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Background Note
Type 1 +
From
Telephone No. & Exi.
Department
and subject to
The Secretary of State's discussion of Hong-Kens and the GFS with Mr Aichi/elicited the first firm pub- lic commitment by the Japanese to include Hong Kong,
Back qes. though this not toe from the cutset (1 August 1971 or without restrictions on certain sensitive exports. The Japanese also agreed to have talks with Hong Kong officials in Tokyo to I¤ngxaxniaиndurmánudingomandn clarify details of Hong Kong exports to Japan. However, the Japanese declared that it was premature to try to define what Mr Aichi had meant by "certain restrictions"
ques Int
2.
However, we can speculate that Japan would limit Hong Kong's preferential access on items such as textil- es and footwear. They would find a precedent for this in the EEC GPS, which excludes all dependent territor- ies from preferences on these items.
3. The United States attitude to Hong Kong in the GFS context is unclear but gives no cause for optimism. The Administration fears that it will have serious difficul -ty in getting its GPS legislation (not yet submitted) through Congress without alteration and curtailment.
·
It is unlikely to create further difficulty for itself by displaying generosity towards Hong Kong at a time of Congressional hostility to imports of low-cost Asian manufactures. The fact that textiles and footwear are not included in the US. GPS is a factor marginally help- ful to Hong Kong, but we can expect reluctance to give her other exports the advantage of preferences. While Japanese refusal to include Hong Kong would certainly is no guarantee of Hong Kong that Japanese (qualified) inclusion
clusion will encourage the
have led the US to follow suit, encourage the
J
USA to a similar step.
A
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