TNAG-0303-FCO40-339-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 116

Sir L Monson

COTTON TEXTILE IMPORTS

CONFIDENTIAL

Seen by bin Lade. Han

EL

29

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1. I understand that this matter may not go to Cabinet after all since the Secretary of State is seeing Mr Davies at 2.30 pm on Monday. It appears that the debate may be held on Tuesday since the Opposition have asked for it and the Whips may agree. (The Rhodesian debate is on Wednesday). Mr Hale thinks that in the absence of Mr Bottomley and Mr Keeble he will probably have to be present when the Secretary of State sees Mr Davies. He wondered whether we wanted somebody to be there to speak on behalf of Hong Kong. I think it would be most helpful if you could go.

2.

Mr Keeble's recommendation is at paragraph 7 of his submission of 25 November (copy attached). We in the Department fully agree with this.

3. The answer to the argument that Hong Kong will not suffer under the DTI proposals is that while the larger companies will probably be able to live with the proposed arrangements some

More of the smaller concerns will almost certainly go under. important, these restraints coming on top of the restraints recently imposed by the Americans and the difficulties Hong Kong has in obtaining access to other markets could lead to a loss of confidence in the future of the Hong Kong economy generally.

4. If it is decided that quotas must be imposed it is particularly important that Hong Kong should be given an

The Governor Opportunity of discussing the problem with us. will have to consult his Executive Council and also the Textiles Advisory Board. Hong Kong bitterly resented the way the Americans recently imposed restrictions on imports of non-cotton textiles. I fear that if we were to present the Colony with a fait accompli on cotton textiles our action would arouse even greater bitterness, the more so because Britain as the metropolitan power would be expected to have a higher regard for the interests of the Colony.

26 November 1971

cc Mr Hale (Commodities Dept)

Maria

E O Laird

Hong Kong Department

CONFIDENTIAL