TNAG-0386-FCO40-432-Exports-of-non-cotton-textiles-from-Hong-Kong-to-the-EEC-1973 — Page 122

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Department of Trade and Industry Chemicals & Textiles Division

Millbank Tower Millbank London SW1

Telex 263171 Telegrams Advantage London SW1

Telephone 01-XXZC22XXX@Xxx

834 4422 Ext 737

Mr M A Goodfellow

Hong Kong & Indian Ocean

Department

Foreign & Commonwealth Office

Room 245

King Charles Street SW1

My dear Mark

HONG KONG NONCOTTON TEXTILES

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HKK 6/6

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Your reference

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Our reference

Date

21 February 1973

3.10

Mr Eric Ho (Department of Commerce & Industry, Hong Kong Government) and Mr David Sellars (Hong Kong Government Office, London) duly called on Miss Lowne on 19 February. In a long informal conversation, covering virtually the whole range of textile matters of concern to the UK and HK Governments, the only matter of immediate importance was the state of play on the proposals - to be discussed again in the textile working group in Brussels on 22 February that the EEC should open negotiations with Hong Kong for restraints on exports of certain non-cottons, especially to Germany.

2. We explained that Hong Kong's unilateral and well-timed action at the

end of January in restraining exports to Germany of certain polyester/ cotton goods had certainly had the desired effect of taking the heat out of the situation; but the immediate reaction of relief had been swiftly followed by one of dissatisfaction with a. the coverage (made- ups only) and b. the base year (calendar 1972). In these circumstances it was likely that the Commission would get its mandate to negotiate. There was little chance, we thought, of Germany negotiating for itself.

3. Mr Ho said that he had hoped Hong Kong's action would have eliminated

the problem, and that the Germans would have been prepared to drop the matter. If there was a parallel Benelux problem, which was somewhat doubtful, Hong Kong could even consider unilateral autolimitation here too. If the Commission did get its mandate to negotiate, Hong Kong would prefer that the mandate be either very limited indeed in scope, an authorisation to seek specific, limited improvements in Hong Kong's offer;

or else very wide indeed, so that all kinds of arguments could be deployed over a wide field.

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We took the opportunity of explaining that we cannot be involved in the preparation of Hong Kong's negotiating briefs on this or any future occasion. As you know, I think this is a potential source of embarrassment to us. The Hong Kong officials appeared to accept that they would be on their own when negotiating with the EEC. We agreed to send a telegram to Bonn enquiring about the latest German position. attach a copy of the text.

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