ENG-1985 — Page 87

INDUSTRY AND TRADE

Non-Textiles Issues

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French quantitative restrictions: France has been maintaining unilateral quantitative restrictions against imports of three products from Hong Kong, namely, digital quartz watches, radios and toys. This is a subject of continuing consultations between Hong Kong and the EEC Commission.

Generalised Schemes of Preferences (GSP): GSP are operated by most developed countries to promote the exports of goods from developing countries and territories by providing duty-free or reduced import tariff treatment. Following the inclusion of Hong Kong in Finland's GSP in May, Hong Kong is now a beneficiary of all the GSP operated by developed countries. However, certain products from Hong Kong are excluded in a discriminatory way from the schemes operated by Australia, Austria, Finland, Norway, Switzerland and the United States. These exclusions are the subject of continuing discussions between Hong Kong and the countries concerned.

In May, the EEC Commission reviewed the EEC GSP and proposed to exclude 12 Hong Kong products from GSP benefits. Hong Kong made a detailed submission to the commission in September, opposing the exclusion. The Council of Ministers decided in December that these products would retain GSP benefits under the EEC's 1986 scheme but would be subject to reduced quota levels.

The New Zealand Government introduced a new policy in its GSP whereby existing beneficiaries with per capita GNP equal to or exceeding 70 per cent of that of New Zealand would lose their beneficiary status from July 1985. Hong Kong and other LDCs expressed objections to this policy, and the subject continued to be under discussion between Hong Kong and New Zealand.

The US GSP was extended for 8 years in January and Hong Kong continues to be a beneficiary. Under the extended scheme, the US President is required to conduct a general review to determine the extent of preferential treatment granted to beneficiary countries. Any modification made as a result of the review will take effect on July 1, 1987. The Hong Kong Government and private sectors have participated actively in the review.

New round of trade negotiations: During the year, there were extensive discussions in the GATT on beginning a round of multilateral trade negotiations to further liberalise world trade and reaffirm the commitment of contracting parties to observe the disciplines of the agreement. An agreement was eventually reached by GATT contracting parties in November that a preparatory committee should be formed to pave the way for a new round. Hong Kong participated fully in the discussions.

Documentation of Imports and Exports

As a free port, Hong Kong keeps its import and export licensing requirements to a minimum. Products over a wide range do not need licences to enter or leave Hong Kong. Where licences are required, they are intended to achieve two main objectives. Firstly, they help Hong Kong to fulfil its international obligations to restrain exports of textiles products and, related to this, to monitor the flow of these products into Hong Kong. Thus there is a requirement for all imports and exports of such products to be covered by licences issued by the Director of Trade. Secondly, they help Hong Kong to control, on health and safety grounds, exports and imports of a few types of non-textiles products such as pharmaceuticals.

There is in Hong Kong a certification of origin system to establish the origin of the goods which Hong Kong exports and to meet the requirements of the importing authorities. The Trade Department administers and safeguards the integrity of this system, and issues