RESTRICTED
NO QUANTITATIVE LIMITS ARE ENVISAGED ON ANY OF THEIR PRODUCTS BUT
THEY ARE DISAPPOINTED WITH THE EXIT FROM THE BASKET CLAUSE WHICH
MIGHT PRODUCE A QUANTITATIVE LIMIT FOR THEM AT A LATER STAGE.
THEY PROPOSED TWO ALTERNATIVES:
(A) AN AGREEMENT STATING THAT THERE WILL BE NO RESTRAINTS UNTIL THE
END OF 1980 AND THEN CONSULTATIONS ON THE 1980 LEVEL OF EXPORTS:
OR
(B) AN AGREEMENT GIVING THEM GLOBAL LEVELS OF 10,000 TONNES FOR
1980 AND 30,000 TONNES FOR 1982.
THE COMMISSION SAID THEY HAD POINTED OUT TO THEM THAT WITH
JUDICIOUS USE OF THE BASKET SYSTEM THEY COULD BUILD UP THEIR
EXPORTS TO 5,000 TONNES IN 1980.
3. HUNGARY.
THE SITUATION HAS CHANGED SINCE OUR LAST REPORT ON THE NEGOTIATIONS
WITH HUNGARY (PROGRESS REPORT NUMBER 6). EARLIER IN THE ABSENCE
OF THEIR CHIEF NEGOTIATOR, THERE HAD BEEN RAPID PROGRESS AT
TECHNICAL LEVEL. THE CHIEF NEGOTIATOR RETURNED YESTERDAY AND
SUBMITTED HIGHER FIGURES THUS UNDOING ALL THE PREVIOUS WEEK'S WORK.
THE NEW LINE IS HARD AND UNCOMPROMISING AND DOMINATED BY POLITICAL
CONSIDERATIONS.
4. POLAND.
IN CONTRAST, THE POLISH DELEGATION HAVE BEEN COOPERATIVE AND
WORKMAN-LIKE: ENCOURAGING PROGRESS HAS BEEN MADE. AGREEMENT HAS
BEEN REACHED ON MOST OF THE PRODUCTS IN GROUP 1. ON SOME PRODUCTS
THE POLISH DELEGATION HAVE ACCEPTED A LOWER GROWTH-RATE THAN THE
COMMUNITY'S COMMITTED FIGURE. ON OTHER PRODUCTS THE GROWTH RATE
HAS BEEN EXCEEDED. THE POLES HAVE POINTED OUT THAT OVERALL THEY
HAVE SO FAR BEEN GIVEN NO GROWTH RATE ABOVE 6%. THEY WERE
PARTICULARLY ANXIOUS FOR SOME CONCESSIONS IN THREE PRODUCTS IN
GROUP 2 IN RETURN FOR THE REDUCED FIGURES THEY HAD AGREED FOR
COTTON YARN. THESE REMAINING PROBLEMS WILL BE DISCUSSED AT A
RESTRICTED 113 MEETING THIS AFTERNOON. THE COMMISSION NEGOTIATOR
SAID THAT HE WAS INCLINED, IF THERE WERE NO OBJECTIONS FROM MEMBER
STATES, TO INCREASE SOME OF THE POLISH FIGURES BY ADJUSTING
DOWNWARDS THE HUNGARIAN FIGURES.
2 RESTRICTED
/5. THE UK