TNAG-0631-FCO40-779-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 121

GPS 180

PRIORITY

CYPHER CAT A

CONFIDENTIAL

HKK 120/616/1

RELZIVED IN REGISTRY :-

3 - NOV 1977

INDEX

281

FM UKMIS GENEVA 271022Z

CONFIDENTIAL

TO PRIORITY HONG KONG TELNO 17 OF 27 OCTOBER. de

INFO PRIORITY WASHINGTON (FOR CRWSON), BRUSSELS (FOR BURGESS), HK GOVERNMENT OFFICE LONDON.

FROM TSAO

FUTURE OF THE MFA AND THE MTN.

R

LAST

F&

1. AT THE MEETING YESTERDAY (FULL REPORT FOLLOWS BY MEMO) CALLED BY THE US TO DISCUSS THEIR DRAFT SAFEGUARD CODE WITH A GROUP OF DEVELOPING COUNTRIES, THE LINK BETWEEN THE FUTURE OF THE MFA AND THAT OF THE MTN WAS DISCUSSED AT SOME LENGTH.

2.

IT WAS GENERALLY AGREED:

(A) THAT NEGOTIATIONS IN THE SAFEGUARDS GROUP TO DATE, AND THE US DRAFT CODE, HAVE PROCEEDED ON THE ASSUMPTION THAT TEXTILES WOULD BE DEALT WITH SEPARATELY:

(B)

THE QR SUB-GROUP HAS PROCEEDED ON THE SAME BASIS AND

HAS NOT CONSIDERED HOW TO DEAL WITH TEXTILE QRS:

(c) THAT THERE CAN BE NO REAL PROGRESS IN THE TARIFFS

GROUP WITHOUT PROGRESS ON SAFEGUARDS (THIS IS ACCEPTED BY EVERYONE INVOLVED IN THE MTN).

3.

ALL PRESENT DREW THE INEVITABLE CONCLUSION: (A)

THESE THREE MAJOR AREAS OF THE MTN WOULD BE COMPLETELY

DISRUPTED IF THE MFA FAILED:

(B) THUS THE MTN WOULD BE LIKELY TO COLLAPSE.

FCO PASS TO HK GOVERNMENT OFFICE LONDON.

BOTTOMLEY

FILES

TREU

ECON D

HK & GD EID

MR THOMAS MR HAYES

COPIES TO

HONG KONG GOVT OFFICE LONDON

CONFIDENTIAL