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(e) Group 2
Increase by 15 per cent Categories 4, 5, 6 and 7 (the rationale would be as for Group 4, ie the pre-1966 method of dealing with excess yardage). (f) Group 1
Merge the two categories.
C An upswing and cross-swing as for the EEC proposition.
7.
Mr Haddon-Cave maintained that the proposal did not increase the total yardage. It was agreed that the DTI would look at these proposals and we would meet the visitors again at 5 p.m. on 13 January (we shall hold a briefing meeting at 10.30 today).
THE MULTIFIBRE CONCEPT
8.
Having given general views on the 2 Hong Kong positions, Mr Ridley, whilst making it plain that he had no authority from Ministers and that what he was saying would need to be discussed with the Community, said that it would be much easier for us to consider problems such as those thrown up by Hong Kong if the approach was on a multifibre basis. For example, it might then be possible to increase restraint limits on certain products as well as providing for both a growth element and an aggregate performance figure based on past pattern for cotton and non- cotton textiles. In many ways such an approach would seem in Hong Kong's interests. There was pressure in a number of places for orderly marketing arrangements on textiles, not least because the main growth in imports had been in the man-made fibre sectors. Obviously we would wish to consider such problems in a more orderly manner than was the case with cotton textiles. Mr Ridley did not wish to discuss details but wondered what Hong Kong thought of the broad concept.
9.
Mr Haddon-Cave reacted violently, saying that he had no authority to talk non-cotton textiles; could not accept that the request by Hong Kong for amelioration of the effects of our decision on cotton textiles could be tied to anything else and that Hong Kong was not prepared to agree restraints on non- cotton textiles unless these met the normal international criteria. He doubted whether multilateral discussions on an extension of the LTA would be successful, although he repeated the earlier Hong Kong views that the only reasonable solution was a narrow extension of the LTA to specific products for which a proven case was made. This would be a gradual process which might end with a comprehensive multifibre LTA but certainly this should not be the starting point.
10. Mr Ridley made it plain that his concept was not one of comprehensive restraint but Mr Haddon-Cave said that he was not prepared to discuss this subject now and it would have to be a separate exercise from the talks on cotton textiles.
13 January 1972
II EJ HALE
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