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79
17th June 1969
UNCTAD Preferences:
U.K. Offer
Thank you very much for your letter of the 4th June, with which I very largely agree. I do not propose to comment in detail on the many points you raise since these are perhaps now best discussed between departments informally as I suggested in April, and then subsequently at a meeting of TCO when we seek formal authority for revising our 1st March submission. Since you have raised a few upeuific queries I should however give you my answers.
2. In your paragraph three you are of course right that we could not make the position of the Commonwealth worse than it is now by limiting existing duty free entry by including them in the quotes applicable to beneficiary countries. The Corumonwealth will have to continue to enjoy unrestricted duty free entry where they enjoy it now. The issue we are now considering is whether we should give the Commonwealth duty free entry on those goods now subject to a Commonwealth duty (mainly man made fibres, cars, watches etc.,) and limit the impact of domestic producers by including the Common-- wealth with other developing countries in the quota. The alternat- ives to this could include reducing the m.f.n. rate to the Common- wealth rate orgiving only a reduction in the Commonwealth rate.
3. In your paragraph four you ask whether we would be free to apply a quota ceiling to a product hitherto unrestricted in the scheme at the request of a Commonwealth supplier. I am sure that we shall wish to be able to do this at the, request of the Common- wealth in certain circumstances, and also at the request of other traditional suppliers. The only restriction on our freedom of action will be the "burden sharing" principle whatever this turns out to mean.
In your paragraph six you refer to the practical difficulties raised by quotas. It is because we are still exploring thesewithin the Board of Trade that we have not yet called the proposed preliminary meeting. I hope that we shall be sufficiently clear about these difficulties to be able to put them before a meeting to be considered with the other aspects of the subject before very long. Similarly we must consider the practical effects of limiting access for any one country to not more than 50 per cent of a quote.
We also have to think further about the problem of evaluation of offers which you mention in your paragraph seven.
R. G. Britten Esq.,
Trade Policy Department Foreign and Commonwealth Office Great George Street. LONDON SW 1.
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