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271
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RECEIVED IN REGETRY No.51
-3 JUL 1039 #KKC/5U8/8
Weekly Survey of the Textile Scene
F. W. TATTERSALL LTD.
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WOOLWICH HOUSE' ·
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61 MOSLEY STREET
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MANCHESTER M2 3HU
061-236 8757
No. 1,430
TARIFF PLAN UNDER FIRE.
24th June, 1969.
While the industry is still waiting with considerable impatience for the Government to give some indication of its views on the suggested imposition of a tariff on foreign imports of cotton goods to replace the current quota system, rumblings of discontent have been heard about the whole project as outlined in the Textile Council's Report. A tariff "of the order of 15%" is now regarded in some quarters as completely inadequate as a protective barrier.
Even before Mr. Edmund Gartside, chairman of Shiloh Spinners, referred to the topic at the annual meeting of the company, fears had been expressed by individual traders who have, been busily working out the prospects during the past few weeks. Their conclusions led to the belief that an import duty of 15% would be a complete failure in deterring imports.
The President of the Board of Trade and his advisors now have before them figures which claim to show that a duty of at least 25% and even as much as 33 1/3rd % will be needed to afford protection for British manufacturers to stop and control unlimited imports. The existing quota arrangements only deal with goods imported for retention in the home market; re-exported products are not subject to regulation.
Substantial Differential.
The price differential between these two contrasting types of goods has always been substantial. Examples have been quoted to the Board of Trade showing a variation of around 25% between the quotation for Commonwealth cloth scheduled for home consumption in Britain and for re-export. The main reason is the active market in overseas countries for quotas which are bought and sold, the premium being added to the normal selling price. As a result, if the quota arrangements were to be abandoned the lower value gives a true indication of the price at which the Commonwealth exporter is able and willing to trade.
Mr. Gartside illustrated these points, referring to differencès of between 19% and 38% in the price of cloth imported into the United Kingdom for home retention and the much lower price of the same cloth imported for re-export. "This suggests," he said, "that the tariff recommended of 15% on grey cloth will be totally inadequate because it is the re-export price which is the true selling price on which the tariff will be levied."
Another point made by Mr. Gartside was that the trade did not fully appreciate that the suggested tariff on yarn was only 6%, a level which he described as "quite ludicrous." Reaffirming his conviction that the present quota system should be retained for an indefinite period, the only alternative, he said, was to introduce the tariff at a much higher level than that suggested by the Textile Council.
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