in principle should be taken to reintroduce duty-free quotas an

respect of any supplier whose exports to us are limited by virtue of

our adherence to the Community's Article 4 agreements.

7. The arguments which appear, at the end of paragraph 7 of

AS(71)35, to rua counter to this view seem to Mr sood to be contra-

dictory. The admission of duty-free textiles in 1973 would not put

our own textile firms in any worse position than they are now. Whatever

investment decisions they have made can have been taken in an atmosphere

of certainty only as regards 1972 und 1973. The real answer to the

problem is for us to secure free circulation of all textiles within

the enlarged Community, and we should have a very good chance of getting

our way on this in the Community's discussions on future textile policy,

which must inevitably take place in 1373 in preparation for renegotiation

of the Long Term Agreement.

i

3.

A

:

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