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the further offer be made provided it was fully understood that no extra tonnage whatsoever would be taken by the United Kingdom. If other Member States, particularly the Germans, wanted agreement with Brazil they would have to pay for it themselves.

9. The position on Egypt lies perhaps between Brazil on the one

hand and India and Pakistan on the other. I can see the Community has important political reasons for avoiding a break with Egypt over textiles at this juncture in Middle Eastern affairs. I would suggest the UK might adopt a moderate attitude here and be prepared to take its share of any improved offer calculated strictly under the burden-sharing arrangement, no more and no less.

10.

There is likely to be Ministerial discussion of this problem early next week. EID (E) will be responsible for briefing the

Secretary of State for any such discussion. We shall also have to

brief Ministers before the end of next week for the Foreign Affairs Council on 19/20 December. I should therefore be grateful for any comments on the line suggested above by mid-day on Thursday,

8 December.

Jffiern

J A Stern

European Integration Department (External)

7 December 1977

Cc: WR Tomkys Esq, NENAD

J A B Stewart Esq, HKGD

R J O'Neill Esq, SAD

JB Ure Esq, SAmD

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