FLASH
CYPHER/CAT A
FM HONG KONG 110639Z
CONFIDENTIAL
RECEIVED IN
REGISTRY No. 51
1-. FEB 1972
FA
fo of 1412.
62
CONFIDENTIAL
/NEUTRAL/
NKK 6/548/1
LAST
REF.
TO FLASH FCO TELNO 134 OF 11 FEBRUARY.
YOUR TELEGRAM 130: COTTON TEXTILES.
NEXI
REF.
61)
63)964
I RECOGNISE THAT THE DTI HAVE COME UP WITH A PROPOSAL DESIGNED TO MEET US OVER THE FIGURE OF 10M. SQ YDS MENTIONED IN MY TELEGRAM 72. 1 AM GRATEFUL FOR THE EFFORT INVOLVED, BUT AM AFRAID THAT THE CONDITIONS ATTACHED IN (11) AND (IV) OF PARAGRAPH 3 OF YOUR TELEGRAM
MAKE IT QUITE UNACCEPTABLE. THESE TWO CONDITIONS:
(A) ARE QUITE INCONSISTENT WITH THE WHOLE CONCEPT OF SWING AS HITHERTO OPERATED IN ALL OUR RESTRAINT AGREEMENTS:
B) WOULD OPERATE IN SUCH A WAY AS SERIOUSLY TO REDUCE THE VALUE OF THE SWING FACILITY OF 12M. SQ YDS OFFERED: AND ABOVE ALL,
C) WOULD SET A VERY DANGEROUS PRECEDENT FOR US WHEN NEGOTIATING
BILATERAL AGREEMENTS WITH OTHER COUNTRIES, EVEN IF THE ACTUAL
CONDITIONS IN AN ARITHMETIC SENSE WERE NOT TOO STRINGENT.
2. AS THE PROPOSAL IS SO UNACCEPTABLE TO US THERE WOULD BE NO POINT
IN RECOMMENDING IT TO THE TEXTILES ADVISORY BOARD, ALTHOUGH WE
WILL INFORM THEM OF WHAT YOU HAVE PROPOSED. THE ONLY WAY THAT I
CAN SUGGEST TO DISPOSE OF THIS MATTER BEFORE THE SECRETARY OF
STATE'S ARRIVAL WOULD BE TO OFFER US SOMETHING WHICH AT LEAST
APPROXIMATES IN SPIRIT, IF NOT IN QUANTITY, WITH THE POSITION
SET OUT IN MY TELEGRAM 72. I REALISE THAT CROSS-SWING BETWEEN
SPECIFIC CATEGORIES IN GROUPS 11 AND 111 INVOLVES PARTICULAR
DIFFICULTIES FOR YOU, BUT AN IMPROVEMENT OF THE PRESENT OFFER
OF 4.6M. SQ YDS CF UP-SWING FROM GROUPS 111 TO GROUP IV MIGHT
JUST ENABLE US TO PERSUADE THE TEXTILES ADVISORY BOARD TO CALL IT
A DAY. IF YOU CAN TELEGRAPH THIS BY CLOSE OF PLAY TO-DAY
WE MIGHT JUST MANAGE.
CONFIDENTIAL
130
AS