TNAG-0304-FCO40-340-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 143

CONFIDENTIAL

8.

Mr Haddon-Cave said that he understood this situation, but

Hong Kong's textile industry lived by its profitability and must

have the freedom to maximise this. For tariffs to be imposed on

top of an archaic quota system placed the Hong Kong textile industry

in a straitjacket. It was true that the real growth in national

product in Hong Kong in the 'Sixties' had been between 71 and 91%

(compound) and as much as 11% in 1969-70. But it had to be

remembered that the minimum to maintain the momentum of the

economy was between 6-7% and the Colony was concerned at its

current trade performance. The American Agreements on non-

cotton textiles would lead to further slowing down in growth and

for this reason Mr Haddon-Cave had found it hard to be told that

one of the reasons for the change in British policy was the

American Agreements.

9.

The meeting concluded at 17.25.

Commodities Department

FORELUN AND COMMONWEALTH OFFICE

7 December 1971

Distribution: Mr Bottomley

Sir L Monson

Mr Keeble

Mr Laird

Commodities Department (4)

3

CONFIDENTIAL