TNAG-0156-FCO40-192-Export-of-textiles-to-Australia-1989 — Page 55

G.F. 323

CONFIDENTIAL

Ref. CR. EIC 891/5/11

14 FEB 1262

MEMORANDUM FOR THE COTTON ADVISORY BOARD

Export of Cotton Textiles to Australia

Request for Restraint on Exports of Drills. Denims. Dungarees and Jeans

1/3064625 c.c.3/1/381 11

CAB/451

Encl.1

Introduction

The Australian Government handed over to the British High Commission in Canberra on 31st January, 1968, a request for export restraint by Hong Kong on cotton drills, denims, dungarees and jeans. This request, the full text of which is at Enclosure 1, purported to be made under Article 3 of the Cotton Textiles (formerly Long Term) Arrangement.

2.

In summary,

the Australian note:

(a) referred to an increase in imports from Hong Kong

between the 4th and 5th Long Term Years of the order of 25% (1,067,200 sq. yds. to 1,337,700 sq. yds.); (b) claimed that such imports had been offered in Australia

at A$0.50 a sq. yd. as compared with A$0.743 for comparable Australian products;

(c) alleged that as a result orders had been diverted away

from Australian weavers and the likelihood of further losses in the near future was threatening serious damage to the Australian industry;

(d) suggested a restraint limit of 1,500,000 sq. yds. for

the year commencing 31st January, 1968;

(e) claimed that this proposed restraint limit was, based

on Australian import figures, higher than that which would result from an application of the C.T.A. 'roll back' formula.

Hong Kong's Response

Encl.2

3.

At Enclosure 2 is the text of a note that the British High Commission has been asked to hand over on behalf of the Hong Kong Government.

4.

In summary it:

(a) rejects the restraint request as not complying with Article 3 of the Cotton Textiles Arrangement on the grounds that it was not a request for consultation and it was in any case inadequately supported with evidence of threatened market disruption as prescribed in the Arrangement;

(b) expresses the Hong Kong Government's willingness to

consult in response to a properly documented request under Article 3;

(c) requests clarification of the precise constructions

which were the subject of the Australian note;

(d) asks whether the G.A.T.T. Cotton Textiles Committee

has been informed of the Australian request, as required by the C.T.A.

/Department's

CONFIDENTIAL