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Reference
Miss Welch has produced a very full analysis of the latest Swedish proposals for restraint on Hong Kong's exports of non-cotton textiles. In brief, what the Swedes are asking for is:-
a) Continuation of restraint on mmf anoraks (men's and women's), with the addition of discontinuous fibre anoraks for women and girls (not previously restrained) at a nuch reduced level (4.50,000 pieces including women's and girl's discontinuous instead of the ›rėvious annual level of 795,0
000 pieces excluding women's and girl's discontinuous).
b) Continuation of restraint on women's and girl's wool and synthetic knitted outerwear, and men's and bo's wool knitted outerwear,(with the exclusion of women's and girl's continuous fibre sweaters which were previously restrained at an annual level of 1,981,000 prices compared to the previous level of 2,238,000 pieces for a slightly higher coverage.
c) New restraints for women's and girl's knitted continuous mmf underwear (previously subject to FA -the coverage of this item is uncertain and the figures doubtful.
d) New restraints for woven synthetic blouses (previously subject to EA).
e) New restraints for polyester/cotton shirts (previously subject to EA).
f) New export authorisations for men's and boy's discontinous fibre sweaters.
2. I cannot add to Miss Welch's analysis fo the relevant figures. On the assumption that we are prepared in principle to agree to extension of the existing restraints, then my comments on the merits of the Swedish proposals would
be:-
Anoraks
Total Swedish production of synthetic anoraks, male and female (accapted as being interchargeable) has fallen slightly between 1967/68 (though it rose substantially between 1966/67) from 874,000 pieces to 800,000. Imports have risen in the same period from 681,000 to 1,010,000 pieces, with Hong Kong accounting for about half in each case. There has also been a heavy fall in Swedish production of cotton anoraks and a rise in imports, though the Swedes are prepared for Hong Kong not to renew restraint on these cotton items (of which Portugal is now the major supplier).
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This seems to me to add up to a case for continuing restraint at not less than the existing level, and for adding women's and girls discontinuous to the restrained items with an appropriate increase in the “restraint level" There seems no justification for any cutback; and since the Swedes themselves have apparently proposed that restraint levels should be "determined on the lines of Annex B to the CTA" (para. 8 of Hong Kong telegram 339), there ought to be an increase over last year.
Knitwear
Total Swedish production of both men's and women's wool knitwear has been declining steadily since 1965 with a further big drop between 1967/68, and is heavily outweighed (about seven to one) by imports. Hong Kong has far the lion's share of imports of women's garmenta, and aḥmit hàlf that of men's. Production of discontinuous synthetic women's and girls! garments halved between 1967/68; impo ts also fell but far exceed imports. In this case, South Korea is much the largest supplier, followed by Hong Kong, whose share is rising. Laports from South Korea are already controlled.
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