ITEM 1
GSP AND THE SUFERCOMPETITIVE: HONG KONG
1. This note aims to set out the issuea to be considered in forming a view on the Commission's plans for revising CSP with particular reference to Hong Kong,
Background
2.
At the meeting in Brussela on March 23 Kember states ourselves apart showed themselves sympathetic to the Commission's proposals for limiting further the access of the "supercompetitive" developing countries to GSP. Those were put forward as part of a package for "improving" CSP in 1975. The package consists broadly of replacing the rigid quotas for "sensitivo" products
in exchange for which the butoir limiting the amount of a product to enter from any cho supplier would be reduced to 10% in the case of the "auperecmpetitive" (SuperC's),
3. A country would be defined es supercompetitive for a particular product if it had either hit the butoir in 1972 and 1973 or supplied more than 40% of the Six's imports of that product from all beneficiaries in 1973.
Other Henbor Statca reactions
42 Some representatives folt that 10 butoir threshold to be too low, and suggontod 15. The Germans went further, suggesting that no beneficiary should suffer any reduction in the absolute level of its preferential trado (on the reasoning that with increasing annual quota levels, the 10 or 15 butoir would soon catch up with a poga loval of trado). The Commission is known to be sympathetic to the notion of the "aquis".
5.
There was a warm welcome for abolition of the sensitive list and quotas, evidently because of the administrative burden they pose. But it was clear that a hard core of quotas would remain, estimated at one product by France ard fifteen or so by Ireland and Italy.
S.
There was no elucidation of the system of control to replace quotas. We can only presume that in practice overall quantitative limits would be applied though without individual country allocations,
7.
Some countrics thought that both criteria should be fulfilled for a country to be designated supercompetitive, but most wore content with the Commission's either/or proposal.
UK views
8. The UK reserved its position. We did however suggest that our Government would be looking for a really generous initiative in GSP for instance giving unrestricted entry to products from the poorest developing countries. We pointed out the very covere impact that the proposals as they stood would have an fong rong
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