0
15.
What then are the particular trade problems which face us in 1980? First, there is of course a particular problem about textiles and clothing. I know you have strong feelings about the agreement which the EEC negotiated with you under the MFA. It was a tough agreement which involved your accepting cutbacks from the levels of trade and from rates of growth to which you would have
been entitled under the MFA but for EEC insistence on the concept of "reasonable departures" from its provisions. But you were prepared to be realists and to accept a less than ideal arrangement for yourselves in return for the security which it offered. That security is important and I can say that the United Kingdom, and I confidently believe the Community, will not ask to go back on that agreement despite the worsening in the economic situation that faces us. And that will remain our position even if other major countries seek to go back on the agreements which they negotiated with you.
16.
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We shall before long need to start considering what agreements should succeed the present MFA, and the bilateral agreements under it, which expire at the end of 1981 and 1982 res- pectively. Conditions differ materially today from those prev- ailing at the time the present MFA framework was concluded; and, in a changing situation, I can see no benefit to anyone in trying to arrive at premature conclusions on any new regime. The market for textile goods within the United Kingdom has been sluggish actually falling in recent months. There are continuing changes in fashion and technology. These factors have contributed to a quarter of a million people moving out of the industry in the seventies despite strenuous efforts by the UK industry to meet those challenges. Mills are closing. I am not saying that this is entirely a problem of imports. But with the penetration of the UK market in some sensitive areas now running as high as 80% imports are clearly a major factor in the situation, But I would be less than frank if I did not say, first, that in our view management of textile imports will continue to be necessary; and, second, that we regard adherence to the existing agreement as essential in the meantime.
17. So much for imports. But the problem is just not one way. Hong Kong has a free trade policy. I congratulate you on it.
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