TNAG-0250-FCO40-286-Discussions-on-EEC-negotiations-between-officials-of-Hong-Ko-1970 — Page 203

NOTHING TO BE WRITTEN IN THIS MARGIN

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1

CONFIDENTIAL

Annex 1(420(70)41)

is not attached to

a Paper on Hong Kong's position as regards

our IC negotiations, prepared by the Working

Group on Europe for Ministerial considera-

tion. Attached as Annex II to the brief is

a description of Hong Kong's position in

the draft; perhaps particular commodities and their relationship the ITI would be able

to compile Annex to the CT.

>.

Paper

The conclusions of the Working Group

are:

(1) Hong Kong's rapid development in recent

years, which has more than kept pace

with her fast increasing population,

has been led by exports of manufacturers,

especially textiles. She is, however,

now beginning to lose her competitive

saventage because of increasing wages,

the second highest in Asia;

(11) Hong Kong's economy is resilient, and

- adeptable within limita, and she could

probably face Britain's imposition of

the CET against her;

(iii) But it would be more serious if she

were excluded from the UNCTAD Generalised

Prefermees Scheme and the developed

countries gave proference to her compe-

titors. We should, therefore, continue

our efforts to ensure that the USA, the

100 and Japan formally give her the

benefit of generalised preferences,

even at the price of some discriminatory

/limitations

CONFIDENTIAL