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We anticipate that negotiations with the EEC to determine future arrangements to succeed our present
agreement, which runs out at the end of this year, will
commence in late September. It will be apparent from what
I have just said that these may not be easy. Since so
much seems to hang on the question of growth, however, let me make one point which may, or may not, give some reassurance.
Our major markets in the EEC, by far, are the United Kingdom and Germany. The EEC has already indicated that there are
seven categories of textiles which are particularly sensitive and where they will be seeking growth rates much lower than the 6 per cent provided for in the present Multi-Fibre
Arrangement. It is, however, a fact that under the present
agreement between Hong Kong and the EEC, annual growth on
UK quota limits for all of these items bar one is one half
of one per cent; and for the other item it is about three and
a half per cent. For Germany, the figures for the only five categories where there is any significant trade range
And for the Community as a
between 0.5 and 2.3 per cent.
whole the annual growth ranges from 2.5 per cent for five
of the items to 7 per cent for the other two. I conclude
that there is little scope for reduction there, even if the conceptual case for it was stronger than it is.
The EEC negotiations lie in the future and
there is, regrettably but unavoidably, uncertainty about
their outcome. On a more positive note, however, I can say that we have reached a provisional agreement with the United States for a period of five years commencing
January 1978. This agreement was concluded some weeks ago
and I am acutely conscious of the frustration in business
/circles