TNAG-0298-FCO40-334-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 130

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Thank you very much for sending the extract from the record of the meeting between Jim Bottomley and Hirahara. are most grateful to Jim Bottomley for his patience and determination in representing Hong Kong's position. As you will know from our recent discussions in London I had rather expected that the talks with the Japanese would take place some time this month: it is, therefore, disappointing to find that Hirahara is now thinking in terms of April or May. My fear is simply that the longer this question drags on the more likely it is that the Japanese will become firm in their attitudes towards Hong Kong and that in these circumstances it might be difficult to change entrenched views at any meeting with them. This would be a pity as I believe in these circumstances they could well exclude us from some parts of their Generalised Preference Scheme which would be neither to their benefit nor of course to ours. I am thinking in particular of various sectors of the textile trade where we are not in competition with the Japanese but where they rely heavily on importing from Hong Kong. Wakefield is of course well aware of our desire to meet with the Japanese as soon as practicable and I know that he loses no opportunity of pressing for an early meeting.

I am most grateful to you personally for the help and advice you gave us during our recent discussions in London. On the whole, news of the E.E.C. offer was very well received by the business community in Hong Kong. John Cowperthwaite still feels, I believe, that we might have obtained a rather better deal if we had been directly involved in discussions with the E.E.C.: this may well be true, but I remain convinced that, in the circumstances at that time and at that stage in the negotiations, it was very much in our interest that Britain acted as she did and accepted the offer on our behalf.

As you appreciate, now that we have been recognised by a major trading bloc as a beneficiary (albeit on a limited basis) within the U.N.C.T.A.D. G.P.S. the hope and expectation is that others will soon follow the E.E.C. lead. But excellent though this would be, our major fear remains that there still might be discrimi- nation in favour of our close competitors: in this regard the position of Taiwan causes us the most concern. You will recall that I made this point very strongly not only at our official meetings but also to the Minister (Anthony Royle) when we met him after our discussions with Roy Denman and company. On that occasion the Minister not only expressed his sympathy with the Hong Kong view, but also stated his determination to ensure that everything possible would be done to prevent discrimination against Hong Kong especially in favour of Taiwan. Indeed the Minister sought the views of David Hannay who stated (somewhat to my surprise as he gave no such specific indication in our earlier lengthy discussions) that the

/E.B.C.