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UKMIS GENEVA TELNO 551 TO FCO
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WE POINTED OUT THAT THE LINK BETWEEN IMPORTS AND SUCH LOSS OF JOBS AS HAD OCCURRED SEEMED TENUOUS. THERE WAS EVEN LESS ATTEMPT TO DENY THE FAVOURABLE PICTURE OF RISING PROFITS, SALES AND PRODUCTION EXCEPT TO CLAIM THAT PUBLISHED STATISTICS DID NOT COVER PRIVATE TEXTILE FIRMS AND REVEALED ONLY PART OF THE STORY: NON-PUBLISHED SURVEYS SHOWED THAT PRIVATE FIRMS WERE FARING WORSE THAN PUBLIC COMPANIES.
6.OUTLINING THE U S PROPOSALS ON THE FORM OF THE COMPREHENSIVE BILATERAL AGREEMENT PROPOSED, NEHMER INDICATED THAT MMF AND WOOL WOULD BE SEPARATE, THAT FOR EACH THERE WOULD BE GROUP CEILINGS FOR APPAREL AND OTHER GOODS, AND THAT WITHIN THESE CEILINGS SOME CATEGORIES WOULD BE ALLOTTED SPECIFIC LEVELS OF RESTRAINT. THESE CATEGORIES WOULD BE CONSIDERABLY LESS IN NUMBER THAN IN THE EXISTING COTTON AGREEMENT (WHICH THEY WERE PREPARED TO RENEGOTIATE AS PART OF THE BARGAIN). THE INCLUSION OF THE OVERALL CEILING WAS 1IN HIS VIEW ESSENTIAL TO THE WHOLE CONCEPT IN THE LIGHT OF THE ABILITY OF HONG KONG AND OTHER ASIAN GARMENT MANUFACTURERS TO SWITCH RAPIDLY FROM PRODUCTION OF ONE ITEM TO ANOTHER. GROWTH FACTORS WERE NEGOTIABLE, IN GENERAL HE EXPECTED GROWTH TO BE OF THE ORDER OF WHAT HAD OCCURRED IN COTTON (WHERE THE IMPORT/CONSUMPTION RATIO HAD MORE THAN DOUBLED SINCE THE LTA WAS SIGNED)..
7. WE REITERATED THAT DISCUSSION ON THESE POINTS WAS PREMATURE AND THAT TIME WOULD BE NEEDED TO ASSESS THE POSITION AGAIN IN THE LIGHT OF THE COTTON TEXTILES COMMITTEE MEETING AND OF THESE DISCUSSIONS BEFORE WE COULD DRAW ANY NEW CONCLUSION ON THE FACTS OF THE SITUATION. AT PRESENT WE COULD GIVE NO REACTION. NEHMER ACCEPTED THIS BUT WENT ON TO ARGUE THAT THE BILATERAL ARRANGEMENTS ON NON-COTTONS ALREADY AGREED WITH CANADA, SWEDEN AND NORWAY SEEMED TO BE A PRECEDENT FOR THE TYPE OF ARRANGEMENT HE NOW PROPOSED. IN THOSE CASES PROBLEMS OF PRINCIPLE IN GATT TERMS HAD NOT SEEMED TO BE INSUPERABLE. WE POINTED OUT THAT NONE OF THESE AGREEMENTS WAS COMPREHENSIVE AND THAT RESTRAINT HAD BEEN CONCEDED ONLY WHERE SERIOUS INJURY HAD BEEN DEMONSTRATED. THE CONCEPT OF A COMPREHENSIVE AGREEMENT PRESUPPOSED RESTRAINT IN CASES WHERE NO INJURY NOR EVEN THREAT OF INJURY EXISTED. THIS WOULD BE DIRECTLY OPPOSED TO GATT PRINCIPLES. THE FACT THAT MANY QUOTE ARTICLE 4 UNQUOTE COTTON BILATERALS WERE COMPREHENSIVE WAS NO PRECEDENT SINCE IN THOSE CASES THERE WAS A MULTILATERAL ARRANGEMENT WHICH PROVIDE THE BASIC FRAMEWORK.
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