ficult to accept that, should the Indians (or Portuguese) bec-
ome aware of any growth provision, be it 3% or 6%, their pro-
testations would not have the same substance and present the
same difficulties.
6. But such considerations must be set against the positive
undertaking in the Heads of Agreement. It is agreed that the
negotiations were conducted within the framework of the Agree-
ment (Mr Carey's letter of the 5th August, 1969 to Mr Moreton).
The Agreement provides for growth levels and it also provides
that changes must be by mutual consent. The original UK Aide
Memoire did not state that no growth could be allowed; it
stated merely that HMG would "find it difficult to contemplate"
growth. There was no substantive statement of the UK position
on growth made at the negotiations nor any discussion of growth
only the untidy sequence of events described above which
allows both parties to believe that their interpretation is
the correct one. In the absence of any mutual agreement, are
we not bound to fall back on the growth rate provisions in the
Agreement?
7.
A
There are other arguments to support this solution.
strong argument in Hong Kong's favour is a moral one (but one
which the Colony has not advanced). We know, and the Board
of Trade do not contest, that HMG's representative at the neg-
otiations actually succeeded in restraining Hong Kong at a
level of exports which, to use his own later words, "gave away
only 40% of the margins set by the negotiating limits". It
would be arguable whether this was in any case a proper appr-
oach to trade negotiations with a dependent territory for whose
/welfare
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