TNAG-0341-FCO40-377-Effects-on-Hong-Kong-of-long-term-policy-for-textiles-in-int-1972 — Page 12

RE.C

REGISTRY M

25 JUL 1972

никол 8

А ірілі ато way y Luling it

CODE 18-71

HONG KONG TEXTILES

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训

7

12. Ihr Li

21.

V.R.

1 19/7.

تقادها

Mr Eric Ho (Hong Kong Government) called at his own request on Mr P W Ridley on 14 July 1972; he was accompanied by Mr Sellars (Hong Kong Government Office: London). Also present were:

Miss Lowne

CT Divn.

Mr Hope

#1

Mr Pownall

##

(FCO)

Mir Hale

Mr Hazel

Mr Goodfellow (FCO)

Mr Ho was in London for meeting with Mr Jurich of the US State Department about the dispute between the USA and Hong Kong over the licencing of Hong Kong exports of maf textiles to the US. In view of differences of view between the US State and Commerce Departments the meeting, aimed at finding some basis of settling the dispute, was being conducted very much in private and without a number of US interests being aware of it. Mr Họ did not elaborate on the progress of the dispute but was clearly concerned that a basis should be found for agreement and that both sides should avoid legal action by US importers which would force the whole issue into the Courts.

Progress of the GATT textile study, which had been under discussion in Geneva on 10 and 11 July, was reviewed. Both the Hong Kong and UK Governments were reasonably content with the progress made. HMG in particular regarded the study as a platform for considering the development of the GATT Long Term Textiles Agreement rather than an end in itself, thus within limits we did not mind too much about the mechanics of the study's progress. There had been support among a number of developed countries for the US proposal that a steering group should be established to oversee the study's direction. Most under-developed countries, especially India, were opposed to the idea since they would be excluded from it. Hong Kong appeared to be mildly in favour of a steering group and expected to be invited to serve if the group was formed. M.Long had clearly decided on his own objectives and had succeeded in preventing any attempts by delegations to thart them. He had not been impressed with the need for a steering group and took the line that, if the GATT Secretariat needed specialised assistance, they would ask for it. Mr Ho expressed some doubt about the level of textile expertise in the Secretariat. Mr.Ridley commented that, although the UK had no strong views either way over the formation of a group, we would need to ensure the Delegation in Geneva kept us advised of developments.

Mr Ho asked about progress over our work on new conversion factors for cotton textile quotes which were needed for alignment with the EEC's quota system. He was given a copy of a letter on this subject which had just been prepared and was awaiting transmission to Hong Kong. He commented on the difficulties of considering garment quotas in terms of metric tons rather than square yard equivalent. The conversion was necessary to align with an overall EEC system but for a variety of purposes we would still need to consider trade flows in terms of numbers of garments or square yard equivalents.

Mr Ridley disclosed in confidence that we expected soon to approach the Hong Kong Government with a request for restraints on exports to the UK of polyester/cotton fabrics and made ups. Mr Ho expressed gratitude for

advance warning and attempted to score a few quiok points over the strength of our case for restraints in this area.

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