TNAG-0245-FCO40-281-Exports-of-textiles-from-Hong-Kong-to-Sweden-1970 — Page 136

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Mr. Wil

Textile negotiations between Hong Kong

and Sweden

I asked Mr. Kinnear to prepare the note below giving the background to the Governor's telegram at Flag H.

2. Unfortunately, there were faults on both sides. I think Hong Kong ought to have consulted us before committing themselves to talks of this nature. I think too that they ought to have consulted us about the tactics to be employed. It was their statement that in the Swedish consultations they intended to seek "combined limit for any cotton and equivalent non- cotton item where restraints on both are unavoidable" that particularly worried Mintech and the Board of Trade, coming as it did at a time when we were considering what to do about the American approach to the Japanese for comprehensive restraints. As you will see,arrangements were made for Mr. Carey to explain our difficulties to the Hong Kong Government. Mr. Murray was also briefed to speak on the matter.

Yes indeed 4 ray, the fin't on which I remonstrated,

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3.

The Swedes then made it clear that they were going to take a tough line and Hong Kong responded in a suitably robust manner. The next day we sent two telegrams. One to Hong Kong, of which we had a hand in the drafting, and the other to Sweden which we did not see until three days after it had gone.

We

should, of course, have been consulted about the latter telegram as well and I made this clear to Mr. Heath at the time.

4. As it happens, the negotiations have turned out with Mi Bottomley, as we expected they would and not as Hong Kong would

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have liked.

5. Incidentally, I am not at all sure that a settlement ad referendum would be a satisfactory way of dealing with negotiations of this kind. It seems to me that it would be very difficult for us to upset an arrangement entered into by Hong Kong and a third party as being in their own best interests.

(E. O. Laird)

Hong Kong Department

The Swedes wanted talks much later.

4 May, 1970.

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