CRS 1200
IMMEDIATE
CYPHER CAT/A
FM HONG KONG 181050Z
CONFIDENTIAL
CONFIDENTIAL
(i)
Е
TO IMMEDIATE F C O TELEGRAM NO 388 OF 18 APRIL.
MIPT.
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FOLLOWING IS EXTRACT FROM SPEECH:-
HKK 121/616/1
THIS ARRANGEMENT HAS PROVIDED THE FRAMEWORK FOR THE NEGOTIATION OF ALL OUR BILATERAL TEXTILE AGREEMENTS. AS THE FINANCIAL SECRETARY MENTIONED IN THE BUDGET SPEECH ABOUT TWO-THIRDS OF OUR TEXTILE AND CLOTHING EXPORTS ARE CONTROLLED
UNDER THESE AGREEMENTS. THAT'S ABOUT ONE-THIRD OF OUR TOTAL
EXPORTS, PRODUCED BY ABOUT ONE-THIRD OF OUR INDUSTRIAL WORK
FORCE.
FOR THE DEVELOPING COUNTRIES THAT EXPORT TEXTILE PRODUCTS
THE M F A ITSELF REPRESENTS IN TECHNICAL TERMS A DEROGATION FROM
THEIR G A T T RIGHTS. IN PLAINER LANGUAGE THAT MEANS THAT
UNDER THE MFA THEY CAN BE COMPELLED TO ACCEPT RESTRICTIONS ON
THEIR TEXTILE EXPORTS THAT COULD NOT BE JUSTIFIED OR IMPOSED IN THE SAME WAY UNDER THE G A T T ITSELF. THE GATT IS THE GENERAL AGREEMENT ON TARIFFS AND TRADE, AND MOST OF THE WORLD'S
TRADING COUNTRIES ARE PARTIES TO IT.
THE BASIS OF THE MFA IS THE CONCEPT OF MARKET DISRUPTION''.
WHERE AN IMPORTING COUNTRY CAN SHOW THAT ITS DOMESTIC INDUSTRY
IS BEING SERIOUSLY DAMAGED OR IS ACTUALLY THREATENED WITH SERIOUS
DAMAGE BY A SHARP AND SUBSTANTIAL INCREASE OR IMMINENT INCREASE
OF IMPORTS OF PARTICULAR PRODUCTS FROM PARTICULAR SOURCES AND
AT PRICES SUBSTANTIALLY LOWER THAN THE PREVAILING LEVEL WHERE
AN IMPORTING COUNTRY CAN PRODUCE EVIDENCE OF THIS THL EXPORTING
COUNTRY CONCERNED IS OBLIGED TO AGREE TO LIMIT ITS FUTURE EXPORTO
AND IF IT REFUSES TO DO SO THEN THE IMPORTING COUNTRY CAN REFUSE
TO ACCEPT THE DISRUPTIVE IMPORTS.
CONFIDENTIAL
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