given no reason to assume that the Heads of Agreement provision
on growth would not continue to apply.
3.
The Board of Trade representative, on leaving Hong Kong,
left a message with a member of this Office who had also atten-
ded the talks, offering an annual growth rate of 3%. Hong Kong,
however, consider that the 6% provision in the Heads of Agree-
ment should apply in this case. It has been argued that
because Hong Kong telegraphed acceptance to New Delhi (where
the Board of Trade representative had then gone) they also
accepted the belated "offer" of a 3% growth rate. Hong Kong
deny this. They argue that the package was that agreed in
discussions with the Board of Trade representative, which they
only accepted because it was a considerable cutback on their
previous level of trade on the basis that the higher growth
provisions in the Heads of Agreement continued to apply.
4.
Hong Kong were first to record their understanding of the
agreement, which they did more than a year ago in a despatch
clearly reflecting the Governor's hard feelings about the Agree-
ment as a whole, and which also placed on record that Hong Kong
saw no reason to alter the growth factors in the Heads of Agree-
ment.
5. It was three months before a reply was sent to the Gover-
nor's despatch. This reply contained HMG's first formal pos-
itive statement about growth, to the effect that there could
be no question of allowing a rate above 3%. It was argued
that because Portugal and India had not been allowed any growth
it was unthinkable that Hong Kong should be allowed to claim a
possible 6% growth under the Agreement. It is, however, dif-
/ficult
No comments yet.
Private notes are available after approval.