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possible interpretation, requires the territory concerned to be deemed to be a contracting party. This would, I understand, raise questions about possible reactions by the Chinese peoples' government.
6.
No doubt Hong Kong would use discretion when exercising such extended powers. But I would have thought we would wish to keep under control the extent to which for example Hong Kong spokesmen are let off the leash, not only the GATT Cotton Textiles Committee but in all other GATT bodies, and given freedom e.g. to harass the E.E.C. on all matters where E.E.C. restrictive practices may affect Hong Kong.
7. The political desirability of making as large a gesture as possible to Hong Kong is understandable, but it is not clearly in Hong Kong's own best interest. When Hong Kong has to negotiate with the E.E.C., it might be that her position would actually be weaker if it had been publicly stated that even outside the field atine stage of textiles she had full authority to negotiate i.e. stood on her
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For the foregoing reasons it would seem on balance desirable to confine to textiles the proposed delegation of authority.
9. The other point which I suggest needs careful attention is whether we can really accept the Governor's request that Hong Kong will only be overruled after the issue in question has been put to Ministers "in a form of words agreed with the Governor". I do not see that we can agree that any submission to Ministers in such a situation must be cleared with the Governor. I would have thought to have the words now drafted in the Despatch implies that we think the Governor may have some grounds for the suspicions which he has evidently cherished in the past that his views have been distorted by officials in transmission to Ministers. I would have thought that any such implication was unacceptable.
That is, however, a point for the Foreign & Commonwealth Office rather than the Board of Trade. The essential point for us is that we must be able to put the matter to Ministers as we see it, whether or not this is accompanied by whatever form of words the Governor chooses to have submitted alongside. In short, the previous version of the Despatch on this point is far preferable, and we would accept your re-draft only on the understanding that what I have described as our essential point is safeguarded.
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10. One final point. The opening words of Para: 7 as drafted ("in respect of United Kingdom import policy") do not do full justice to the fact that in tariff matters Hong Kong will enjoy Commonwealth preference. It might be sufficient to substitute for the words "import policy" the words "controls on imports".
11. I am sending copies of this letter to Meeres in the Ministry of Technology, in case Divisions of that Ministry other than those concerned with textiles have views, as well as to Gregory in the same Ministry.
Your
Denzil Jana
DI Dunnett
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