Not-dant.
Discussed indrad.
(HKK 6/331/1)
Mr. Wilford
We have to decide what action to take over Hong Kong
telegram No. 655 in which they report the outcome of their
first day's discussions with the Canadians. Significant
developments seem to have been the following,
(a) As expected the Canadians are aggrieved, principally
because, having been told nothing before they left Ottawa,
they were expecting to reach an agreement in Hong Kong.
However, the Canadians may well have reacted with more
obvious surprise and anger than they really felt.
Rather
(b) The Canadian delegation expressed their intention to
advise Ottawa to demand early negotiations with HMG.
unexpectedly Hong Kong, who would normally bitterly resent
any suggestion that their commercial affairs should be dis- cussed between HMG and a third party, recommend that we agree
to meet them.
(c) Treating the whole negotiations as a package deal, as we
expected, the Canadians have intimated that their final cotton
terms will now not be as good as they would have been. This
may be no more than negotiating tactics and apart from the use of the word final in the telegram there is no suggestion that the Canadians have threatened to withhold agreement on cotton pending agreement on non-cotton.
(a) The Textile Advisory Board have learnt of our intervention. Whatever the outcome of the discussions now the political damage so far as Hong Kong industry is concerned has been done.
(e) The export of polyester/polynosic shirts has now been finally frozen. Whatever the chances, and they might have been remote, that an agreement with the Canadians on this category would have allowed the trade to continue we shall be blamed by Hong Kong industry for having brought it to a
standstill.
/ I recommend,
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