TNAG-0938-FCO40-1157-Visit-of-John-Nott--Secretary-of-State-for-Trade--to-Hong-Ko-1980 — Page 166

CONFIDENTIAL

From the Secretary of State

impossible. The need is now to lean on the Koreans to persuade them to reduce their protectionist barriers against our consumer goods, services and other commercial activities where they still maintain a panoply of protectionist devices against the outside

world. A most encouraging aspect of the visit, however, was the

There is general

From fivation Korean interest in co-operation in third markets.

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agreement in Seoul that whereas the Koreans can undercut us by up

to 50 per cent in tenders for huge construction projects throughout the world and this situation was entirely evidence to me on my recent visits to Iraq and Saudi Arabia - the Koreans badly need engineering skill and design ability to combine with their cheap labour and construction experience. I intend to get the British construction industry together in order to give a push to approaches by some of our leading construction companies to the Koreans to sound out the possibility of us undertaking major contracts together in third countries. It is countries like Korea where Ministerial visits can be highly productive. These countries are not so large as to make a visiting Minister just another "fireman" passing through. Our more traditional markets like Hong Kong and Singapore have, of course, been neglected in the years since our entry in the EEC, but they too, as smaller economies, are growing at around 10 per cent per annum compound, and throughout the Pacific Basin it is the small countries which might be less important from a strategic viewpoint but which in my view we must approach with more aggressiveness than in the recent past in order to assist our exports.

For their part, the Koreans were concerned that the European Community would be pressing for the exclusion of Korea from the next stage of the Generalised System of Preferences. They feel that their recent economic successes should not exclude consideration of the problems of achieving early industrial maturity with

CONFIDENTIAL

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