TNAG-0237-FCO40-273-Trade-relations-between-EEC-and-Hong-Kong-1990 — Page 170

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1969 PERFORMANCE WITH ONLY TOKEN GROWTH AT BEST.

TOTAL WOULD

BE BROKEN DOWN BETWEEN MEMDER STATES ON BASIS OF EXISTING TRADE

BUT CATEGORISATION WOULD BE UNIFORM. WHEN ASKED WHETHER THIS

IMPLIED THAT EXPORT CONTROL WOULD BE CONCEDED BY FRANCE HE HEDGED

AND SAID THAT DETAILS OF ADMINISTRATION WOULD STILL NEED TO BE

NEGOTIATED WITH INDIVIDUA MEMBER STATES,

4. WE CHALLENGED THAT THIS BASIS WOULD NOT OFFER QUOTE INCREASED

EXPORT OPPORTUNITIES AND MORE FLEXIBLE CONDITIONS UNQUOTE TO

HONG KONG AS PROMISED IN CTC CONCLUSIONS BUT WOULD RATHER EXTEND

AREA OF RESTRICTION BY INCLUDING PRESENT LIBERALISED TRADE WITHOUT

EVIDENCE OF MARKET DISRUPTION. ERNST REPLIED THAT EEC

WAS ALREADY TAKING MORE FROM HONG KONG THAN FROM ANY OTHER EXPORTING

COUNTRY AND THAT THIS WAS A SOURCE OF DIFFICULTY FOR THEM WITH

OTHER LDCS.

FURTHER QUESTIONING REVEALED, HOWEVER, THAT HE WAS SERIOUSLY OVER-ESTIMATING 1969 TRADE BY WORKING FROM EXTRA- POLATED IMPORT FIGURES FOR FIRST NINE MONTHS WHICH SHOWED A 28%

INCREASE OVER 1968. WHEN WE SHOWED FROM HONG KONG EXPORT FIGURES

FOR WHOLE YEAR THAT GROWTH WAS MORE LIKE 5-6% HE CONCEDED THAT

COMMISSION WOULD NEED TO THINK AGAIN.

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WE ALSO HAD LONG DISCUSSION ON SWING BETWEEN SPECIFIC CATEGORIES. DESPITE SEVERAL PREVIOUS EXPLANATIONS, COMMISSION HAD APPARENTLY NOT YET TAKEN ON BOARD THAT LIMIT WAS ON QUOTE SWING

IN UNQUOTE AND THEY MAY REVISE THEIR THINKING ON THIS IN

RELATION TO PROVISIONS OF MODEL AGREEMENT. ERNST'S OWN THINKING

SEEMED TO BE MOVING IN DIRECTION OF 5% CARRYOVER AND ANTICIPATION AND PERHAPS, AS A RESULT OF OUR EXPLANATION, 5% SWING.

6. IN REPLY WE SAID WE COULD GIVE NO INDICATION OF WHETHER HONG

KONG WOULD BE PREPARED TO CONSIDER NEGOTIATION ON ABOVE BASIS. IT WAS AGREED THAT FURTHER CONSULTATIONS WOULD BE HELD IN MARCH BY WHICH TIME COMMISSION WOULD HAVE RECEIVED SOME MANDATE FROM COUNCIL. WE MADE IT CLEAR THAT HONG KONG WOULD REGARD THESE AS THE SUBSTANTIVE CONSULTATIONS ENVISAGED IN THE CTC CONCLUSIONS BUT NOT AS THE PRELIMINARY TO A FORMAL ARTICLE 4 NEGOTIATION.

17. AT END OF

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