solving the inflationary problem inside Japan as a result of their Industries being export oriented and increasingly too sophisticated and costly to meet cheaper consumer demands. I fear, however, they are hardened to this kind of argument.
Having exhausted most of the arguments against exclusion by product, I asked if thought had been given to a sort of Australian 'competitive need' concept whereby periodic review with a view to reinstatement would be possible. I was told that this would be within the authority of the administra- tion and would not need further reference to the legislature.
16.
17. next.
We left it somewhat up in the air as to what happened But Wakefield has undertaken to keep up the pressure as and when it seems appropriate with a view
(a)
to getting a Japanese Government statement of intent on inclusion of Hong Kong;
and
(b)
18.
to resuming the dialogue with the Japanese on details once they have an indicative list of exclusions.
As an interesting postscript, I should record that Watanabe, Deputy Head of the China Division of the M.F.A. made his only contribution right at the end. It was a plea that no publicity should be given to the substance of our discussion and that press queries should be blandly sidestepped. I agreed.
WD/CS
G.
Copies: D.E.S.
A.G.
A.L.
A.V.
A.B.
(W. Dorward)
A. R. 18.6.71
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