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CONFIDENTIAL
DIATE COVERING NOTE BY THE CHAIRMAN OF THE PCO
Х
The attached paper, which takes account of discussion in the Official Committee on Commercial Policy, considers the
line which the United Kingdom delegation should take in the Geneva talks which will begin in October on the question of a straight extension of the Long Term Arrangement on cotton textiles and also on the question of the possible widening of
its scope to cover non-cotton textiles.
2. The Dong Term Arrangement expires on September 30th,
1970, and there is a strong possibility that the U.S. will
propose that it should not only be extended for three years,
but that it should henceforth cover non-cotton textiles as
well.
3. In accordance with the recent Ministerial decision, we
propose to abolish our quotas on (non-cotton textiles as from otton textiles as from
January 1st, 1972, and to replace them, in the case of
Commonwealth imports, with a tariff. We ourselves, therefore,
need cover for the maintenance of our quotas for the period up to the end of 1971, but it would suit us very well to see
the ITA terminated from 1972. There is however, virtually no
prospect that this can be achieved, because other major
importing countries find the Arrangement too convenient.
4. It is, therefore, proposed in the paper that we should
do our best to secure amendments to the terms of the LPA which
will force other importing countries to interpret it more
liberally; and on this basis we should accept the extension
of the Arrangement for three years, although if the extension
could be for two years only, so much the better.
5. We should firmly resist any U.S. proposal for an extens-
ion of the scope of the Arrangement to cover non-cotton
textiles.
ó. The discussions are likely to be prolonged. If at an
appropriate stage in the light of our contacts with other
/ countries