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3. This question of growth therefore remains undecided and the fact that the Board of Trade subsequently "offered" less than
Hong Kong thought they were entitled to has been rankling with Hong Kong ever since. When you came back from your first visit to
Hong Kong in March I recall that you told us to expect another
Despatch on this matter of the sheeting agreement. However, in the event Hong Kong did not send a Despatch but were persuaded to
put their point of view in a semi-official letter which I have now
received from Mr. Jordan.
4.
Mr. Jordan has expressed Hong Kong's views at some length and we must represent them to the Board of Trade because for one thing I am persuaded that they are in the right. However, I see little
chance of reaching a sensible conclusion by further exchanges
between myself and Mr. Stewart for reasons well known to you.
In my opinion the likeliest chance of success would lie in your writing to Stewart's Under-Secretary, Mr. Carey, and I have drafted accordingly. I have used in Hong Kong's favour a simple argument
which is not in fact known to them. This argument rests on what we know to have been Mr. Stewart's great satisfaction with the levels at which he succeeded in restraining Hong Kong. This is clearly
reflected in a copy of a minute to Mr. Carey from him which he was good enough to send to us. It is quite clear that Mr. Stewart had a large margin left to play with (a fact which he never revealed to me during the negotiations) and, knowing that, I suggest we urge
on Mr. Carey the advantages of making a generous gesture. At
the same time we need to indicate our view that the Board of Trade
have a weak case which we may not be able to support if the matter
remains unresolved and has to go to higher authority.
1 July, 1969
b. 5. Cart
(W. S. Carter)
Hong Kong Department
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