TNAG-0463-FCO40-528-Entitlement-of-Hong-Kong-to-EEC-Generalised-Scheme-of-Prefer-1974 — Page 17

8

GRS 525

PRIORITY

CYPHER CAT A

FM ROME 191038Z

RESTRICTED

RESTRICTED

RECEIVED

REGISTRY No.53

29 JUL 1974

sexl

ма

MAG

Enten AK

122

EEC-GSR

"Prüfun

TO PRIORITY FCO TELNO 425 OF 19 JULY 1974 REPEATED FOR INFO TO PRIORITY GOVERNOR HONG KONG, UKREP BRUSSELS, ROUTINE BRUSSELS, HONG KONG GOVERNMENT OFFICE LONDON (FCO PSE PASS), UKMIS GENEVA, (FOR DORWOOD/PEARSON), BONN, COPENHAGEN, DUBLIN, PARIS, THE HAGUE.

BRAITHWAITE'S LETTER TO BONN OF 25 JUNE, HONG KONG/EEC GENERALISED PREFERENCE SCHEME.

1. HONG KONG GOVERNMENT OFFICIALS DODGE AND TSAO ACCOMPANIED, IN ABSENCE OF COUNSELLOR, BY FIRST SECRETARY ECONOMIC (FULTON) HAD

A THOROUGH EXCHANGE OF VIEWS AT ITALIAN MEA YESTERDAY. ITALIANS WERE LED BY PENNAROLA, HEAD OF DEPARTMENT CONCERNED WITH EEC EXTERNAL AFFAIRS IN THE ECONOMIC DIRECTORATE, SUPPORTED BY URBINI (HEAD OF BILATERAL TRADE DEPARTMENT) AND FABIANI, A GSP EXPERT FROM THE MINISTRY OF FOREIGN TRADE, THE DISCUSSION,

INCLUDING A WORKING LUNCH, LASTED OVER 3 HOURS..

2a AFTER AN INTRODUCTION FROM FULTON INDICATING HMG'S SUPPORT FOR HONG KONG'S CLAIM TO BE UNFAIRLY TREATED BY GSP, DODGE ELABORATED ON SUBSTANCE OF HONG KONG MEMORANDUM (ITALIANS HAD BEEN SENT AN ITALIAN TRANSLATION IN ADVANCE). PENNAROLA IN PARTICULAR DISPLAYED SOUND KNOWLEDGE OF FACTORS INVOLVED AND WAS QUICK TO

SIEZE ON DEBATING POINTS. HE EMPHASISED AT OUTSET, WITHI

JUSTIFICATION, THAT ITALIANS VITTLE HAPPY TO GIVE A FRANK ACCOUNT OF THEIR STATE OF THINKING' WERE NOT PREPARED YET TO COMMIT THEM-

SELVES DEFINITELY ON NEW COMMISION PROPOSALS.

→

34 FOOTWEAR WAS FIRST AND MOOT WIDELY COVERED TEN, ITALIANS

GAVE FIGURES TO SHOW THAT VOLUME OF THEIR PRODUCTION AND EXPOSTS

HAD FALLEN THIS YEAR. WHILE ITALIANS AGREED THAT FURTHER

IMPORTS OF TYPE OF SHOES MANUFACTURED IN HONG KONG (PREDOMINANTLY NON-LEATHER) WOULD NOT DAMAGE ITALIAN MARKET, IT WAS A BAD MOMENT

PSYCHOLOGICALLY FOR ANYONE TO ASK ITALY FOR CONCESSIONS, TSAO THEN

FORCEFULLY DREW ATTENTION TO DECLINE IN HONG KONG **COTTAGE?

FOOTWEAR INDUSTRY BY COMPARING SITUATION IN COUNTRIES LIKE

YUGOSLAVIA AND KOREA, WHICH HELPED BY GSP, WERE PROFITING AT

HONG KONG'S EXPENSE.

/. ITALIANS

RES CRICTED