TNAG-1492-FCO40-2050-Future-of-Hong-Kong-General-Agreement-on-Tariffs-and-Trade-(-1986 — Page 326

GRS 2000

CONFIDENTIAL

FM UKMIS GENEVA

TO PRIORITY FCO

TELNO 155

OF. 041416Z APRIL 1986

CONDENTIAL

025

My Thomas

The interesting food

1714 Sales

R+RKE

INFO ROUTINE UKREP BRUSSELS, WASHINGTON, TOKYO, NEW DELHI, BRASILIA, INFO ROUTINE MEXICO CITY, PEKING, SEOUL

INFO SAVING OTHER OECD POSTS, DHAKA, BOGOTA, PRAGUE, KINGSTON, INFO SAVING BUDAPEST, JAKARTA, KUALA LUMPUR, ISLAMABAD, LIMA,

INFO SAVING MANILA, WARSAW, BUCHAREST, SINGAPORE, COLOMBO, BANGKOK,

INFO SAVING MONTEVIEDO, SOFIA, CAIRO

CE

7/4

GATT: TEXTILES COMMITTEE, 3 APRIL 1986

HKK 1221 PFOS VEO IN SE STRY - 7 APR 1986

SUMMARY

BUSINESSLIKE MEETING. NO CONCRETE PROGRESS WAS MADE, BUT THERE WAS A SENSE THAT NEGOTIATIONS WERE NOW UNDERWAY. THE COMMUNITY STATEMENT CONTRIBUTED TO THIS BY ADDRESSING SPECIFIC ISSUES IN THE

NEGCTIATIONS. IT RECEIVED A CAUTIOUS WELCOME BY THE LDCS AND WAS IN MARKED CONTRAST TO A TOUGH AND UNCOMPROMISING US INTERVENTION.

DETAIL

COMMUNITY COORDINATION

2.

LENG (COMMISSION) GAVE AN ACCOUNT OF INFORMAL DISCUSSIONS. MOST OF THE TALKING HAD BEEN DONE BY SUPPLIER COUNTRIES. INDIA AND BRAZIL HAD TAKEN THE LINE THAT THERE WAS NO POINT IN DISCUSSING SPECIFIC

ELEMENTS OF THE PROTOCOL UNTIL A FRAMEWORK FOR A RETURN TO GATT RULES HAD BEEN AGREED. OTHERS HAD BEEN WILLING TO GET DOWN TO SPECIFICS. HONG KONG HAD ARGUED THAT WHERE THERE WAS A DEROGATION FROM THE 6% RULE BECAUSE OF EXCEPTIONAL CIRCUMSTANCES'', A LOWER LIMIT SHOULD BE SET ON GROWTH RATES TO AVOID TRIVIALLY SMALL GROWTH RATES BEING INCLUDED IN BILATERAL AGREEMENTS.

3. THE JAPANESE HAD BEEN ALMOST COMPLETELY SILENT. CARLYLE (US) HAD SPOKEN RELATIVELY LITTLE BUT HAD SAID THAT PROVIDED HE OBTAINED FIBRE COVERAGE EXTENDED TO INCLUDE RAMIE, AND SOMETHING TO DEAL WITH EXCESSIVE GROWTH OF IMPORTS IN PARTICULAR PERIODS, HE WOULD BE ABLE TO DISCUSS OTHER PROVISIONS WITH AN OPEN MIND. HE HAD QUOTED SOME HIGH NUMBERS FOR GROWTH RATES OF PARTICULAR PRODUCTS, ESPECIALLY RAMIE FROM KOREA, HONG KONG HAD REPLIED THAT THE PROBLEM TO ADDRESS IN THE MFA CONTEXT WAS NOT OVERALL RATES OF GROWTH BUT THOSE OF

PRODUCTS FROM CONTROLLED SOURCES. KOREA SAID THEY HAD MADE ENORMOUS INVESTMENT IN RAMIE WITH THE INTENTION OF EXPORTING IT EVERYWHERE IN LARGE QUANTITIES. LENG HAD WARNED THEM THAT IF THEY DID SO THEY WOULD FIND OTHER DEVELOPED COUNTRIES SUPPORTING THE US. ALL LDCS PRESENT HAD FIRMLY REJECTED COVERAGE EXTENSION.

CONTIDENTIAL.

/TEXTILE