TNAG-0304-FCO40-340-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 33

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Hangkang Standard 10/12/71

UK quota move is a backward

step, says Kan

THE British decision to reimpose quotas on Hongkong's cotton textiles came under criticism from trade and industry leaders yesterday. Commenting on the British move, the chairman of the Trade Development Council, Y.K. Kan said the London action was "a retrogressive step."

Mr Kan said "it will create confusion among buyers and sellers by cutting across contracts made on the explicit understanding that the quota system would be removed on January 1."

Meanwhile, chairman of the powerful Hongkong General Chamber of Commerce, G.M.B. Salmon, pointed out that past experience tell a long story of the British Government saying one thing and doing another.

Talks

As far back as 1958, during the original negotiations leading to а voluntary limitation of textile shipments, the then Prime Minister himself asked Hongkong 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, he said.

Salmon

More recently, Mr said, the British Government "assured us in July 1969 and re-affirmed later that a 15 per cent tariff would replace quota controls on 1st January 1972. Hongkong industry and trade is now given only 22 days notice that these assurances are valueless."

Mr Salmon said the "distruptive effects of this sudden volie-face are bound to be serious," particularly for those firms who have already entered into firm contracts on grounds which they had every reason to believe was to be the new basis. 'They may not now be able

perform

contracts, he said.

Meanwhile, returning from

talks in London the Financial Secretary C.P. Haddon-Cave told an airport press conference last night that the "double form restriction" Britain has forced upon Hongkong would limit the flexbility of our cotton textile exports to Britain and damage the profitablity of

manufacturers.

He said the last minute decision by Britain was mainly aimed at protecting Britain's own textile industry.

"I am very disappointed that our

in long standing trade woven cotton textile with UK are now to be subjected to the double form restrictions," he said.

Hongkong, Mr Haddon-Cave pointed out, supplies only a third of Britain's imports which accounts for about 12 to 13 per cent of Britain's total market needs.

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