TNAG-0299-FCO40-335-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 24

whether it was worthwhile making any arrangements

with Britain at a time when Britain seemed likely to enter the Common Market and any offer which she

had previously made would lapse.

Mr.

Sanders said that we had noted a marked

upsurge in our imports from Japan in the first

quarter of this year. If this continued we should

want to see a corresponding rise in our exports to

Japan. This should be helped by measures of

liberalisation which Japan had carried out or

promised.

We were looking forward to the

liberalisation of chocolate biscuits and sugar

confectionery which we understood had been promised

for later this year.

Mr Sanders stressed that we should like to see

the reductions in tariffs which we had requested.

the These had been a key element in/package which we had

put forward welcoming the cuts which Japan had made

unilaterally. He wondered if similar cuts could not

be applied to the tariffs on whisky and wool, which

were high for a country with a high balance of

payments

We understood Japanese preoccupations about

Britain's entry into the EEC. If our negotiations

for entry succeeded, ultimately the decisive factor

for Anglo-Japanese trade would be the arrangments reached between Japan and the Commission.

had

We should

like to know what progress Japan/made. In our view

the right line for Japan was to continue to open her

own markets: to seek the removal of restrictions by

other countries against Japan; a proper exchange rate;

and provision for friendly discussion.

CONFIDENTIAL