TNAG-0147-FCO40-183-Exports-of-textiles-to-United-States-of-America-1969 — Page 13

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HKK 6/304/1

Mr. Carter

Mr. Wilford

les

17/4

More-

Mr. Wilford has already seen Mr. Midgley's letter to

Mr. Hughes. However, he may wish to see it again alongside

the letter from Mr. Hughes to which it is in answer. over there appears to be something of a lull in the development

of HMG's policy towards American protectionist pressure and it may be timely to consider where we stand with regard to Hong

Kong.

2.

Mr. Wilford may not have seen Sir Eugene Melville's letter

to Mr. Goldsmith and the reply. From that letter we can see 209 what was then the attitude of Olivier Long, Director General

of the GATT. It is possible that he may have changed his mind

since because, apart from anything else, he has been visiting

Japan. But in Geneva Mr. Long seemed to favour the Asian tex-

tile exporters coming to the best compromise they could with

the Americans on the basis of limited arrangements for selec- tive voluntary restraints. There have been rumours, no doubt

put about by the Americans themselves, that the Japanese were

on the point of giving way to the pressure the Americans have

been putting on them. But the most recent indications we have

are that in fact they are still insisting on any bilateral

consultations leading up to multilateral discussions. The time of greatest pressure on them may come when their Prime Minister visits Washington in a week but I recall Mr. Wilford's comments

on the reality of the threat that the Japanese would do a deal

over Okinawa. Washington Tel 3122 indicates that the occasion of the Japanese Prime Minister's visit to Washington might not

be directly linked to the textile issue.

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3.

J

Certainly Hong Kong are not likely to come round to the

GATT view if it is unchanged that they should settle for

a bilateral restraint agreement with the Americans in selected

areas. We heard Mr. Jordan's arguments, which are repeated in Hong Kong telegram No. 854, that the American case on particular

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