TNAG-2750-FCO40-3965-Most-favoured-nation-status-for-China-Hong-Kong-interests-1993 — Page 222

CODE 18-77

Mr Morris

HKD

CONFIDENTIAL

HKB 091/1

RECEIVED IN REGISTRY

17 MAR 1993

DISKUSILLA

INDE

PA

REGISTRY Action Taken

Reference...................

US/CHINA: MFN RENEWAD (yr teleletter 9 March)

Mr Whirley 12/1.

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1. I said I would continue to look into US-China trade relations with reference to the role of Hong Kong. This is progressing but I thought I would let you have the first fruits of work in hand now that TUR has been sent.

2. The charts attached show the changes in the share of the US imports for the major countries involved in seven important categories of manufactures since 1986. The charts for clothing & apparel, footwear and toys & sporting goods (1,4 and 7) and to a lesser extent textiles & fabrics are particularly interesting. They show a rapid increase in the Chinese share of the US import market and a corresponding decrease, to varying degrees, in the shares of Hong Kong, Taiwan and Korea.

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3. Obviously more needs to be done on this to relate market share to the underlying value of trade and US own production. I also intend to pull together some evidence on US exports to China (why have they have been so sluggish grain is part of the answer) and a broader picture of Chinese exports to the US. The big question is who own the firms conducting US - China trade. HK, China the US or others and in what

This may be less easy to answer.

proportions?

Cletoph M

Christopher Lane Economic Advisers WH426b 270 2727

10 March 1993

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CONFIDENTIA

Vie Comcen

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pl.cc. by FAX to

Slattism, washington WEhrman, PA, Hong Kay A Paul, UKREP JLG, Hongking N Cox, dekking

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