TNAG-0385-FCO40-431-Trade-relations-between-Hong-Kong-and-the-EEC-1974 — Page 156

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may regard this arrangement as fair for themselves. for the United Kingdom our own alignment with the Community's GSP means that we will be expected to discriminate against our own dependency in respect of textiles and footwear and in favour of many of Hong Kong's strongest competitors, some of whom have been admitted to the GSP since the enlargement negotiations. This is an intolerable situation for us. At the time of the enlargement negotiations Mr Rippon said that it would be our continuing concern to avoid discriminating against Hong Kong. Under the present scheme, this discrimination will begin from the moment we align with the GSF on

1 January 1974. The only way to avoid this would be to admit Hong Kong now to the GSP on textiles and footwear. We would urge our partners to examine this possibility carefully and sympathetically. But if in the end this cannot be agreed we give notice that we will insist on changes to remove discrimination against Hong Kong in the course of the first annual review."

5. Perhaps you would let me know whether Mr Amery will be briefed to speak accordingly in the EUM? We will also need to consider how we can let it be known in Hong Kong that we have put to the Council of Ministers this condition on our alignment. We must do so if we are to avoid severe political damage.

19 October

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Sir D Watson

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Hong Kong & Indian Ocean Department

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