0003230
G.F. 323
CONFIDENTIAL
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105.
Baron de Geer said that Sweden had overlooked what was considered to be a Hong Kong misunderstanding and had issued import licences for the shirts which had been shipped ex-quota.
106.
Mr. Bernunger said that shirts were now being made in so many different styles that dress shirts and non-dress shirts must be more or less inter-changeable.
107.
To supplement Mr. Bernunger's arguments, Baron de Geer referred to his hotel laundry list where three different classifications of shirts were specified, viz. dress shirt, sports shirt and normal shirt. Mr. Dorward informed Baron de Geer that the accepted trade classification of dress shirt was different from popular usage of the term which was the type of shirt worn under a dinner jacket. As evidence of trade usage, Mr. Tien further pointed out that in the USA/Hong Kong cotton agreement, separate specific categories existed for dress shirts and sports shirts.
108.
Mr. Ho said that judging from the figures for woven shirts of discontinuous synthetic fibres:
1967
1968
1969
Production
253
400
736
Exports
38
11
100
the Swedish industry was thriving. There was no evidence of injury. Hong Kong had every justification to feel that there would have been room for improved performance had it not been unreasonably held back by the restraint agreement.
109.
Baron de Geer was of the opinion that production trends for all shirts, irrespective of fibres, should be looked at as a whole... since these were produced by the same factories.
110.
Mr. Ho observed that the statistics provided by the Swedish delegation on production of all shirts did not match the sum total of the figures given in the various tables. Mr. Henriksson promised to re-examine the statistics and report at the next session.
111.
On the basis of Hong Kong's calculations of the total production of shirts, Mr. Ho said that he could not see how a case for restraint could be made. In 1968, total production of shirts was 3,894 and in 1969 it increased to 4,000. Baron de Geer pointed out that production fell from 5,262 in 1967 to 3,977 in 1968.
Even with 4,000 in 1969, the increase was only 21% whereas the decrease in 1968 was in the order of 25%. Mr. Ho observed that the increase in 1969 might be small in terms of volume but it might be much more in value.
112.
Mr. McEnery enquired whether it was policy to run-down the Swedish textile industry to the so-called strategic defence level, not to increase production. Baron de Geer stated that investigations in 1967 showed that production in the textile industry had already gone below that level, hence the restraints on Hong Kong, South Korea and Yugoslavia. Government studies indicated that stock-piling of textiles was not feasible. It was therefore necessary, for defence purposes, to maintain the present production level. He produced the following statistics to illustrate the decline of the industry's share of domestic consumption:
/Production
CONFIDENTIAL