TNAG-0164-FCO40-200-Export-of-textiles-to-Norway-and-Sweden-1969 — Page 110

(HKK 6/531/1)

106

Hong Kong Department.

24 April, 1969.

I am venturing to take the lead again over the progress of Hong Kong/Sweden textile negotiations, this time over Hong Kong telegram No. 319, which has just arrived. I would not do so if I did not know how preoccupied you are at this time with other matters no doubt of wider signifi- cance. The same is probably true of Howard Collings in the Commodities Department of the Ministry to whom I am copying this letter.

It seems to me that this telegram reads satisfactorily in the light of our own telegrams Nos. 252 and 253 (on which we agreed last week) until the end of paragraph 4 - and for the matter of that in paragraph 8 - but I expect that you will be looking closely at the paragraphs in between.

In the first place it is understandable that Hong Kong should be reluctant to allow a state of continued suspension of export authorisations in view of the undesirable effects on her trade. It is also understandable that the Hong Kong Ministry of Commerce and Industry (which as it happens 18 passing through a period of staff shortage) should wish to avoid further consultations in Stockholm in June. Neverthe- less it seems to me that it will be difficult to allow them to agree to the additional restraints in non-cotton items as they wish on this occasion. You will see that in paragraph 7 of their telegram they are proposing to do so in the case of the same two items, of women's and girls' discontinuous anoraks, and synthetic blouses, to which they made reference in their telegram No. 301.

I think there are two main arguments against allowing this. The first is that Baron de Geer undertook not to ask for new restraints in non-cotton items. The second is that this is presumably a bad moment in time (I refer to Mr. Stans' tour) at which to make any such concessions. It is true that if the Swedish statistics justify it - and they seem to do so, although we have not seen them - we could argue that this was Just such an item by item restraint on the basis of good fac- tual evidence as we should have to admit Hong Kong has on previous occasions conceded and will doubtless have to con- cede again. But would it be better to postpone the issue until June when Mr. Stans' rounds will presumably have ended?