TNAG-1055-FCO40-1305-Trade-relations-between-Hong-Kong-and-the-UK-1981 — Page 16

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Turning to the subject of voluntary restraint

arrangements, Mr. Hewitt explained that the UK electronics

industry was going through a period of re-adjustment. To enable the industry to overcome the difficulties connected with such a process, they had negotiated a series of VERS with Japan, S. Korea, Taiwan and Singapore. These arrangements had, so far,

r, been

successful. There were, however, recent indications that the efficacy of the arrangements was being eroded by transhipments of Korean and Taiwan products to the UK through Hong Kong. For this reason, the delegation had just secured the Taiwanere industry's agreomont to ourb auch practice through closer monitoring at the Taiwan-end. The delegation would be holding similar talks with Japan, S. Korea and Singapore. In view of Hong Kong's role as an entrepôt, they would like to seek Hong Kong's co-operation in the matter, by supplying data on a continuing basis to assist in monitoring trends.

5.

Mr. Hewitt recognised that Hong Kong was already providing data on a regular basis in respect of monochrome and colour television sets. This, however, did not cover "music centres", CCCN 85.15.19.20 (a combination radio/tape recorder/record player, with or without loudspeakers), which was also a concern. At the moment, there existed a substantial discrepancy in the published statistics. The UK import statistics showed that, in 1980, it had imported 61,401 pieces of such products from Hong Kong. The Hong Kong statistics; however, showed zero exports of such products. This was possibly due to a classification discrepancy.

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Mr. Dorward commented that Hong Kong could not agree to entering into VERS because they were objectionable in principle. Moreover, VERS tended to have a knock-on effect which rendered them ineffectual. As regards transhipments and the enforcement of VERS, he stressed that it was a question which had to be resolved between the UK and the country of origin. He agreed, however, that, provided the classification problem could be sorted out, Hong Kong would be willing to provide statistics in respect of such products. The discrepancy in the published statistics could possibly be attributed to the UK practice of counting imports on the basis of country of shipment rather than country of origin.

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7.

Mr. Hewitt thanked Mr. Dorward for his undertaking to assist and undertook to provide a precise definition of the product for examination. He agreed that the discrepancy in statistics was probably due to the method of logging imports. They would take up. the matter with the appropriate authorities on their return to the UK

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In answer to Mr. Hewitt, Mr. Chan said that as far as he was aware Hong Kong had no production of record players but this did not mean that Hong Kong could not produce "music centres". The record player component could be imported for assembly with looally produced radio/tape recorders.

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