TNAG-0304-FCO40-340-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 151

NNNNLO

HMLO - TAPE

24

DENDRITE LONDON

9/12/71.

134/€

TELEX FROM THE MANAGER DODWELL HONGKONG

9th DECEMBER 1971

MANAGERIAL (JAH)

HKDEN715 JHH FOR INFORMATION H.K. ASSOCIATION FOLLOWING STATEMENT

ISSUED BY CHAIRMAN H.K. GENERAL CHAMBER TODAY,

QUOTE THE HISTORY OF CONTROLS ON SHIPMENTS OF COTTON TEXTILES

TO THE UNITED KINGDOM SEEMS TO BE ONE LONG STORY OF THE U.X.

GOVERNMENT SAYING ONE THING AND DOING ANOTHER. AS FAR BACK AS

1958, DURING THE ORIGINAL NEGOTIATIONS LEADING TO A VOLUNTARY

LIMITATION OF TEXTILE SHIPMENTS, THE THEN PRIME MINISTER HIMSELF

ASKED HONG KONG TO GIVE SUCH A VOLUNTARY UNDERTAKING TO PROVIDE

A PERIOD FOR NECESSARY ADJUSTMENTS ON EITHER SIDE. THIS PERIOD

OF ADJUSTMENT HAS REMAINED WITH US FOR 12 YEARS. MORE RECENTLY HMG

ASSURED US IN JULY 1969 AND RE-AFFIRMED LATER THAT A 15-0/0 TARIFF

WOULD REPLACE QUOTA CONTROLS ON 1ST JANUARY 1972. THE HONG KONG

INDUSTRY AND TRADE IS NOW GIVEN ONLY 22 DAYS NOTICE THAT THESE

ASSURANCES ARE VALUELESS. THE DISRUPTIVE EFFECTS OF THIS SUDDEN

VOLTE-FACE ARE BOUND TO BE SERIOUS, PARTICULARLY FOR THOSE FIRMS

WHO HAVE ALREADY, IN GOOD FAITH, ENTERED INTO FIRM CONTRACTS ON

GROUNDS WHICH THEY HAD EVERY REASON TO BELIEVE WAS TO BE THE NEW

BASIS SUCH CONTRACTS THEY MAY NOT NOW BE ABLE TO PERFORM. WE

WILL HAVE TO AWAIT THE OUTCOME OF THE FURTHER TALKS TO BE HELD IN

JANUARY BEFORE WE CAN ASSESS THE FULL EFFECTS OF THIS ON OUR

ECONOMIC PROSPECTS. MEANWHILE, WE CAN ONLY REGARD WITH CONSIDERABLE

MISGIVINGS THE RELIABILITY OF ANY FUTURE ASSURANCES FROM HMG, LET

ALONE THEIR EFFECTIVEMESS IN PROTECTING HONG KONG S INTERESTS UNDER

THE GATT AND IN OTHER INTERNATIONAL NEGOTIATIONS UNQUOTE.

PGW.

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