TNAG-0385-FCO40-431-Trade-relations-between-Hong-Kong-and-the-EEC-1974 — Page 26

26 NOV 1973

The Director

Commerce & Industry Department Fire Brigade Building

Hongkong

02/70 2334-0/1

24th November, 1973.

Dear Sir,

The undersigned associations whose interests are vitally affected by the policy of the European Economic Community to exclude Hongkong's textiles and footwear from the list of products entitled to the benefits of the Generalized Scheme of Preferences, wish to express their feeling of frustration and anxiety over the uncertainty created by the impending application of the patently discriminatory policy of the Community. From the reply received yesterday from the Secretary of State for Foreign and Commonwealth Affairs which you have transmitted to the undersigned Associations, the implication is clear that nothing can be done before the annual review due to be held sometime late next year.

But we have to point out that Hongkong's textile industry as a whole is being confronted, even now, with very difficult sales problems in major overseas markets, even if no further aggravation had been introduced by way of discrimination against its products that will inevitably result from the Community granting an advantage to Hongkong's strong and fast emerging competitors, such as South Korea, Pakistan, India, Thailand, Yugoslavia and Indonesia etc.

We

It must be stressed again that we are not seeking any special privilege, but merely asking that we not be discriminated against. simply cannot see any justification why we should be denied equality of treatment and be given a fair deal by the United Kingdom and hence by the Community.

This is especially important for Hongkong with respect to marketing textiles in the United Kingdom, as even what is now left of the Commonwealth Preference will begin to be phased out in 1974, and from 1st January 1974 we will face a reverse preference from the United Kingdom in its capacity as a member of the Community. It is easy to foresee that the resulting squeeze vis-a-vis the UK market will be especially onerous, and become practically punitive, if the Community's discriminatory measure is not changed in time.

After all, Hongkong in its position as a dependency of Britain would surely deserve some concrete measure of care and assistance in recognition of past as well as existing acts of cooperation in trade and finance which have turned out to have benefitted both sides.