TNAG-0136-FCO40-172-Tariff-preferences-for-developing-countries-1970 — Page 28

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the U.S. delegation in view of the Community's blatant

attempts previously to gain political capital with the LDCs

at the expense of the Americans (see my memorandum under

reference).

4. The U.S. submission envisages zero preferential duties

with no quantitative limitation on all products in Chapters

25 - 99 of the B.N. with the exception of textiles, shoes and

petroleum products. Safeguards would be operated by a standard

escape clause procedure and adjustment assistance.

But the

scheme is based on three premises, namely -

(a) that it will be a common scheme adopted by all major

developed countries,

(b) that existing preferences will be merged into the new

scheme on all products covered by it (e.g. developing

countries still receiving special preferences would

be excluded from preference in the U.S.) and

(c) likewise developing countries still granting reverse

preferences would be excluded from preferences in the

U.S.

The position on beneficiary countries is left open.

5.

Naturally, the EEC were furious at this new development as

not only does it show up their scheme for tariff quotas as being

less forthcoming but it is also designed to put pressure on

all their special preferential arrangements.

(For that matter

the conditions put forward also have the effect of threatening

Commonwealth preference). The EEC's reaction has been that

it is impossible at this stage to alter their scheme and that

attempts to get all major donors to adopt the same scheme will

only lead to unnecessary delays in the introduction of

preferences.

6.

Its

The new Japanese submission was a different affair and it

came as somewhat of an anticlimax when it finally emerged.

genesis was a Japanese conviction that the EEC approach of tariff

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/quotas