CONFIDENTI AL
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TO OTHER ''DONOR'' COUNTRIES' SCHEMES. AFTER ALL, WE HAVE ALWAYS
DMPHASISED THAT WE DO NOT SEEK VAST NEW TRADE ADVANTAGES
IN THE G P S BUT ONLY TO AVOID DAMAGING DISCRIMINATION AGAINST US.
La
ON THE OTHER HAND, WE MUST BEAR IN MIND THAT IF WE ARE EXCCUDED
ON A PARTICULAR ITEM BECAUSE WE HAVE DEMONSTRATED OUR ABILITY
TO SURMOUNT THE TARIFF, WE MAY SUFFER A CONSIDERABLE TRADE LOSS
IF DUTY-FREE ENTRY IS ACCORDED TO OTHERS BECAUSE THE COMPETITIVE
EQUILIBRIUM POINT MAY LIE BETWEEN.
5. THIS DANGER COULD BE AVERTED IF SOMETHING LIKE BARGER'S SUGG- ESTION WERE ADOPTED, AND WE WERE GIVEN PREFERENCE ONLY UP TO THE LEVEL OF EXISTING TRADE. IT WOULD HOWEVER BE NECESSARY TO ALLOW
FOR GROWTH ON THAT TRADE AND FOR AN EQUITY CLAUSE THAT WOULD
ENTITLE US TO SEEK MEANINGFUL CONSULTATIONS IF WE FOUND OTHERS
EXPANDING THEIR EXPORTS SUBSTANTIALLY ON A DUTY-FREE BASIS WHICH
WE, HAVING EXHAUSTED A DUTY-FREE QUOTA, WERE UNABLE TO SELL ADDITIONAL QUANTITIES OVER THE TARIFF IN THE FACE OF CONTINUING
CUTY-FREE ACCESS FOR OTHERS.
WE HAVE THEREFORE BEEN CONSIDERING BARGER'S SUGGESTION
IN RELATION TO OUR TRADE WITH THE U.S., FOR PRODUCTS WHICH
MEET THE THREE FOLLOWING CRITERIA:
(A) HONG KONG IS PRINCIPAL SUPPLIER SEMICOLON AND
(B) HONG KONG SUPPLIES MORE THAN 50 PERCENT OF THE U.S.IMPORT
MARKET SEMICOLON AND
(C) THE VALUE OF IMPORTS OF THESE ITEMS FROM HONG KONG EXCEEDS
U.S. DOLLARS 2 MILLION SEMICOLON
1.E. PRODUCTS IN RESPECT OF WHICH IT SEEMS THAT AT PRESENT WE
CANNOT CLAIM COMPETITIVE NEED'' BUT FOR WHICH WE SHOULD
/REQUIRE
CONFIDENTIAL
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