RESTRICTED.
AT THE RATE OF 10 PER CENT PER WEEK OF DELAY, TO ENSURE THAT OTHER COUNTRIES SIGNED AGREEMENTS. HE ALSO CLAIMED THAT HONG KONG
WAS REFUSING TO WORK ON THE BASIS OF EEC FIGURES AS PROMISED.
3. FOR YOUR OWN INFORMATION, ON 10 NOVEMBER, MR JUDD TELEGRAPHED THE GOVERNOR EMPHASISING THE NEED TO RESUME TALKS AND OFFERING TO PUSH TRAN INTO MAKING HIS BEST OFFER QUICKLY IF HONG KONG AGREED TO GUARANTEE, PRIVATELY, NOT TO BREAK OFF NEGOTIATIONS AND ULTIMATELY TO ACCEPT THE EEC'S BEST OFFER. THE HONG KONG TEAM RETURNED TO HONG KONG BUT ANNOUNCED THEIR WILLINGNESS TO RETURN AT SHORT NOTICE. TRAN ARGUED THAT THE WITHDRAWAL MEANT THAT THE TALKS HAD BROKEN DOWN. WE PERSUADED HIM TO SAY NOTHING IN PUBLIC AND ASSURED HIM THAT NEGOTIATIONS WOULD BE RESUMED QUICKLY AND CONCLUDED SPEEDILY IF THE EEC HAD SOMETHING IN RESERVE TO
OFFER HONG KONG.
4. ON 14 NOVEMBER WE TELEGRAPHED THE GOVERNOR THAT THE EEC WOULD INVITE HONG KONG BACK TO THE NEGOTIATIONS AND WOULD WITHDRAW SOME OF THE REMARKS MADE AT THE PRESS CONFERENCE ON 4 NOVEMBER IN RETURN FOR A PRIVATE UNDERTAKING TO ACCEPT REDUCTIONS ON 1976 FIGURES FOR IMPORTS, BUT FURTHER HONG KONG DEMANDS WOULD, HOWEVER, LEAD TO A PUBLIC REBUTTAL, WE EXPLAINED THAT HONG KONG WOULD HAVE TO ACCEPT SACRIFICES TO HELP THE VERY UNDERDEVELOPED COUNTRIES AND FELT THAT RECATEGORISATION WOULD CAUSE SHORT-TERM PROBLEMS BUT WOULD BE MORE SATISFACTORY ONCE INTRODUCED. WE GAVE OUR ASSURANCE THAT THE THREATENED REDUCTIONS WOULD NOT HAPPEN IF HONG KONG RETURNED TO THE NEGOTIATING TABLE PROMPTLY. IN BRUSSELS, WE EXPLAINED THAT WE WOULD DO ALL IN OUR POWER TO GET THE HONG KONG DELEGATION BACK TO THE TABLE IF THE COMMUNITY WOULD ISSUE AN
INVITATION.
5. SINCE THEN NOTHING HAS HAPPENED, APART FROM, AS YET, UNCONFIRMED PRESS REPORTS THAT TRAN HAS MADE A CUT IN THE OFFER
FOR HONG KONG.
6. THE DECISION TO TAKE THE LINE ON TEXTILES DESCRIBED IN
2
RESTRICTED.
/GUIDANCE
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