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(c) it would make much more difficult the planned programme of liberalisation for Japan;
(a) our position as regards Portugal is particularly delicate. The agreement on cotton textiles has been secretly abrogated and there are now signs that imports are rising. The Swedes have an
agreement with the Portuguese covering three important cotton items
and man-made fibre blankets. We are ourselves being pressed on
this last item and if the Swedes extend controls to other m.m.f.
imports from Portugal we would almost certainly have to follow their
example as well as to re-impose controls on cotton textiles.
2.
Industries 1 also differ from CRE1 in their view or what
constitute legitimate grounds for the imposition of restrictions on
imports. The L.T.A. has a comprehensive definition of what constitutes
market disruption. But it was left to importing countries to decide
when the conditions had been met and as a result the definition has
been progressively ignored. That is why the Americans are so keen to get the L.T.A. extended to all textiles and clothing. The only
provision which can be legitimately invoked to impose controls on
non-cotton textiles is Article XIX of the G.A.T.T., but in this case
the importing country has to show that imports have caused or threaten serious injury to domestic producers of like or competitive products; and any restriction which is imposed on imports must be non-discriminatory
as between supplying countries, who, in turn, have the right of
retaliation.
CRE1 are now arguing that the Swedes are entitled to
impose restrictions where, for example :-