Hong Kong
In six months' time the situation may be quite different. may be ready an able to supply at a time when demand has slackened. This is the simple reason why carry-over is limited.
We cannot see any justification in present circumstances for allowing carry-over of more than 10%. Bill Dorward pointed out that Hong Kong's unilateral action on the agreement with the EC was taken on this same basis of an 18 month quote. But the great disparity between Hong Kong's exports to the UK and to the Six is something that we are anxious to reduce. A marginal way in which this could effectively be done would be for Hong Kong to extract a concession on carry-over from the Six, while the UK made no such concession.
To avoid causing offence, we have deliberately omitted any reference to carry-over in the announcement about provisional 1974 textile import arrangements which will appear in Trade and Industry on 8 November. The paragraph covering Hong Kong reads:
"The current arrangements are being extended until June 30, 1974 by increasing the 1973 quota by 50 per cent. A further notice regarding Hong Kong quota levels after July 1, 1974 will be issued in due course."
Could you please let me have your comments? This letter is being, copied to David Sellers and to Mark Goodfellow. ✓
RP Hope
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