rates on cotton textiles would not make any significant contribution
to the solution of our problem. In 1968, only about 21% of U.K
cotton textile imports were subject to duty. Well over half these dutiable imports came from high cost areas (E.E.C and U.S.A.), and this trade should, without any change in tariff levels, be drastically reduced once the Lancashire industry raises its efficiency to European standards (a target which the Textile Council is committed to attain).
U.K. mfn tariffs on duitable cotton textiles are already above the average for other developed countries (although the Canadian rates are higher). Given that we have decided to give the Commonwealth the same margin of preference on cotton textiles
as on man-made fibre textiles that is, 85% of mfn rate
-
We
an increase in the mfn rate would scarcely be in the Commonwealth's interests, since the preferential duty rates would also rise. are aware that other major Commonwealth textile importers levy duties on Commonwealth cotton textiles. We shall continue to offer
the Commonwealth some measure of preference.
As regards E.F.T.A., the E.F.T.A. Convention lays down stringent requirements which must be met before duties can be
reimposed on intra-E.F.T.A. trade. E.F.T.A. countries supply only a small proportion (about 10%) of total U.K. imports of cotton textiles; and it is most unlikely that any of them would be in a position to expand their production to the extent which would be required to enable them to take over a large part of the trade supplied by the developing countries of the Commonwealth.
III.
Delegates may refer to the lack of prior consultation about tariff decision
Prior consultation would have been impracticable given
/the
CONFIDENTIAL