WASHINGTON TELNO.1412 TO FCO.
CONFIDENTIAL
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MOVES ONLY AS THE SITUATION DEVELOPED.
THE ADMINISTRATION'S TRADE BILL IS BELIEVED TO BE IN AN
ADVANCED DRAFING STAGE BUT NO DECISION HAS BEEN TAKEN WHETHER AND
WHEN TO PRESENT IT TO CONGRESS. ONE MAJOR DIFFICULTY IS THAT THE
HOUSE WAYS AND MEANS COMMITTEE IS STILL DEEPLY ENGAGED IN TAX AND
BUDGET QUESTIONS WHICH COULD LEAD TO A PROTRACTED ARGUMENT WITH
THE ADMINISTRATION AND WOULD ALLOW THE COMMITTEE NO TIME TO
CONSIDER A TRADE BILL FOR SOME WHILE. IT IS AT THE MOMENT ANYBODY'S
GUESS IF A BILL INCLUDING THE ABOLITION OF A.S.P. WOULD PASS,
WHETHER OR NOT TEXTILE RESTRAINTS WERE EXTABLISHED.
6. AGAINST THIS BACKGROUND I CAN STILL SEE NO ADVANTAGE IN GIVING
STANS ANY ENCOURAGEMENT ON TEXTILES. AS SEEN FROM HERE THE BEST
LINE IN HONG KONG WOULD BE THAT ALREADY TAKEN IN LONDON. ASSUMING
THAT THE U.S. DELEGATION WILL CONTINUE TO BE UNABLE TO MAKE AN ECONOMIC CASE FOR A GENERAL EXTENSION OF TEXTILE RESTRAINTS (AND WE DO NOT SEE HOW THEY CAN), THE MILLS BILL, RAISING AS IT DOES THE DIRECT THREAT OF IMPOSED QUOTAS (WHETHER MILLS HIMSELF INTENDS THIS OR NOT), COULD BE USED TO PUT THE STRAIGHT QUESTION TO STAUS
WHETHER THE UNITED STATES WOULD CONTEMPLATE TAKING SUCH ACTION
REGARDLESS OF THE GATT. THE VIEW HAS BEEN EXPRESSED TO US MORE
THAN ONCE PRIVATELY FROM WITHIN THE ADMINISTRATION THAT SUCH
DIRECT TALK, AS DISTINCT FROM THE RATHER GENTLER RECEPTION
ACCORDED STANS IN EUROPE, COULD DO NO HARM.
7. WE UNDERSTAND FROM OUR JAPANESE, SOUTH KOREAN AND NATIONALIST
CHINESE COLLEAGUES HERE THAT THEIR GOVERNMENTS WILL DO THEIR BEST
TO CONVEY PROMPTLY TO THE OTHERS AN ACCOUNT OF WHAT HAPPENS
IN EACH CAPTIAL, SO WE HOPE THAT HONG KONG WILL BE IN THE PICTURE
BY THE TIME STANS GETS THERE.
F.C.O. PASS HONG KONG TOKYO SEOUL TAIPEI UKMIS GENEVA UKDEL EEC
BRUSSELS AND SAVING BRUSSELS THE HAGUE BONN BERNE PARIS ROME
MR. FREEMAN
[REPETITION TO SEOUL AND TAMSUI REFERRED FOR
DEPARTMENTAL DECISION, REPEATED AS REQUESTED TO OTHER POSTS
INTERNATIONAL TRADE DISTRIBUTION
0
COMMODITIES DEPT.
TRADE POLICY DEPT.
H.K.DEPT.
F.E.D.
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