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A continuation of quotas on the other hand, would not give the
industry the confidence or the incentive to undertake the
investment needed to make it more competitive.
Imports of cotton textiles into Britain, the greater part
of which enter duty-free, have now reached 53 per cent. of total
domestic consumption. This is a far higher proportion than in any
other major developed country. In these circumstances, we have
the alternatives of renegotiating the present unsatisfactory
quota arrangements, or adopting a tariff which would be broadly
in the line with those of ther developed countries.
The Government have decided that the right course is to
introduce as from 1st January, 1972, a tariff on imports from the
Commonwealth preference area on the lines proposed by the Textile
Council. From that date the existing general quota system would
be terminated; and the Government would consider the use of quotas
only on particular products under the Long-Term Cotton Arrangement
of the G.A.T.T. and only if total imports of cotton textiles rose
significantly above the present level and caused disruption to the
market in those particular products. These decisions would, of course,
be subject to any modifications that might be required if we joined
the E.E.C.
In reaching this decision I have taken account of the fact
that a number of countries in the Commonwealth have rights to
duty-free entry into the United Kingdom market; and I shall now
initiate the necessary discussions with the Governments concerned.
I am equally conscious, on the other hand, that cotton textiles
have long been treated internationally as a special case; and this
decision will not create a precedent for further departures from
our traditional policy on Commonwealth trade in advance of any
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