TNAG-0462-FCO40-527-Entitlement-of-Hong-Kong-to-EEC-Generalised-Scheme-of-Prefer-1974 — Page 88

CONFIDENTIAL

Foreign and Commonwealth Office

London SW1

JB Ingram Esq

CRE1

DTT

1 Victoria St

SW1

Telephone 01-

Your reference

Our reference HKK 6/598/1

Date

15 February 1974

Dear Ingram

GENERALISED SCHEME OF PREFERENCES:

1.

HONG KONG

I have seen your letter of 12 February to Roger Hart in European Integration Department which you copied to Mark Goodfellow in my Department.

2.

I am frankly concerned about paragraph 3 of your letter where you suggest we might tell Hong Kong that their industry's wishes on the GSP will not be realised. I do not question your appraisal of the possible outcome of the Annual Review; but I am alarmed at the suggestion, which is most explicitly expressed in your letter but which has recently surfaced in several papers in Whitehall, that we have, in effect, to accept defeat on this issue even before the discussions begin. Still less do I like the idea that we should confess this to Hong Kong.

3.

As you know Ministers decided last November that we should postpone our major effort to eliminate discrimination against Hong Kong until we had aligned with the EEC's GSP. But Mr Davies' statement in Brussels on 6 November was a clear promise to Hong Kong of resolute action in the future. It avoided a major row with Hong Kong; but it stored up the possibility of very substantial trouble if in the end we do nothing. It was thus a hostage to fortune. We must now be seen to try very hard in Brussels on Hong Kong's behalf. If, in the end, we fail, Hong Kong would have to live with this. But we really must not even tacitly accept that we have lost before we have begun.

I am sending a copy of this letter to Mary Lackey and to the relevant departments in the FCO.

4.

сс

Miss Lackey, DTI Fir Braithwaite, WOD Mr Cloake, TRED Mr Youde

CONFIDENTIAL

Your Eve

Andrew

A C Stuart

Hong Kong & Indian Ocean Dept.