TNAG-0153-FCO40-189-Exports-of-cotton-textiles-to-Canada-1969 — Page 112

CYPHER/CAT A

IMMEDIATE HONG KONG

TELEGRAM NUMBER 660

CONFIDENTIAL

NEUTRAL

CONFIDENTIAL

80

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TO: FOREIGN AND COMMONWEALTH OFFICE

20 AUGUST 1969

ADDRESSED FCO TELEGRAM 669 OF 20 AUGUST REI OTTAWA.

ገና

MY TELEGRAM 659.

FOLLOWING IS TEXT OF CANADIAN STATEMENT, BEGINS :-

'AS YOU KNOW WE WERE INFORMED YESTERDAY MORNING FOR THE FIRST TIME

THAT THE BRITISH GOVERNMENT HAS INSTRUCTED THE HONG KONG GOVERNMENT

NOT TO ENTER INTO ANY FINAL AGREEMENT FOR NEW OR EXTENDED REST-

RAINTS OF EXPORTS OF NON-COTTON TEXTILES TO CANADA PENDING DIS-

CUSSIONS IN OTTAWA ENVISAGED FOR LATE SEPTEMBER BETWEEN REPRESENT-

ATIVES OF THE U.K. AND CANADIAN GOVERNMENTS, WITH PARTICIPATION BY A

REPRESENTATIVE OF THE HONG KONG GOVERNMENT. WE UNDERSTAND THAT THE

U.K. GOVERNMENT THOUGHT THAT THESE TALKS MIGHT TAKE PLACE AT THE

TIME OF THE FORTHCOMING VISIT TO OTTAWA OF MR HUGHES OF THE BOARD

OF TRADE TO DISCUSS THE PROPOSED U.K. COTTON TEXTILE TARIFF CHANGES.

THIS UNEXPECTED DEVELOPMENT CAUSED US TO RECONSIDER WHETHER THERE WAS

ANY PURPOSE IN PROCEEDING WITH THE DISCUSSIONS THAT HAD BEEN

ARRANGED FOR THIS WEEK, SINCE AS I SUBSEQUENTLY EXPLAINED THE

PROPOSAL THAT WE HAD DECIDED TO PUT FORWARD WAS A PACKAGE'

PROPOSAL COVERING BOTH COTTON AND NON-COTTON TEXTILES THAT HAD BEEN

WORKED OUT THROUGH A QUITE DELICATE BALANCING OF RELATIVE ADVANTAGES

AND DISADVANTAGES. YOUR INDICATION THAT THERE COULD BE NO FINAL

SETTLEMENT ON THE NON-COTTON ITEMS LED US TO WONDER WHETHER WE COULD

PUT FORWARD THE PROPOSAL WE HAD DEVELOPED. ON THE OTHER HAND WE

WERE GIVEN TO UNDERSTAND THAT WHILE FINAL AGREEMENT ON THE NON-COTTON

PENED IN

R.CH TRY No.51

20 AUG 1969

HKK6/331/1

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