TNAG-0240-FCO40-276-Entitlement-of-Hong-Kong-to-generalised-tariffs-preferences--1970 — Page 232

CYPHER/CAT A

PRIORITY WASHINGTON

TELEGRAM NUMBER 3169

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J

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TO: FOREIGN AND COMMONWEALTH OFFICE 26 OCTOBER, 1970.

CONFIDENTIAL

NEUTRAL

ADDRESSED F.C.0. TELEGRAM NUMBER 3169 OF 26 OCTOBER 1970 REPEATED FOR INFORMATION TO UKDEL EEC BRUSSELS, UKMIS GENEVA, TDO NEW YORK AND HONG KONG AND SAVING TO TOKYO AND OTTAWA,

MY TELEGRAM NUMBER 3157: U.S. JAPANESE TALKS ON TEXTILES, THE STATE DEPARTMENT REGARD IT AS A HOPEFUL SIGN THAT THE PERSONAL PRESTIGE OF THE JAPANESE PRIME MINISTER AND OF PRESIDENT NIXON IS INVOLVED TO SOME EXTENT IN SECURING A SUCCESSFUL OUTCOME TO THE TALKS. SATO IS SAID TO HAVE INSISTED THAT THE GUIDANCE TO BE GIVEN TO THE PRESS AFTER HIS MEETING WITH THE PRESIDENT SHOULD MAKE IT CLEAR THAT THE INTENTION NOW IS TO NEGOTIATE A SETTLEMENT, NOT JUST TO CONTINUE DISCUSSIONS.

2. OUR IMPRESSION FROM CONTACTS WITH THE JAPANESE IS THAT THERE WAS NO DETAILED PREPARATION OF THE BASIS FOR A SETTLEMENT BEFORE

THE SATO VISIT AND THAT THE KEY QUESTIONS OF THE DURATION OF AN AGREEMENT, THE EXTENT OF COVERAGE AND THE POSSIBILITY OF SHIFTING BETWEEN CATEGORIES HAVE NOT BEEN DEALT WITH.

WITH. THE JAPANESE EXPECT

TO BE ABLE TO GO SOME WAY TO MEET THE AMERICANS BECAUSE ARRANGEMENTS ARE BEING MADE BY THE JAPANESE GOVERNMENT TO COMPENSATE THE TEXTILE INDUSTRY FOR LOSSES IT COULD SUFFER UNDER AN AGREEMENT, BUT ACCORDING TO SOURCES HERE THE INDUSTRY MAY CONTINUE TO RESIST

MAJOR CONCESSIONS.

*

HILKG/H.

/ 3.

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