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as part of a package deal not to challenge the rules of origin disqualification on part of the package. If it went uncontested, however, Hong Kong would be stuck with it in the US market too. In conclusion it was agreed to probe the C thinking behind this group of items, not ruling out the possibility of a genuine misapprehension or mistake on their part.
9.
On paragraph 3 (iv) of Codel 229, the Governor said that Hong Kong could not object, though he hoped surveillance could also work both ways, restoring preferences where damage was caused. Mr. Hannay suggested that the list was mainly a presentational device whereby the Commission aimed to soothe the French.
Approaches to Japan
T
10. Mr. Britten said that the point at issue here was whether we could now put concrete proposals to the Japanese as a means of keeping them in play.
while The Governor favoured this course, Mr. Lam feared it might provoke a Japanese negative prematurely; he would prefer to sound them out at the OECD Trade Committee
next week before we made any move. r. Jones reminded the meeting
that the Japanese might implement their GFS sooner than other donors (promptness mollifying the less developed countries for the meagreness of the offer itself) and that little time was left for our approach. In any case, we might assume that the Japanese would exclude Hong Kong from their offer simply to ensure that the US did likewise, so damaging a rival in the American market. Discussion of possible Hong Kong retaliation against Japan was inconclusive, and the Chairman suggested that whatever proposals we put to the Japanese for partial inclusion of Hong Kong were likely to delay rather than provoke the expected negative decision. Subject to soundings at the Trade Committee, a formula should be
put to the Japanese soon.
Reverse Preferences
11.
Sir J. Cowperthwaite raised a point "in the gift of HMG";
that of the reverse preferences granted by Hong Kong to the UK (on tobacco, liquor etc). As Commonwealth preference would disappear after ELC enlargement, Hong Kong would wish to use her tariff
position now to offer the donor countries some quid pro quo. Mr.
Jones pointed out that the American condition on the phasing out
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