TNAG-0165-FCO40-201-Export-of-textiles-to-Norway-and-Sweden-1969 — Page 41

0003230

G.F. 323

CONFIDENTIAL

10 -

production was entirely attributable to knitted synthetic shirts of which Yugoslavia had a significant share of the import market. Market disruption was therefore attributable to Yugoslavia.

40.

Baron de Geer admitted that imports of knitted synthetic fibre shirts from Yugoslavia were large, but argued that imports of woven synthetic fibre shirts from Hong Kong had also increased considerably. It was imports from those two sources that created problems for the domestic industry. He said that it would be logical to request Hong Kong to restrain woven synthetic fibre shirts and Yugoslavia, knitted synthetic fibre shirts.

41.

Mr. Jordan reminded Baron de Geer that in their Memorandum the Swedish Government had only requested prolongation of the existing control arrangements; no reference had been made to the extension of the scope of controls or to restraint on new items. Baron de Geer replied that the request for transferring E/A items to quota was implicit in the Memorandum. He added that he was authorised to establish a combined quota for Hong Kong's woven cotton and polyester/

cotton shirts.

42. Mr. Jordan stated that there were doctrinal difficulties in that offer as Hong Kong could not accede to a combined restraint arrangement for garments of cotton and synthetic textile materials. Furthermore, cotton and polyester/cotton shirts were not completely interchangeable. Moreover, cotton shirts still had a larger share of market, and the switch to synthetic fibre shirts would only come gradually. This could be illustrated by the supply figures of cotton shirts, which had risen considerably since 1965. He added that despite considerable increases in imports, Swedish manufacturers had still been able to increase production of polyester/cotton shirts. He admitted that imports from Hong Kong during the latter half of 1968 had been considerable, but he pointed out that during the discussions in Geneva in February 1969, he had already given an estimate of 646 of likely.. total imports of polyester/cotton shirts from Hong Kong for 1968. In the event, the actual imports were only 622. As regards the export of cotton woven shirts from Hong Kong, the quantity licensed in ten months of the restraint period amounted to only 60% of the restraint limit. Thus apart from the situation in knitted synthetic fibre shirts, in which Hong Kong had very little interest, the present situation could not be described as alarming.

Woven cotton night garments

:

43.

Baron de Geer commented that there was no point in restricting woven cotton night garments any longer. He suggested removing the item from quota to an E/A system. Mr. Jordan noted the suggestion..

Cotton coats. not knitted or orochted, men's and boys' wear

44.

After Mr. Bernunger had gone through the figures in Cotton Garments Table 7, he asked how Hong Kong defined and classified coats of impregnated fabric. Mr. Jordan replied that the cotton fabric in this regard had been steeped with rubberised or waterproof materials, the latter forming a layer not easily separable from the fabric. Mr. Ho added that those coats fell under four different Hong Kong trade classification numbers: namely, 841.111 - coats; 841.123 raincoats; 841.124 car coats; and 841.125 outer garments of rubberised fabric.

45.

Mr. Jordan then said that during the first ten months of the restraint period, only 16% of the level for coats of impregnated fabric was licensed for shipment to Sweden. He argued that restraint on that item was unnecessary. Baron de Geer noted that imports from

/Hong Kong

CONFIDENTIAL