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W(8)L 51-7406
Community
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CONFIDENTIAL
exclude Hong Kong on the grounds that they
would otherwise have to take a disproportion-
ate amount of the burden. Hong Kong's accep-
tance of voluntary control could conceal
the extent of this restriction from the
Americans, and if necessary similar voluntary
control could be offered to the Americans.
It should be noted that Hong Kong would not
bo asked to apply a voluntary control on the
quantity of her exports but merely on the
proportion of them that would enjoy duty-
free entry.
17. A further question on the UNCTAD Freference
side, which might be raised with Hong Kong
officials, is one that is of more concern to
HMG than to Hong Kong. It is thet, following
the enlargement of the community and the
adjustment of the community's Preference
Scheme, with an automatic expansion in the
size of the community's tariff quotas on
sensitive items, there are many anxieties
on the Community side that with Hong Kong's
inclusion, even under a limited formula,
there would be a very large increase in duty-
free exports from Hong Kong to the Community.
These anxieties could be soothed if NG
indicated a willingness to accept in the UK
a substantial proportion of the increased
duty free quota which Hong Kong would have
in an enlarged Community. The Community
/point out
CONFIDENTIAL
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