TNAG-0145-FCO40-181-Exports-of-textiles-to-United-States-of-America-1969 — Page 5

DRAFT

Page

RESTRICTED

194/€

THIS DOCUMENT IS THE PROPERTY OF HER BRITANNIC MAJESTY'S GOVERNMENT

NVS (69)9

Copy No:

Meeting between the Prime Minister and President Nixon

3rd August 1969

American Trade Policy under the New Administration

(including textiles)

Brief by Board of Trade

Since the war the underlying basis of United States trade

policy, like that of the United Kingdom, has been to increase

prosperity and raise the standard of living through the development

of open and non-discriminatory trading. President Nixon has

repeatedly committed himself to free trade policies and has said

that he takes a "dim view" of the tendency to move towards quota

restrictions. He has however also stated that non-cotton textiles

represent a special case (cotton textiles imported from low-cost

countries are already restricted under the LTA).

President Nixon is not the first (American) President to give

pre-Election pledges to the textile industry without knowing all

the facts of the situation. Both Kennedy and Johnson did the

same and later found they could not implement their promises.

Apart from the internal political problems involved, the American

case for general restraint of textile imports is a very weak one.

The U.S. industry apart from one or two black spots is generally

prosperous; imports do not represent a large proportion of total

consumption, nor have they grown inordinately having regard to the

booming state of the U.S. economy; to take action to restrict

textile imports in these circumstances would open the door to a

world wide spread of protection, and to concentrate restrictions on

imports from countries such as Korea, Taiwan and Hongkong would be

a blow aimed at developing countries, who particularly need to

develop their export trade.

1

RESTRICTED