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Section D
CONFIDENTIAL
Introduction
- 14 -
Canadian request for restraint on polyester/polynosic blend shirts
Where is the requel?
44+.
The Canadian Government has now formally requested the Hong Kong Government to exercise export restraint in respect of shirts made of woven polyester/polynosic fabrics during the remainder of the current quota year and to count such exports against the restraint limit applied by Hong Kong during the current textile year on woven shirts of 100% polyester and polyester/cotton fabrics of major weight polyester, on the grounds that:
(a) polynosic is a direct substitute for cotton
(there is in the Canadian Note an implication that shirts of polyester/polynosic should already have been made subject to restraint); and
(b) Canadian shirt manufacturers are being damaged by
imports of polyester/polynosic shirts from Hong Kong.
Statistical position
45.
Canadian import statistics do not separately list polyester/polynosic shirts in the man-made fibre sector. According to the information supplied by the Canadian Government, in the calendar year 1968 Canada imported a total of 42,027 dozen of polyester/polynosic shirts, of which 40,917 dozen or 97% came from Hong Kong. Imports of polyester/polynosic shirts from Hong Kong also represented 13.1% of total Canadian imports of man-made fibre shirts in 1968. During the first three months of 1969, Canada imported 8,723 dozen of these shirts from Hong Kong, against the total import of 20,082 dozen.
46.
Hong Kong's export figures are shown in Enclosure 12 Over the twelve months January 1968 (the earliest month for which separate statistics for polyester/polynosic shirts are availablo) to December, 1968, Hong Kong exported 47,013 dozen polyester/ polynosic shirts to Canada. This represented 35% of Hong Kong's total exports of man-made fibre shirts (132,981 dozen) to Canada during this period. From 1st January 1969 to 21st July this year Hong Kong has exported 37,602 dozen polyester/polynosic shirts to Canada.
Assessment
47.
The Department does not accept the Canadian argument on the substitutability of polynosic with cotton on the strength of the advice of the Chairman of the Hong Kong Branch of the Textile Institute that polynosic is not a direct substitute for cotton. Nor does the Department accept that it should count exports of polyester/polynosic shirts against the polyester/cotton level
since
48.
(a) there is no present agreement so to do; and
(b)
at the consultations in Ottawa last year the Canadians withdrew a request for restraint on polyester/polynosic shirts as a quid pro quo for not according growth on polyester/cotton shirts (see paragraph 8 of CAB/474 dated 7 August, 1968 reporting on the consultations in Ottawa last July).
L
However, there is evidence that Canadian shirt manufacturers are facing considerable difficulties as a result
2
CONFIDENTIAL
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