:
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products under Article XIX and the Swedes have always maintained that, in the event of our refusing to allow Hong Kong to enter into a bilateral agreement, they would be prepared to justify the imposition of restrictions under Article XIX and that these restrictions would be non-discriminatory.
Failing
this we would be entitled under the Decision of
19th November 1960 to raise the matter ourselves on the grounds that the action taken by Canada and Sweden would "tend to cause difficulties in our market".
34.
Consultations on, e.g., shirts under Article XIX of the G.A.T.T. would probably raise procedural and other problems of the kind discussed in 1960. The balance of political and economic power has shifted a good deal since then and it is unlikely that the Asian countries will be as ready as they then were, in 1962 to agree to a controlled expansion in their trade. Consideration should therefore be given to the setting up of a panel or other independent authority to regulate the use made of Article XIX.
Exports
35.
It has been suggested that the non-discriminatory use of Article XIX would be contrary to the U.K. interest
an exporter. The answer to this is that:-
a) in the longer term our interest as an exporting country is in freer trade all round; b) in the short term we might save more on imports than we would lose on exports, e.c. in the case of shirts, where the volume of imports is twenty times greater than the volume of exports; c) our exports might not be directly competitive with in ports from low-cost countries. If so, the importing country would not have a case for restricting them. If not, we would have little
chance of expanding our trade against low-cost competition in the market in question.
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