TNAG-0154-FCO40-190-Exports-of-cotton-textiles-to-Canada-1970 — Page 55

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trousers this year was making a nonsense of the restraint

and that it should therefore not be renewed. Jones

replied that Hong Kong, on the contrary, felt strongly

that it would be better to let the restraint run on.

4. On SHIRTS Stewart tried first of all to bring in

the factor that Canadian production of knitted shirts

was increasing. Jones pointed out that knitted shirt

production in Canada was very small less than a tenth

W

of woven shirt production and that the fall in woven

shirt production between 1967 and 1968 was as large as

the whole production of knitted. Furthermore knitted

shirt imports were about six times greater than

production and to bring them in would indicate greater rather

than less market disruption.

5.

Stewart then argued that Hong Kong's share of the

shirt market had fallen significantly and that Japan's

share was increasing; and also that the fall in

production was not substantial i.e. about 6% between

1967 and 1968. Jones replied that the share of the market

held by imports had now risen to about 48% compared with

only about 25% in 1966. Shirts were the major problem

for Canada and she would insist on it being settled. As

regards Hong Kong the 1966 and 1967 figures were pre-

restraint and there had been some cut back then.

Nevertheless the 60,000 dozen exports of polyester/

polynosic shirts this year would improve the position.

Stewart said that, nevertheless, imports from a number of

sources were being cut back this year. Jones pointed out

that the Hong Kong Government were aware of this and

would argue strongly that the colony's polyester/polynosic

shirts should be well accommodated in any new combined

level with polyester/cotton that might be agreed.

./4