TNAG-0332-FCO40-368-Visits-of-Secretary-of-State-for-Foreign-and-Commonwealth-Af-1972 — Page 186

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REASON TO BE THANKFUL FOR THE ENDING OF AN ANOMALY WHICH WAS

A MAJOR SOURCE OF FRICTION AND MISUNDERSTANDING IN THE WORLD,

AND IN PARTICULAR IN THIS AREA.

I AM GLAD TO SAY THAT SINO-BRITISH RELATIONS HAVE

STEADILY IMPROVED IN RECENT YEARS. BOTH COUNTRIES HAVE MUCH TO

OFFER EACH OTHER IN TRADE AND CULTURE. GOOD RELATIONS BETWEEN US

MUST BE TO THE BENEFIT OF ALL.

AND NOW A WORD ABOUT TRADE, WHICH IS YOUR LIFE. IT WAS A GREAT RELIEF THAT IT WAS POSSIBLE TO ACHIEVE SO QUICKLY

THE REALIGNMENT OF PARITIES OF THE MAJOR INTERNATIONAL CURRENCIES.

WITH EVERY WEEK THAT THE CONFUSION OF EXCHANGE RATES CONTINUED

THE TEMPTATION TO EACH OF THE MAIN TRADING NATIONS TO LOOK TO

ITS OWN DEFENCES TI MAN THE RAMPARTS AND RAISE THE DRAWBRIDGE

GREW. NOW THE AMERICAN SURCHARGE IS REMOVED AND THE FUTURE IS

BRIGHTER.

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HONG KONG, OF COURSE, STILL HAS TO FACE TRADE BARRIERS

AGAINST SOME OF ITS PRODUCTS. THIS IS TO SOME DEGREE A TRIBUTE

TO YOUR SUCCESS, I RECOGNISE THAT OUR RECENT DECISION TO REINTRODUCE

QUOTAS FOR TEXTILES WAS A DISAPPOINTMENT TO YOU. IT WAS A

DISAPPOINTMENT TO US THAT WE FELT BOUND TO TAKE THIS DECISION.

OUR HAND HOWEVER WAS FORCED BY THE EVIDENCE THAT WE COULD NOT

IGNORE THAT SOME OF OUR SUPPLIERS- AND HONG KONG WAS NOT ONE OF

THOSE CLOSELY CONCERNED- WERE PROPOSING TO FLOOD US IN THE SHORT

TERM BETWEEN NOW AND WHEN WE ANYHOW HAD TO ADOPT QUOTAS AS

MEMBERS OF THE E E C WITH GOODS IN SUCH QUANTITIES THAT ORDERLY

MARKETING WOULD HAVE BEEN IMPOSSIBLE. WE WERE FACED WITH THE

DILEMMA OF ANY CENTRAL GOVERNMENT THAT OWES A DUTY TO THE MANY

VARIED REGIONS FOR WHICH IT IS RESPONSIBLE. IT IS BECAUSE WE ACCEPT

OUR RESPONSIBILITY TO YOU THAT YOUR QUOTA IS MUCH THE LARGEST OF

ALL- AMMOUNTING TO TWO-FIFTHS OF OUR TOTAL IMPORTS OF COTTON

TEXTILES. WE SEE ALSO YOUR NEED FOR FLEXIBILITY, AND AFTER

VARIOUS DISCUSSIONS I AM HAPPY THAT WE HAVE BEEN ABLE TO MAKE

AN OFFER WHICH YOUR GOVERNMENT IS STILL CONSIDERING BUT WHICH I HOPE

YOU WILL FIND. YOU CAN ACCEPT. IT MAY NOT BE IDEAL FOR YOU OR

FOR US- NO COMPROMISE CAN EVER BE THAT- BUT I BELIEVE IT SHOULD BE

WORKABLE AND SHOULD MEET MOST OF YOUR NEEDS AND OURS.

BUT EVEN WHERE HONG KONG HAS TO OPERATE UNDER RESTRAINTS

IN ITS TRADE WITH OTHER COUNTRIES, A VAST AND PROFITABLE MARKET

STILL LIES OPEN TO YOU, AND IF THE CONTINUED EXPANSION OF YOUR

/EXPORTS

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