TNAG-1401-FCO40-1873-Future-of-Hong-Kong-continued-participation-in-the-General-A-1985 — Page 166

CONFIDENTIAL.

DEPARTMENT OF TRADE AND INDUSTRY

Room

28

AkCK 040/24

International Trade Policy Division 1

Victoria Street London SW1H OET.

452 Telex 8811074/5

Answer Back DTHQ G

Telephone (Direct dialling) 01-215)

5458

GTN

(Switchboard)

215) 215 7877

Mrs J S C Priest

Hong Kong Department

Foreign and Commonwealth Office

London

SW1A 2AH

low My Prent

مشهر

HONG KONG: GATT

SAPRISS

Your reference

Our reference

Date

Onła ora

2 pr. 44

28 March 1985

Dragireply deemed in th

M. Burrowel

mr. Wome

EZDCE).

or x/4

(14)

Thank you for your letter of 15 March addressed to Tony Lane.

Unfortunately we did not receive our copy of Dame Anne Warburton's teleletter until 27 March.

I am not quite clear about the relationship between paras 2 and 5 (a) and (b) of the teleletter. Para 2 implies that the use of the machinery of Article XXVI 5(c) of the GATT is sufficient to open the way for de jure membership for Hong Kong. Para 5, however, indicates that the use of Article XXVI 5(c) would lead only to de facto membership and would need to be supplemented by a statement from Hong Kong saying it wished to become a de jure contracting party. In the latter case, what would be the machinery whereby de jure membership would be conferred?

-

which is, as

Otherwise, I have no difficulty with the broad strategy proposed you say, very much in line with Telegram No 509 of 1984 to Hong Kong. Equally, I agree that it would be useful for any Chinese statement to GATT to include a specific reference to retention of Contracting Party status after 1997.

I think we have, however, to recognise that China's acquiescence in this strategy may become dependent upon progress towards China's own membership to the GATT. We have been taking another look at this in the DTI and we shall shortly be sending a paper to FCO. We can see problems about Chinese membership and believe it would be preferable if China remained outside GATT. We cannot at this stage tell whether (a majority of) other GATT members might take the same view. The position is complicated by the fact that the USSR are also beginning to knock on GATT's door. Our paper will also consider the question of what special terms could be negotiated to limit the possibility of damage from Chinese membership if such membership could not ultimately be resisted. Consideration of the role we want China to play in relation to Hong Kong's future in the GATT will need to be set in the context of any conclusions that HMG may reach about the desirability of supporting Chinese membership of the GATT.

Your merly

1 Энки воз

-

A J Pryor

CC

Mr Burrows, FCO Legal Adviser's Department

Mr Warren, ECD(E), FCO

Mr Madelin, ITP1

Mr Cruickshank, OT4

Mr A Montgomery, UKMIS, Geneva

CONFIDENTIAL

M54