1
CONFIDENTIAL
MR BLAKER'S VISIT TO HONG KONG, 23-25 SEPTEMBER
TEXTILES
LINE TO TAKE
(DEFENSIVE)
1. We see no prospect of reopening the terms of the EEC/Hong Kong textile agreement. To do so would only lead to the reopening of all the Community's MFA agreements.
2. Recognise that imports from preferential Mediterranean suppliers increased rapidly in 1978. UK pressed successfully for restraint
from these sources and further increases will be only moderate.
3. Aso acknowledge increase in imports from other EEC Member States. But Hong Kong's agreement is with Community as a whole. Only comparisons with other non-Community suppliers' access to the EEC market are relevant to the Hong Kong case. Obviously no question of UK imposing restrictions on intra-Community trade.
BACKGROUND
4. The outline of the Hong Kong government's case over textiles A is set out in Hong Kong telegram no 1285. The manner in which it
has been pursued so far suggests that the real Hong Kong objective
may not be seriously to attempt to reopen the terms of the present EEC/Hong Kong textile agreement but to prepare the ground for its
eventual renewal on more favourable terms.
5. Over half Hong Kong's exports to the UK are textiles and clothing. She remains the UK's largest low cost supplier for these products. The trade has been restricted for two decades; the present quotas are part of the 1978-82 EEC/Hong Kong bilateral agreement negotiated under the umbrella of the GATT Multifibre Arrangement. After bitter negotiations Hong Kong accepted with great reluctance quota levels for 1978 which in the case of six products involved reductions from her 1976 sendings to the UK (similar reductions were negotiated with South Korea and Taiwan, but with no other suppliers).
CONFIDENTIAL
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