TNAG-0342-FCO40-378-Effects-on-Hong-Kong-of-long-term-policy-for-textiles-in-int-1972 — Page 33

Choo ex

Mines.

CONFIDENTIAL

FONDATE

conriza' tho Luyt

99

Miss J Elliott CRE 1

Department of Trade and Industry

1 Victoria Street

LONDON S W 1

REG YN51

1ÝMOV 1972

HICKOS

10 November 1972

V

9912

HONG KONG'S FUTURE STATUS IN GATT

(100

As foreshadowed in our telegram No 618 of 6 November, the Ambassador called on Mr Long on 8 November for further discussion of the proposed "two flags" solution to the problem of Hong Kong's representation in GATT after 1 January. He was accompanied by Eric Ho and Gerry Pearson.

2. It was immediately clear that, as Gardner Patterson had warned us, Long had strong objections to the idea; he believed that it could set a dangerous precedent (citing in passing the bazarre possibility that Argentina might one day ask to set up a flag for the Falkland Islands) and preferred to avoid any such innovation unless it had very clear advantages. As to this, he maintained that if there were no disagreement between the UK and the EEC about the putting of Hong Kong points from the UK delegation, he could see no advantage in the second flag. He emphasised, as Patterson had, that it was entirely within the UK's GATT rights to raise any points in GATT on behalf of Hong Kong and that no other contracting party had any right to object. But he recognised that if there were disagreement between the UK and the EEC, a new situation would be created.

3. The Ambassador said that our next step would be to discuss the question with the EEC, and reserved the right to come back to Long on the "two flags" point if we met difficulty if, for example, the EEC were to insist that the Hong Kong spokesman should be clearly identified within the UK delegation. Long accepted this. It was also agreed that if we thought it desirable, the Ambassador might write Long a letter, for circulation to contracting parties, clarifying the UK intentions with regard to Hong Kong's position after 1 January.

4. Following this meeting, Adrian Buxton and Gerry Pearson took advantage of Mr Luyten's presence in Geneva to have a preliminary and private discussion of the question with him and Jagstaidt, the representative here of the EEC Council Secretariat. They ventilated the position in the most general terms, making no mention of the "two flags" possibility and merely stating as a fact that as from 1 January the UK proposed to continue the present arrangement whereby they spoke for Hong Kong in GATT through a Hong Kong spokesman within the delegation, who would identify himself as such when speaking. They also explained that, particularly in view of some apparent uncertainty among other delegations in Geneva about future arrangements for Hong Kong, it was proposed that the Ambassador should write to Long to confirm the position

A first draft of what he has in mind to say is enclosed). Luyten

CONFIDENTIAL