Weakness of the innalin case
بار
The case falls short of what we would look for to justify seekin new import restricti ms. Curut import penetration is bout the same as that into the Six: being 139% of consumption, of which slightly less than half cones from the quote controlled countries. On the industry's own estimate, removal of the quotas wild still leave at least 72 per cent of the market for the domestic industry in 1975. The effect of ending the quotos on numbers employed (34,360 in June 1973) would not be very large. It is estimated that 700 jobs would be lost in 1974 and 1975, in addition to the 1900 which are likely to disappear anyway by the end of 1975 because of the expected increase in uncontrolled imports.
The industry's argument that it needs protection for all stages of production has less force when applied to the first production stage (yarn) than to following ones; removal of restrictions would give the weavers a wider choice among suppliers of cheap yarns, with subsequent benefits in the production and use of cloth.
Adverse effects of liberalisation with no transition Against the foregoing, there are a number of reasons for going some way to meet the industry. The industry is in essence asking for time to cope with the effects of the trade harmonisation measures of the Community; in particular liberalisation and teriff reductions in favour of the Mediterranean associates. Much of the Six's considerable growth in recent years in total yarn morts has come from the Mediterranean Associates, which are expanding their spinning industries and can be expected in due course to turn their attention to the UK market, to which they have recently gained unrestricted access. At the same time it is unlikely that the UK's major traditional yarn suppliers (India, Pakistan, Hong Kong) will relax their attention to this market. In addition a proportion of yarn imports (but admittedly a small proportion) will enter the UK duty-free as from the beginning of 1974 under the EEC's generalised preference scheme. Better treatment will also be afforded to Eastern Area countries. The UK industry vill therefore 'be exposed in the future to an enhanced degree of competition
this at a time when we expect in 1974 and 1975 the textile cycle to have reached a dangerous point for producers in industri:ised countries.
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