TNAG-0299-FCO40-335-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 66

CONFIDENTIAL

-3-

Other Dependent Territories

8

The United States have claimed developing status on behal of their dependencies and we would therefore expect that she has no objection in principle to including within her scheme all our dependent territories, apart from Hong Kong. Japan however is still making difficulties about including any dependent territories and it would be useful to have confirmation that the United States have no intention of doing likewsie.

JAPAN

9 Following earlier representations, we had believed that we had overcome the Japanese reluctance to include Hong Kong and our other dependencies. Mir Sato stated in the Diet on 23 March that Hong Kong was "not unsuitable" for inclusion. But the Ministry of International Trade and Industry have now obtained agreement from the other Ministries that our dependencies should be excluded from the scheme at the start and that their case should be reviewed in the course of the

following year. This recommendation will go to the Japanese Cabinet on 20 June. It is intended that the Japanese scheme should come into effect on about 1 August.

10 This ners given to our Embassy by the Ministry of Foreign Affairs without explanation, is particularly surprising in view of the message which the Prime Minister had sent to ir Sato (a copy is attached). Our Embassy has been told that none of the Ministries ruled out the possibility of a favourable decision on Hong Kong next year but this is of course not good enough. Only a favourable decision now would be likely to influence the Americans. We have explaine i the reasons for including Hong Kong on a number of occasions and we are equally concerned that our other dependent territories, which are undeniably among the least developed parts of the world, should not be excluded. Representations to this effect are being made to the Japanese Foreign Minister by the Foreign Secretary and by our Secretary of State during the Anglo-Japanese Ministerial consultations on 10/11 June. The Prime Minister's message and the concern that will be expressed to ir Aichi might be conveyed to the Japanese

· representatives in pretty strong terms.