TNAG-1055-FCO40-1305-Trade-relations-between-Hong-Kong-and-the-UK-1981 — Page 5

50

4

RESTRICTED

DEPARTMENT OF TRADE

IT/2 Division

1 VICTORIA STREET

НКК

LONDON SW1H OET

Telephone Direct Line

Switchboard

121/10

RECEIVED IN ROOSTRY NO. SI

1 2 NOV 1981

DESK OFFICER

INDEX

PA

No

A J Niedus zyuksi Esq

Department of Industry

Rm 421

Dean Bradley House

SW1

Dear Tary

CEE

12/1

BADUSTRY Action Taken

firm 12/4

M.

01-215 5242 01-215 7977

6 November 1981

William Jrou

Mr. Edfar

10.1

This looks sensible

TV SETS ETC: IMPORTS TRANSHIPPED VIA HONG KONG

My interest in this matter concerns Hong Kong (HK).

Did..

The Minister for Trade, Mr Rees, will be visiting HK around 17-18 December, on the way back from China, and plans to hold a press conference there. He will undoubtedly be questioned most on the renegotiation of the Multifibre Arrangement. Partly since Mr Rees's HK stop will be brief (and he wants time to renew personal contacts) we shall advise him not to raise with the HK Governor the TV sets question. But we shall have to brief Mr Rees in case anybody else, eg at the press conference, reverts to it, which seems likely after the recent visits by Atkinson and the RIC delegation.

We understand that the UK industry and the DOI is not now seeking any VRA with HK in respect of TV sets of HK origin. We need to be ready for the Minister to be asked a straight question on that and would wish him to be able to give a straight answer. There would be no intention, clearly, of weakening the strength of HMG's support for the other VRAS: in giving such a straight answer that support could be reaffirmed to prevent any unwarranted wider inference being drawn. As I say, my concern is with HK.

As regards the transhipment point, the Minister should acknowledge that there is a problem; that it is HMG's main concern in respect of HK; that various means of dealing with it are being studied; and that all assistance the HK government and industry can reasonably give to that end will be welcome. HK is already providing statistics broken down between re-exports and exports of HK origin but we need to examine further steps that can be taken, eg in helping to reconcile differences between UK import and HK export statistics. It does not seem wise to go any further into the details. We then become vulnerable to arguments, tendentious or not, that we should not leave others to do all the work for us, eg to make up for self-inflicted difficulties like the civil service strike.