Entucky
agred.
HK WOULD.
futrals agrad
of the Article is also being proposed it would scen less likely that these conditions could
simultaneously be satisfied by a number of coun-
tries.
(b) It is difficult to see that even if GATT agreed on clarified and strengthened procedures under Article XIX, bilateral voluntary restraint arrangements would necessarily be eliminated. We probably do not even
get to hear of all the voluntary restraint arrangements
If a country that are made, at any rate until long after.
chooses to restrain its exports to another country rather than provoke an Article X1X confrontation, it is difficult
to see what CATT objection there can be or in what terms
GATT could effectively record any understanding about "gentlemen's agreements"
(c) Even if Hong Kong were convinced (as she is not at present) that her interests lie in avoiding all voluntary restraints and thereby promoting the general opening up of markets, before agreeing to abandon all volun- tary restraints, Hong Kong might well seek assurances from us that we would guarantee her against the consequences of driving other countries, such as Canada, to take unilateral
measures against Hong Kong. We might perhaps undertake to challenge such action in the GATT, but the challenge might well not be upheld, given Hong Kong's general unpopularity
as an outsider of both the clubs of the developed and
developing. If the challenge were not upheld, the example would be disastrous to Hong Kong, and even if retaliation by the U.K. on Hong Kong's behalf were legally in order (as it is not) it might have to be on an unacceptable scale
and even so unavailing.
х
23. Apart from these disadvantages two tactical difficul- ties in taking this line should be recorded:
(a) is smale, more
thean a
difficulting".
"Factical
(a) Given the political rather than industrial
nature of the U.S. textile problem, it seems most unlikely that the U.S. could in the foresceable future agree either to deal with her own problems
under Article XlX, or to accept a procedure which would tighten up the conditions for the imposition of restrictions on textile imports, and perhaps
subject them to approval by a GATT panel. It will certainly be a matter of long uphill argument to convince developed countries in general that they
/should
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