TNAG-0345-FCO40-381-UK-and-Hong-Kong-talks-on-cotton-textiles-1972 — Page 122

CONFIDENTIAL

で

COTTON TEXTILES:

DISCUSSIONS WITH HONG KONG

Meetings on 13 and 14 January 1972

1. My minute of 13 January. At the briefing meeting referred to in paragraph 7, Mr Ridley said that the two propositions made by Hong Kong could create the following difficulties:

2.

(i)

(ii)

significantly better the trading position of Hong Kong (which was already very favourable in comparison with other overseas suppliers);

cause requests from other suppliers for similar treatment which we could not meet within the restraints imposed by the Ministerial decision;

(iii) would be extremely difficult to explain, and defend,

to Lancashire and importers;

(iv) (on the EEC proposal) could cause difficulties for

the future harmonisation with the EEC;

(v)

would put an intolerable strain, at the wrong time, on the resources of the DTI.

Mr Ridley returned to the foregoing view on a number of occasions but finally we got down to considering the EEC proposition (it was generally agreed that the second Hong Kong proposal had so many demerits that none of the other parties involved would ever accept it). After considerable discussion, the DTI finally accepted that with certain modifications the Hong Kong EEC proposal provided a basis for further discussion, and, if the figures ultimately put into the blanks were right, might be something that could be recommended to Ministers, British industry, and for discussion with the EEC. The broad lines of this alternative approach were:-

(i)

(ii)

(iii)

to make no change to Groups I and II;

agree to some later put at 10 per cent_7 upswing from Group Ito Group IV;

(for presentational reasons with Lancashire) stick to the categories in Group III;

(iv) to maintain our offer to combine Groups IV and V [it

was later agreed that this would include a basket proposal_7;

(v) to accept the Hong Kong suggestion of six EEC type

categories for Group IV provided that some restraint mechanism was shown for woven gloves, towels, bed linen and sheets;

CONFIDENΤΙΛΙ,

/(vi)