0003239
G.F. 323
CONFIDENTIAL
11.
million square yards
grey wide sheeting
finished wide sheeting
sheets
13.459
3.049
0.880
17.388
the figure for grey having been adjusted to take account of shipments under the de-categorisation arrangements.
50.
Mr. Jordan stressed that, as the cut-back proposed was so substantial, the compensation offered would have to be on the same scale if Hong Kong was to be persuaded to accept the package. Mr. Stewart replied that any offer of compensation by H.M.G. would have to take account of the fact that Hong Kong had been forewarned of the present request as long ago as October 1967; in the circumstances, it would be unrealistic of Hong Kong to expect too much. Mr. Jordan pointed out that Mr. Ord-Johnstone's letter of October, 1967 had given no precise indication of the B.O.T.'s intentions. The fact that canvas and duck no longer appeared to be a problem, although referred to in the letter, made it clear that the 3.0.T., at that time, had not determined what action was necessary. Consequently, he could not accept that Mr. Ord-Johnstone's letter was in any sense a formal notification that a request would be forthcoming. certainly did not meet C.T.A. Article 3 criteria.
The letter Having regard
to the imprecise nature of Mr. Ord-Johnstone's communication and the time lag, he was most surprised that the B.O.T. should expect Hong Kong to view the possibility of a cut-back with equanimity. Mr. Stewart replied that as, in the B.O.T.'s view, Hong Kong had been adequately warned and H.M.G. could, in fact, havo requested a restraint on the trade much earlier, he found it difficult to understand how Hong Kong could resist this cut-back.
51.
Mr. Jordan romarked that, when the Heads of Agreement were reached in 1966, Hong Kong had assumed that the B.O.T. knew what sectors of the British industry were particularly sensitive.
He was Presumably, the limits agreed reflected this awareness. surprised that the B.O.T. should now be seeking not only increased categorisation but also cut-backs on present performance. Mr. Stewart said it had not been possible in 1966 to foresee that the British market for wide sheeting would be disrupted; H.M.G.'s generosity had no doubt contributed to the creation of the problem.
52.
Mr. Jordan observed that the proposed cut-back to 3.0 million square yards for wide finished shecting was particularly harsh.
Mr. Stewart replied that this was the most severely affected sector of the British industry, but he would be prepared to offer some compensation to meet any difficulties Hong Kong might experience. Mr. Jordan repeated his puzzlement that when the special country agreements were reached with Hong Kong and India in 1966, Britain's tolerable intake of wide sheeting and sheets from these countries had amounted to some 45 million square yards per annum, whereas now, in 1968, acceptable imports had apparently been reduced to 30 million square yards per annum. Mr. Stewart replied that future developments could not have been accurately anticipated at that time.
53.
Mr. Jordan then enquired what object the B.O.T. thought the Export Authorisation (E.A.) system for "basket" items served.
/Mr. Stewart
CONFIDENTIAL
No comments yet.
Private notes are available after approval.