TNAG-0465-FCO40-530-Entitlement-of-Hong-Kong-to-EEC-Generalised-Scheme-of-Prefer-1974 — Page 11

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their products. But in HK, because of higher production costs, e.g.

raw material prices, rentals of factory premises, workers' wages, trans-

port etc., our products are not so competitive as those of the neigh-

bouring regions. That is why HK rubber footwear find it hard to

compete with similar products made by Taiwan, Korea, Singapore and

Malaysia despite the preferential treatment. What's more, the continued

exclusion of our textiles from the enlarged EEC preference scheme is

really disappointing. We have always hope that Britain will help

HK fight for the inclusion of our textiles in the scheme.

News from Brussels on the 13th stated the EEC foreign minis-

Laris, de usted she might be an (18th) to improve and enlarge the EEC

for the first time, HK rubber and

foo

But such a scheme, applicable to over 100 developing

countries next year, does not apply to imports of leather footwear or

textiles from HK.

The main purpose of the scheme is to urge developing

countries to export to the EEC industrial and semi-manufactured pro

ducts. Under the pressure from the Netherlands and the UK, the minis-

ters agreed to hold a plenary meeting next year (probably in January)

to discuss the system of operation of the scheme.

Both the UK and the Netherlands want to simplify and enlarge

the scheme further so that developing countries may get full benefits

from the preferential treatment. Next year, these developing countries

may export US$2,800 million's worth of goods to the EEC.

The UK Government has requested improved treatment for HK

products as one of her conditions of re-opening talks about her entry

into the EEC.

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