TNAG-0143-FCO40-179-Exports-of-textiles-to-United-States-of-America-1969 — Page 116

CYPHER/CAT A

CONFIDENTIAL

PRIORITY HONG KONG TELNO 8 TO WASHINGTON

CONFIDENTIAL

[NEUTRAL].

YOUR TELEGRAM 7.

FOLLOWING FOR HERMANN,

TEXTILE CONSULTATIONS.

THE PACKAGE IS INCOMPLETE AND UNACCEPTABLE.

Jur COPY

1 MARCH 1969

LAST

R F

4.2.

78

2. WE CANNOT AFFORD TO ENCOURAGE THE AMERICANS TO SEEK REVISION OF

THE AGREEMENT (THEIR PROPOSAL ON TOWELS IS IN EFFECT AN ARTICLE 3

REQUEST CONTRARY TO PARA. 17 OF THE AGREEMENT AND WITHOUT THE

SUPPORTING EVIDENCE REQUIRED UNDER ARTICLE 3L BY MIGUSING THE

PROVISIONS OF PARA. 8 OF THE AGREEMENT.

3. THE LIMITS FOR THE THRES TRIGGERED ITEMS SHOULD BE ESTABLISHED

ON THE MERITS OF THE CASES CCF PARA 1 OF YOUR TELEGRAM 580. ALTHOUGH

WE ACCEPT THAT THE AMERICANS CAN IN THE LAST RESORT DETERMINE THE

LIMIT, WE CAN UNDERLINE NEXT WORD AGREE ONLY IF THE MERITS ARE

ESTABLISHED.

4. IF THEREAFTER THE AMERICANS WANT A NEW SPECIFIC LIMIT CH CERTAIN

TOWELS THEN THEY SHOULD OFFER A COMPENSATING ADVANTAGE TO US AND IF

IT IS TO BE IN THE TRIGGERED CATEGORIES IT SHOULD INVOLVE HIGHER

LIMITS THAN THOSE ESTABLISHED ON THE MERITS OF THOSE CASUS,

5. I THINK WE MUST DISTINGUISH BETWEEN AN AGREEMENT ON TRIGGERED

CATEGORIES, WHICH COULD BE QUOTED AGAINST US AS A PRECEDENT, AND A

LIMIT IMPOSED ON US. EITHER WAY WE EXPECT THEM TO APPROACH TRIGGER

POINT CONSULTATIONS IN THE LIGHT OF THEIR OWN REMARKS IN THE 1966

NEGOTIATIONS (PARAS. 126, 212, 248 OF ENCLOSURE 3 TO BRIEF SENT

WITH DORWARD'S LETTER OF 9 OCTOBER 1958).

6. IN THE ABSENCE OF ANY EVIDENCE TO SHOW THAT ALLEGED UNDUE CON-

CENTRATION IS INJURING U.S. INDUSTRY (PLEASE EMPHASISE THIS), WE ARE

KOST RELUCTANT TO UNDERLINE NEXT WORD AGREE ANYTHING BELOW THE

FOLLOWING FALL BACK POSITIONS.

RECEIVED IN ARCHIVES No.31

CONFIDENT IA L

3 MAR 1969