TNAG-0627-FCO40-775-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 87

Sir Peter Carey KCB

Permanent Secretary

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HKGO. To bi Kidd.

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DEPARTMENT OF INDUSTRY

1 VICTORIA STREET

LONDON SWIH OET

TELEPHONE DIRECT LINE 01-215

SWITCHBOARD 01 215 7877

5424

Mr D II Jordan

Director of Commerce and Industry

HONG KONG

27 May 1977

cc:

Mr Ridley

Mr Lippitt

Miss Lowne

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Mr J Stewart Hong Kong

Dept, FCO

Mr Hudson (with mapers)

Dear Davids

Thank you for your letter of 7 April about textiles and the MFA.

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I have thought long and hard about the points you make in your letter in the light of al 1. 1 heard and said during my stay in Hong Kong and in the light of developments both at home here and in the Community since then. I will not go through your detailed points since I know that you and the rest of your team will present them with all

your usual vigour and skill when the negotiations get under way again in Geneva. It will then be for the Community and all the other participants in the discussions, to demonstrate how far they consider that your arguments can be sustained and whether, and how far, they are prepared to modify their own views in the face of your arguments.

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You will appreciate from the stance the Community took in Geneva last December and from all that has happened since that the Community intends to seek substantially improved safeguards in a new MA and clearly the dominant position of Hong Kong in their market must figure large in the Community's consideration of how to secure these safeguards. Indeed, as you well know, there is substantial pressure within the Community for cutbacks in access. for the dominant suppliers. We are not immune from this pressure ourselves from our own industry and we can give no guarantee that the Community will not propose that the increased protection it must have should be at the expense of the large suppliers.

about uncertainty in the Nevertheless, I do not

I appreciate fully the points you make trade if the MFA negotiations drag on. share your belief that because of this a straight forward extension of the MFA is the best available solution and I made this very clear in Hong Kong. Certainly the Community's use

use of the MFA has not been as effective and vigorous as it could have been, but the fact remains that the Community and others deficiencies in the Arrangement itself and these have got to be tackled. Postponement of the job for a year will make it no easier and nor will the uncertainties be any less.

Best miste

"RE

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