TNAG-0301-FCO40-337-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 129

CONFIDENTIAL.

DRAFT SAVING DESPATCH

From the Secretary of State for Foreign and Commonwealth Affairs.

To the Governor, Hong Kong.

Your Saving Despatch No 28 of 8 January 1971.

Exports of cotton textiles to Britain: Post-1971 Arrangements.

1.

The meeting between your representatives and officials of the

United Kingdom Department of Trade and Industry and Foreign and

Commonwealth Office requested by you took placed in London on 1 February

1971. It was agreed that the matters discussed at that meeting should

be further considered by the UK Government before a reply was sent to your

Saving Despatch No 28. We are now in a position to reply to the points

which you raised.

2. We are grateful for the summary in paragraphs 3 to 6 of your Saving

Despatch of the findings of the Advisory Committee to the Hong Kong

Textiles Advisory Board on the likely effects of the United Kingdom's

new policy on imports of cotton textiles which is to be introduced on

1 January 1972. We note the Committee's references to the dependence

of some sections of the Hong Kong textile industry on the British market

and to their fears about the effect on their trade and profits of the

new tariff on imports of cotton textiles into the UK from the Commonwealth

Preference Area. We can appreciate this apprehension on behalf of the

particular firms concerned. But from the viewpoint of the industry as

a whole it perhaps ought to be balanced by a recognition of the oppor-

tunties that will exist in future for the industry to compete free of

quantitative restrictions in the UK market. We had earlier understood

that some sectors of the Hong Kong industry were looking forward to