TNAG-0299-FCO40-335-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 155

CONFIDENTIAL

DEPARTMENT OF TRADE AND INDUSTRY

1 VICTORIA STREET

LONDON S.W.1

147)

01 222 7877

enter & back Gömme

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12 May 1971

175

R G Britten Esq

Trade Policy Department

Foreign and Commonwealth Office Great George Street LONDON SW1

Dear Rac,

US GENERALISED PREFERENCES

RLY

144/5

REF.

Thank you for your letter of 11 May enclosing a draft to Ben Meynell. It seems to me that it would be helpful to him to point to some of the wider implications of what we heard from Samuels and from Cronk about reverse preferences.

2

I suggest that in paragraph 3, following the reference to Mr Rippon at the top of the second page, you replace the rest of the paragraph with the following:

RECEIVED IN REGISTRY No.51 13 mar 1971

AXICG/1

we

"If the Samuels proposal is mentioned to you,

suggest that you might say that it would be welcome to us if the United States said that they were prepared to drop their insistence on the declaration on reverse preferences by prospective beneficiaries and that, instead, they would review this question in 1975. The great advantage of this, as compared with the present US position, is that it would postpone until the third Yaounde Convention has to be negotiated the difficult problem facing the Commonwealth countries concerned in deciding where their main advantage lies. The problem is particularly acute for the Commonwealth Caribbean which would probably decline to meet the US condition because of their fear that by abolishing our reverse preferences they would put at risk the advantages they are seeking in the enlarged Community for sugar, bananas and citrus. Under Samuels' proposal they would be able to enjoy the largely presentational value of the US offer for a period and then make their choice in the light of knowledge of what they will get in the enlarged Community and of what long term benefits the US scheme may obtain for them.

It would also be easier for other Commonwealth countries, not being offered Association, to decide whether they can safely abolish our preferences when they should be able to see more clearly what other arrangements the Community will offer them. It would also be an acceptable solution to the Community. Indeed, both

CONFIDENTIAL

*.A of 1915.