CONFIDENTIAL
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MULTI-FIBRE ARRANGEMENT
3. The Multi-Fibre Arrangement is a multilateral framework agreement
regulating international textile trade. It allows developed importing
countries some protection against disruptive surges of low-cost
imports, but in return guarantees developing countries steadily
increasing access to developed markets. It is complemented by a
series of bilateral agreements, including one between the European
Community and Hong Kong.
4.
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The original (1974) Multi-Fibre Arrangement prescribed a minimum
6% growth rate in developed country imports. The (1978) extension
protocol permitted reasonable departures' from this norm. The
European Community made use of this provision to negotiate a more
restrictive Bilateral Agreement with Hong Kong on quotas for
1978-1982. Were it not for the United Kingdom's influence on the
European Community mandate for the 1978 negotiations, Hong Kong
might have suffered even sharper cut-backs.
Hong Kong remains our
largest single supplier of textiles, and imports from Hong Kong
have in practice continued to grow at around 6% per year overall.
5. Hong Kong has been well organised and honest in implementing
its side of the European Community-Hong Kong Bilateral Agreeement.
During 1978 and 1979 a number of cases of origin fraud were
discovered. The Hong Kong authorities cooperated fully in
investigating these cases and took appropriate preventive action.
6. The present Multi-Fibre Arrangement expires on 31 December 1981
and preliminary manoeuvring is taking place on its successor. The
developing producers, including Hong Kong, point out that the original
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CONFIDENTIAL