TNAG-0300-FCO40-336-Entitlement-of-Hong-Kong-to-generalized-tariffs-preferences--1971 — Page 213

11

23

Taiwan is another matter. Although imports of eligible

manufactures are only 23 million, they are goods that compete

strongly with those of Hong Kong both in the UK and US markets.

[It is unfortunate for Taiwan that unlike South Korea, Ehe]is not

a member of the Group of 77. Ministers agreed in September 1970 that

if Hong Kong were excluded we could consider excluding South Korea

and Taiwan. Since both the 200 and USA will include South Korea

it would be difficult for us to do otherwise, but Taiwan, which

will certainly be included in the US scheme, is initially excluded

by the BBC; it would therefore be open to us to follow the EEC.

We may have a small amount of bargaining power with the USA and with

Japan (which also has investments in Taiwan) in return for the

inclusion of Hong Kong. In view of this and of Taiwan's competitiveness.

it seems better to exclude Taiwan initially and leave open the

possibility of inclusion if Hong Kong obtains a satisfactory deal.

Other Countries

770

*

24 The inclusion of mainland) China and her satellites does not

have to be considered as yet. Their attitude is not known. Only

if and when they claim similar preferences, which they would have

to do bilaterally, will we have to decide whether to include them.

The other donors mostly take the same view, but it is possible

that Japan will accord r preferences unilaterally to mainland

China.

A