XN000022-1987-02-20 — Page 4

EN

FRIDAY, FEBRUARY 20, 1987

MACLEOD EXPRESSES CONCERN OVER U.S. TEXTILES BILL

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THE DIRECTOR OF TRADE, MR HAMISH MACLEOD, SAID THIS (FRIDAY) EVENING THAT AN INITIAL READING OF THE NEW TEXTILES BILL INTRODUCED INTO THE UNITED STATES CONGRESS YESTERDAY (THURSDAY) SHOWS THAT IT GOES MUCH FURTHER THAN ITS SPONSORS HAVE REVEALED AND WOULD BE IN STARK CONFLICT WITH INTERNATIONAL TRADE RULES.

COMMENTING ON THE BILL, MR MACLEOD SAID: +CLEARLY WE NEED TO STUDY THE DETAILS FURTHER, AND ALSO ASSESS ANY FURTHER STATEMENTS MADE BY THE SPONSORS OR OTHERS IN THE UNITED STATES. HOWEVER, SOME PRELIMINARY COMMENTS CAN BE MADE NOW.

J

+FIRST, IT IS VERY DIFFICULT TO SEE HOW THE PROVISIONS OF THE BILL COULD BE IMPLEMENTED WITHOUT ABANDONING THE MULTI-FIBRE ARRANGEMENT AND ALL THE BILATERAL TEXTILE AGREEMENTS SO PAINFULLY NEGOTIATED RECENTLY. WHAT WOULD REPLACE THIS SYSTEM IS NOT MADE CLEAR BUT, FOR EXAMPLE, OPTIONS COULD INCLUDE IMPORT QUOTAS, WHICH WOULD BE A RADICAL DEPARTURE FROM EXISTING ARRANGEMENTS.

+SECONDLY, ALTHOUGH THE BILL IS PRESENTED AS IF IT COULD BE JUSTIFIED UNDER THE GATT, I CANNOT SEE ANY WAY IN WHICH THIS COULD IN FACT BE SO. FOR EXAMPLE, THE BILL INVOLVES A BLANKET ASSUMPTION OF SERIOUS INJURY ACROSS AN ENTIRE INDUSTRY, BYPASSING THE MACHINERY WHICH EXISTS IN THE UNITED STATES FOR ASSESSING INJURY, AND MAKING PERHAPS WISELY, SINCE NO ATTEMPT TO CARRY OUT SUCH AN ASSESSMENT

THE FACTS DO NOT SUPPORT SUCH AN ASSUMPTION.

+THE BILL ALSO UNILATERALLY PRE-LIMITS THE COMPENSATION WHICH COULD BE PAID, AND IGNORES THE FACT THAT IF SUCH COMPENSATION IS NOT MUTUALLY AGREED THEN UNDER THE GATT, RETALIATION IS THE NEXT OPTION AVAILABLE.

+LIKE ITS PREDECESSOR, THE JENKINS BILL, THIS PROPOSAL IF IMPLEMENTED WOULD PUT AT RISK THE WORLD TRADING SYSTEM PARADOXICALLY, TEARING UP INTERNATIONAL OBLIGATIONS AT THE VERY TIME WHEN A DETERMİNED EFFORT IS BEING MADE IN GENEVA TO DO THE VERY OPPOSITE AND TO STRENGTHEN THE INTERNATIONAL TRADING SYSTEM.

+AN URGENT APPRAISAL OF THE FULL IMPLICATIONS OF THE BILL AND OF HOW BEST TO COMBAT IT IS BEING CARRIED OUT IN CONSULTATION WITH OUR STAFF AND ADVISERS BOTH HERE AND IN THE UNITED STATES.+

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