/CAT A

CONFIDENTIAL

S

PRIORITY UK MISSION GENEVA TO FOREIGN AND COMMONWEALTH OFFICE

PRIORITY U.K.MISSION GENEVA TELEGRAM NO.13 TC HONG KONG OF 2 APRIL, 1969

CONFIDENTIAL [ NEUTRAL]

ADDRESSED TO HONG KONG TELEGRAM NUMBER 13 RFI F C O HONG

KONG GOVT OFFICE LONDON OFFICE WASHINGTON (FOR. HERMANN) BRUSSELS (FOR PURVES).

MY TELEGRAM NUMBERS 205 AND 206 TO F C O.

XTILE

U S PROPOSALS FOR TEXTILE RESTRAINT.

FROM JONES.

LAST

! REF

$

RCF.

AS I SEE IT THE MOST IMPORTANT NEW ELEMENT IN THE SITUATION

FROM HONG KONG'S POINT OF VIEW IS LONG'S THINKING. IT IS

OBVIOUSLY IN HONG KONG'S INTERESTS TO AVOID RESTRAINTS ON

MAN-MADE FIBRES AND WOOL IF THEY CAN BE AVOIDED AND I PRESUME

YOU WILL CONTINUE TO RESIST AMERICAN PROPOSALS AS LONG AS THIS

POLICY IS VIABLE. BUT IN THIS MATTER ABOVE ALL HONG KONG CANNOT AFFORD TO BE CUT OFF IN THE FORWARD TRENCHES IF OTHERS-

MAINLY THE EUROPEANS BUT ALSO MAYBE THE JAPANESE CONDUCT

A SUDDEN RETREAT.

2. THIS MEANS THAT IF (REPEAT IF) SOME SORT OF RESTRAINT OR RESTRICTION BECOMES INEVITABLE HONG KONG MUST, FOR THE SAKE OF HER LIVELIHOOD, TRY TO PLACE HERSELF IN THE BEST POSITION TO RIDE THE BLOW, AS I SEE IT HER INTERESTS WOULD BE MET

IN THE FOLLOWING DESCENDING ORDER-

(A) NO RESTRICTIONS:

(B) AN EXTENSION OF THE CT A, IF POSSIBLE WITH IMPROVEMENTS: (C) SOME OTHER ARRANGEMENT WITH PRECISE RULES AND OBLIGATIONS: (D) VOLUNTARY RESTRAINT UNDER SUCH PRESSURES AS DEVELOP: (E) IMPORT RESTRICTIONS.

3. MY MAJOR REASONS FOR PREFERRING (B) TO (C) OR (D) ARE (1) GREATER FLEXIBILITY AS HONG KONG HAS 750 MILLION YARDS OF

COTTON TEXTILE QUOTAS FOR POTENTIAL ROLL-IN TO OTHER FIBRES: (11) THE RULES ARE KNOWN AND ARE WORKABLE: IN THE CASE OF (D)

THE RULES WOULD BE WORKED OUT AD HOC AND COULD BE CHANGED

AD HOC UNDER PRESSURE:

CONFIDENTIAL

/(111) WE CANNOT