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when he was in Hong Kong in May to discuss possible monsUPOS te protect the US textile industry from competition from importa ir. 8tana, who encountered firm opposition from the Hong Kong Government, warned that "the dialogue would continue“.
Cn 23 September the US Consul Teneral formally proposed to
the Director of Commercs and Industry negotiations for a compre- kensive bilateral agreement on man-zade and wool fibre textiles. He said that this approach had bean decided "at the highest US dovernment level" and rehearsed the sane weak case for restraining
imports which Er. Stans had presented.
We immediately reminded Hong Kong that major issues of British international commercial policy were involved and considered trying to channel the Amerisens into the more correct precedure of an approach to HMO rather than te Hong Kong. In the event we decided against this.
Hong Kong's reply to the US approach, carefully concerted with ourselves, was delivered on 8 October. After some statistical re- buttal of the American case it recalled that Hong Kong had no comprehensive bilateral agreement of tào sort proposed with any other country sutside the context of the cotton Textilsa Arrangement so that a new issue of principle would be involved. Hong Kong would not therefore enter into gomprehensive negotiations an non-cotton textiles but were prepared as always to fulfil their general GATT obligations and to sensult on any particular sectors where Keng Kong imports were omsing or threatening serious injury
to domestic industry.
The discussions were hold on 13 October in Geneva after the Cetton Textiles Committee (C.T.C.) meeting, with Cir Sugene Melville in the chair. The Americans renewed their argument that the disruption of their industry was an accomplished fast in certain areas and threatened in others. They even outlined a form of agreement but were told that substantive dissuasion was
premature
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