-3-
Lutowever,
participate in Washington in mid-September.
However,
the Americans do not have legislative authority to impose restrictions on imports in the absence of an international agreement and for that reason another attempt will be made to secure international agreement to an extension of the G.A.T.T. Cotton Textiles Agreement to non-cotton goods. The opportunity will present itself at the meeting of the Cotton Textiles Committee on
8-10th October.
7.
Time is likely to be on the side of the protectionists. The textile industry in this country and on the continent
has recovered from the severe recession of 1967. The U.S.
industry has also recovered from the mild recession which it had then. Order books in this country are beginning to shorten and a world-wide down-swing of the textile cycle can be expected in 1970. This will be superimposed on a secular decline in employment as a result of the rapid increase which is taking place in productivity in the industry. The pressure on governments next year to adopt a restrictive policy will be very great.
United Kingdom Policy
8. The Government have decided to rely on the tariff to protect the U.K. textile industry from low-cost competition from Japan and the developing countries, including, in the case of man-made fibre and woven cotton textiles, the developing countries of the Commonwealth. This means that from 1972 onwards the
U.K. will be the only country exposed to unlimited competition from the Asian producers unless we can persuade other importing countries to follow our example: and the more other developed countries extend restrictions
to non-cotton textiles the worse our position will be.
9. The position would probably not become intolerable in the case of cotton. The Government have said that they would not be prepared to contemplate the re-imposition of quotas on cotton textiles under the C.T.A. unless total imports (i.c. including imports from the developed countries) rose significantly above the present level, and then only on a selective basis to deal with disruption