ENG-1994 — Page 142

TRADE AND INDUSTRY

replace the GATT. Hong Kong, as an existing member of GATT, will automatically become one of the original members of the WTO when it is set up in 1995.

Given the open nature of the Hong Kong economy and its reliance on trade, open and free trade under an effective multilateral trading system is of vital importance to the territory's continued success. Hong Kong will continue to play an active role in the organisation to uphold the integrity of the multilateral trading system and to safeguard the territory's trading interests.

Textiles

Bilateral agreements negotiated under the Multi-Fibre Arrangement (MFA) currently govern Hong Kong's textiles exports to Austria, Canada, the European Union (EU), Finland, Norway and the United States of America. In the UR, it was agreed that the MFA will be replaced by the WTO Agreement on Textiles and Clothing (ATC), which provides for the gradual removal of quantitative restrictions on these products in 10 years' time. Hong Kong has been working closely with other exporters of textiles and clothing in the International Textiles and Clothing Bureau to prepare for the phasing-out of the MFA and the implementation of the new ATC.

Austria, Finland, Norway and Sweden are seeking accession to the EU. The impending alignment of their import regimes with that of the EU would result in the extension of quota restrictions on textile products to them. Compensating quota adjustments for Hong Kong have been secured, following bilateral consultations between the Hong Kong Government and the European Commission in November 1994.

> During the year, representatives of the governments of Hong Kong and the United States of America met to discuss bilateral and international co-operation to control and eliminate illegal transhipments of textiles and garments. Both governments agreed to continue their mutual efforts to address the matter.

Non-textiles Issues

Despite representations from the Hong Kong Government, the EU concluded the anti- dumping investigation on 3.5-inch magnetic floppy discs originating in Hong Kong with the imposition of definitive anti-dumping duties ranging from 6.7 per cent to 13.3 per cent for investigated companies, and a residual rate of 27.4 per cent for all other companies.

In September, the EU initiated a 'sunset' review relating to the anti-dumping measures on video cassette tapes. Existing anti-dumping measures, which were imposed in 1989 and would otherwise have been due for termination, will remain in force until the review is completed.

In March and April, two anti-dumping proceedings against Hong Kong, initiated by Australia in respect of glass and by New Zealand in respect of men's shirts, were terminated. However, Argentina and Australia initiated two new anti-dumping investigations against the territory during the first half of 1994, in respect of men's shirts and disposable plastic cutlery, respectively.

On July 14, the United States of America revoked its anti-dumping duty order against Hong Kong exports of man-made fibre (MMF) sweaters. The revocation came as a result of a final court decision in June, upholding the United States International Trade Commission's revised determination in 1992 that the United States' domestic industry was

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