TNAG-0147-FCO40-183-Exports-of-textiles-to-United-States-of-America-1969 — Page 6

CONFIDENTIAL

2

OF THE TEXTILE PROBLEM.

4. THE PROPOSED EASING OF ESCAPE CLAUSE CRITERIA AND EXTENSION OF U.S. RETALIATORY POWERS MAKE THIS A LESS DESIRABLE PACKAGE OF ELGISLATION FROM THE POINT OF VIEW OF U.S. TRADING PARTNERS. THE

TARIFF COMMISSION HAS DEMONSTRATED PEMARKABLE INCONSISTENCY IN

INTERPRETING THE EXISTING CRITERIA BUT WILL RESUMABLY BE FAIRLY

EASILY CONVINCED THAT INCREASED IMPORTS ARE THE PRIMARY CAUSE OF

INJURY TO A DOMESTIC INDUSTRY. IF SO, ESCAPE CLUSE ACTIONS MAY

PROLIFERATE. IF THE LEGISLATION IS ENACTED THERE WILL ALSO BE CONSIDERABLE PRESSURE ON THE ADMINISTRATION AND WITHIN IT TO USE THE NEW RETALIATORY POWERS AS A DECLARED THREAT TO OTHER COUNTRIES.

THE PRESIDENT'S OBJECT IS TO STRENGTHEN HIS NEGOTIATING STANCE, BUT OTHER COUNTRIES MAY NOW WELCOME THREATS OF U.S. ACTION GOING BEYOND WHAT IS PERMISSIBLE UNDER THE G.A.T.T. IT WOULD

FROBABLY BE BETTER FOR ALL CF US IF FUTURE U.S. ADMINISTRATIONS

DID NOT HAVE SUCH FAR-REACHING POWERS.

*

F.C.O. PASS UKNIS GENEVA UKDEL BRUSSELS HONG KONG AND SAVING TO

UKDEL OECD TOKYO BONN ROME AND PARIS.

MR. FREEMAN.

[REPEATED AS REQUESTED]

INTERNATIONAL TRADE DISTRIBUTION

TR. POL. DEPT.

AMERICAN DEPT.

GGGGG.

CONFIDENTIAL