TNAG-0116-FCO40-152-Departmental-Briefs-For-Meetings--Visits-and-Foreign-Affairs-1969 — Page 32

STANS

ANNEX

Japanese Reactions to the Stans' Proposals.

In February of this year it became evident that the the Japanese

were worried about the possible sequel to the U.3. President's election

promise of action to alleviate the problems of the U.3. textile industry,

which was alleged to be suffering the effects of increasing import

penetration of the home market. The Eapanese were concerned in

particular that the President might use his imminent European tour to

influence the Governments concerned to weaken their opposition to textile

trade restraints. H.M.G. indicated at that time that the U.K. would

stand firm in opposing restraints, and it appears that other European

Governments also inximum resisted any suggestions of this nature.

Some weeks later an impending tour by the U.S. Secretary of

Commerce (Mr. M. Stand) was announced and it was widely rumoured that he

would try zax to eecure the consent of participating countries to the

holding of a GATT meeting to discuss the question of new restrictions on

such

textiles. The Amercian argument for/action was, apart from the obvious

political commitment, that low-cost textiles were flooding the home market

and that if the problem were not dealt with quictly by international

agreement, Congress would ensure that much fiercer action be taken to

protect U.S. interests. The Japanese informed us that their opposition

to such a meeting was based primarily on the following reasons:

a) the move would inhibit the expansion of trade in an already

difficult world situation

b) the L.T.A. specifically states that it is intended to deal with

the special problems of the cotton textiles and not to be

considered as lending itself to application in other fields;

any discussion with general textile restraints in view rould be

in breach of this understanding.

c) so many major countries had already expressed opposition that the

meeting would blearly be unfruitful.

When Stans arrived in Japan during May he pressed for voluntary

restraint of textile exports and apparently claimed that the U.S. did not

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