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PRIORITY UKMIG GENEVA TO FOREIGN AND COMMONWEALTH OFFICE PRRITY UKMIS GENEVA TEL. NO. 6 TO HONG KONG-28 JANUARY 1970
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ADDSD TO GOVERNOR HONG KONG TEL NO 6 OF 28 JANUARY REPTD FOR INFO TO F CO, HONG KONG GOV. LONDON OFFICE, BRUSSELS (FOR DODGE, UKDEL BRUSSELS, WASHINGTON (FOR HERMAND EIVED IN
FROM JONES
HONG KONG/33: COTTON TEXTILES
REGISTRY No. 51
F .... RSRYN45
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- 2 JAN 1970
MCK
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M/13/393
PRELIMINARY DISCUSSIONS WITH EEC COMMISSION WERE HELD IN BRUSSELS ON 26 JANUARY TO CONSIDER ACCESS LIKELY TO BE OFFERED TO HONG
KONG IN EVENT OF EXTENSION OF CTA. ERNST WAS ACCOMPANIED BY TWO COLLEAGUES, DODGE, DORWARD AND MYSELF REPRESENTED HONG
KONG.
2. FROM THE BEGINNING ERNST MADE IT CLEAR THAT AS YET HE HAD NO MANDATE FROM MEMBER STATES AND COULD THEREFORE ONLY DISCUSS WITHOUT COMMITMENT. WE SAID THAT WE HAD COME, IN RESPONSE TO CTC CONCLUSIONS, TO HEAR WHAT MIGHT BE ON OFFER AND TO ASK QUESTIONS IN ORDER TO HELP CLARIFY HONG KONG'S FINAL ATTITUDE TOWARDS CTA EXTENSION. BUT WE RECOGNISED THAT, IN ABSENCE OF MANDATE, COMMISSION WAS NOT YET IN A POSITION TO BE SO SPECIFIC. NEVERTHELESS WE AGREED IN THE CIRCUMSTANCES TO CONTINUE ON AN INFORMAL BASIS WITHOUT COMMITMENT AS A PRELIMINARY TO LATER
SUBSTANTIVE TALKS.
3. ERNST CONFIRMED THAT COMMUNITY AS SUCH WOULD ADHERE TO ANY EXTENDED CTA AND THAT FUTURE NEGOTIATIONS WOULD BE CONDUCTED BY COMMISSION ON BASIS OF COMMUNITY MANDATE. HONG KONG WAS MOST DIFFICULT CASE BECAUSE OF ITS LARGE AND VERY UNEVEN PENETRATION OF EEC MEMBER STATES MARKETS. BUT COMMISSION WANTED TO BREAK VICIOUS CIRCLE, START TO GET FRENCH OFF THEIR EXTREME POSITION AND EASE THIS PROBLEM IN CONTEXT OF BRITISH ENTRY. HE THOUGHT
HONG KONG WOULD EVENTUALLY BE OFFERED AN ARTICLE 4 AGREEMENT WITH WHOLE COMMUNITY. BASIS COULD EITHER BE AVERAGE OF IMPORTS IN THREE YEARS 1967/9 WITH GROWTH, OR THE QUOTE EXCEPTIONAL UNQUOTE
/1969 PERFORMANCE
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