TNAG-0146-FCO40-182-Exports-of-textiles-to-United-States-of-America-1969 — Page 181

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Scottish fashion knitwear to be lumped in with a quota on cheap Asian sweatc-g.. It was important to foresee this kind of difficulty, which could easily lead to a breakdown of the common front against U.S. textile protectionism which has so far proved so effective. Danicls scomed well aware of the risks. He said he envisaged bilateral approaches by the U.S. to the countries whose particular products were threatening serious injury with a view to acceptance by then of voluntary restraints; in other words the solution would follow the spirit rather than the lotter of Article XIX. I felt I should not argue the point further without fuller consideration. It seems to me, however, that although such a procedure might initially let us off the hook it still carries two dangers: the United States would be able to tackle their victims one by one;

and bilateral deals could hardly fail to give rise to suspicions that one exporting country was doing a deal at. the expense of others. If it were possible, therefore, it might be better to try to devise through GATT an agreed procedure which could be applied to individual countries and individual products but subject to a strict reporting and scrutiny system in GATT. An essential element would be to. require the United States to demonstrate and justify their.. claims of injury.

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We are keeping our ears to the ground and às soon as we have more definite information I will let you know. the meantime Senator Hollings' energetic attempts to help the textile cause continue. He announced yesterday in the Senate that he would shortly introduce an amendment to "en appropriate bill" (presumably the tax surcharge bill) providing a legislative solution "not only to the textile import problem, but also to the problems besetting any other Amerian industry which is being harmed in its employment or economic health by excessive import competition". So much for Stans' claim that textiles are.. unique.

P. W. Ridley,

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