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of the trade here was in madeup goods. A bilateral agreement
had recently been concluded with the Benelux countries under
Article 3 of the G.A.T.T. Long Term Arrangement giving Hong
Kong an anrual quota of 9-10m. square yards in restrained
items. In addition Hong Kong had some 16m. square yards of
trade in unrestricted items with the Benelux countries.
Kong had a theoretical access to the French market of the
order of 350 tons and this figure would rise to 450 tons by
1969. In practice, however, exporters were prevented from
taking up fully this allocation because the quantitative
restrictions tended to be supplemented by administrative ones.
Until recently Hong Kong's exporters had not known who the
holders of import licences were, since the French had never
published lists of their names. Allocations were granted to
Government Departments and other bodies who never exercised
their importing rights. Hong Kong was therefore limited to
sending around 2.5m. square yards to the French market.
Ostensibly, Hong Kong had free access rights in Italy, however
these were in practice negated by the activities of the
Italian Customs. Some 15m. square yards were sold annually
to this market.
10. Hong Kong regarded it as virtually certain that the Six
would progressively invoke the market disruption clause
(Article 3) of the Long Term Arrangement while this agreement
remained extant, This would have the effect of suppressing
the remaining sectors of the cotton trade in which free trade
was still permitted and of bringing all cotton textiles under
specific restraint.
11.
A common Community policy on textile imports was
germinating, with the concept of a "total tolerable intake"
into the E.E.C., which would be subdivided into country
allocations Although it was not possible tp predict
accurately how restrictive a Community Policy on textiles would
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