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CONFIDENTIAL
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Senator Brock, agreed the importance of a co-ordinated approach, but stressed the importance of not isolating Japan. He hoped that the issue could be dealt with in low profile at Ottawa. felt that the West Germans, at least, were sympathetic to the idea of a "round dinner table discussion" at which the Japanese would feel less threatened. He accepted that the threat of possible Congressional action had facilitated the recent automotive restraint with Japan.
But it had to be remembered that Suzuki was a defensive "Country-boy" in a government which had a restricted view of its trade responsibilities. It cited its record on tariffs, and asserted that any other trade barriers were based on social outlook which was not its job to change. In this respect, Senator Brock recognised that the EC's export restraint concern was arguably more attractive to the Japanese than his own Administration's wish to open up the Japanese market.
Multi-Fibre Arrangement
Senator Brock looked for the MFA to be renewed in largely its present form. He felt that there should be some "clamp" on the three large producers Hong Kong, South Korea and Taiwan - to allow growth elsewhere. Whilst he was prepared to see something like zero growth for these three countries, the United States could not be expected to compromise its free trade principles to the extent of reducing their quotas. He understood that this was favoured by some EC Member States.
The Secretary of State noted that our public commitment to a "tough successor to the MFA" seemed broadly parallel to the United States stance. Textiles remained a very important United Kingdom industry, and the present recession was hardly acting to abate protectionist pressures. He felt that Hong Kong deserved some special quota treatment. Unlike Japan, for example, it was the epitome of free trade policy. Senator Brock recognised this latter point, and our "special relationship". Nevertheless, he felt that Hong Kong should be encouraged to broaden its economic base in much the same way as South Korea and Taiwan were.
The United States delegation could not be given a definite date for the completion of the EC mandate. It would certainly be no earlier than July, and it would obviously be wrong to expect a "mandate" which was either public or immutable.
The United States delegation noted that conditional EC adherence to a new MFA, subject to bilaterals, would cause legal and political problems in Washington. It was explained that over the next few months the EC would hope to conclude the maximum number of new bilaterals. But there are obvious problems in this objective, not least since some in existence ran through 1982.
The Secretary of State asked what length MFA the United States were looking for. The United States did not see more than four years as being realistic. The explanation lay with the Japanese Diet which would have to approve any longer agreement.
The United States agreed that Norway and, to a lesser extent, Canada were doubtful MFA starters. But Sweden had recently announced its intention to participate.
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