Mr Gallagher
Mr Logan
Mr Godden
Private Secretary
帕
M Gaurang
30/4/201
1 Labem.
п
th
29
IMPORT OF COTTON TEXTILES
ON 1 JANUARY 1972
TRANSITION FROM QUOTAS TO TARIFF
27
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PROBLEM
1.
Whether the Foreign and Commonwealth Office should accept
the refusal by the Chancellor of the Exchequer to include in the
Finance Bill (as proposed by the Minister for Trade) a proposal
to relieve from duty, for the first three months of 1972,
imports of cotton textiles from developing countries in the
Commonwealth Preference Area, which are shipped under quota in
1971 but do not arrive here until 1972.
ARGUMENT AND BACKGROUND
2. As Mr Noble's letter makes clear, the objective of tariff
relief would be to avoid heavy bunching of imports.
Civen the
opposition of the Commonwealth developing countries to the
tariff, the FCO agreed with this objective, but most particularly
in respect of Hong Kong.
3. The Hong Kong Government fcel strongly about the decision
to replace quotas by a tariff, arguing that if we are successful
in our application to join the 0, their exporters will, before
long, find their market in the United Kingdom controlled both by
a tariff and by quotas. In talks with Hong Kong last Cctober
and this February, we made clear that we saw no possibility of
IMG changing the decision to impose a tariff. But we said that
we were prepared to consider urgently and sympathetically ways of
excluding from the tariff cotton textiles shipped against quotas
CONFIDMIRANA,
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