TNAG-0243-FCO40-279-Conduct-of-Hong-Kong-commercial-relations-1973 — Page 54

Mr. Gaminara

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IBES

Commercial Relations with Hong Kong

The text of our draft despatch delegating authority to the Governor of Hong Kong to conclude bilateral agreements with other countries in respect of both cotton and non-cotton textiles was telegraphed to him for comment in our telegram No. 515. The Governor replied in his telegram No. 525 in which he made suggestions for a number of amendments, the main one being that, if authority is to be delegated to Hong Kong in the specific field of textiles, the same delegation should be made in respect of other commodities also.

2.

Sir Leslie Monson commented on the Governor's proposals in his minute of 11 August and in the light of those comments an amended draft despatch including a number of the Governor's amendments was sent to the Board of Trade and Mintech for comment.

3.

Mr. Dunnett of the Board of Trade commented on the revised draft despatch in his letter of 25 August from which it would appear that he had not fully understood the situation and a meeting was held on 2 September in Mr. Heath's room, at which both Mr. Dunnett and Mr. Gregory of Mintech were present, to discuss the situation.

The Legal Advisers have recommended that there should be two despatches for the purposes of the delegation. One would be intended for publication and would be on the lines of entrustment despatches issued to certain other colonial territories, (e.g. despatch of 16 February, 1967 to Antigua). The other would be a confidential despatch (i.e. the attached draft) for the information of the Governor and his advisers.

5.

It was agreed at the meeting on 2 September that it would be in order to recommend to higher authorities that the scope of the delegation of of authority should be extended to include other goods as well as textiles. Mr. Dunnett was at first doubtful regarding the advisability of this but it was pointed out that paragraph 9 of the draft despatch, as amended, stipulates that the Government of Hong Kong would have to keep H.M.G. informed about prospective as well as current negotiations on commodities matters and, if at any time Mintech or the Board of Trade considered that Hong Kong's proposed policy conflicted with that of H.M.G. it would be possible for H.M.G. to intervene.

6.

The Governor's amendments have been included in the revised draft with the exception of the suggestion that the words "in a form of words agreed with the Governor" should be inserted in paragraph 9 of the despatch; this would be an unnecessary addition which really means very little because, in the event of a conflict of views between Hong Kong and H.M.G., both

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CONFIDENTIAL