TNAG-0173-FCO40-209-United-Kingdom-Productivity-and-Efficiency-Study-effect-on-H-1969 — Page 135

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PROTECTION THAT WAS BOTH STABLE AND PREDICTABLE, SO ENABLING THE

INDUSTRY TO PLAN AHEAD WITH CONFIDENCE. QUOTAS, ON THE OTHER HAND WERE LIKELY TO PROVE EVEN LESS EFFECTIVE IN THE FUTURE THAN IN THE PAST, AND WOULD NOT GIVE THE INDUSTRY THE INCENTIVE TO UNDERTAKE THE

INVESTMENT NEEDED TO MAKE IT MORE COMPETITIVE.

6..IMPORTS OF COTTON TEXTILES INTO BRITAIN, THE GREATER PART OF WHICH ENTER DUTY-FREE, HAVE NOW REACHED 53% OF TOTAL DOMESTIC CONSUMPTION. THIS IS A FAR HIGHER PROPORTION THAN IN ANY OTHER

MAJORED DEVELOPED COUNTRY. IN THESE CIRCUMSTANCES WE HAVE THE ALTERNATIVES OF RE-NEGOTIATING THE PRESENT UNSATISFACTORY QUOTA ARRANGEMENTS, OR ADOPTING A TARIFF WHICH WOULD BE BROADLY IN LINE WITH THOSE OF OTHER DEVELOPED COUNTRIES, THE GOVERNMENT HAVE

DECIDED THAT THE RIGHT COURSE IS TO INTRODUCE FROM 1ST JANUARY, 1972

A TARIFF ON IMPORTS FROM THE COMMONWEALTH PREFERENCE AREA ON THE

UNES PROPOSED BY THE TEXTILE COUNCIL. FROM THAT DATE THE EXISTING GENERAL QUOTA SYSTEM WOULD BE TERMINATED: AND THE GOVERNMENT WOULD

CONSIDER THE USE OF QUOTAS ONLY ON PARTICULAR PRODUCTS UNDER THE

ONG TERM COTTON ARRANGEMENT OF THE GATT, AND ONLY IF TOTAL IMPORTS OF COTTON TEXTILES ROSE SIGNIFICANTLY ABOVE THE PRESENT LEVEL AND

AUSED DISRUPTION TO THE MARKET IN THESE PRODUCTS. THESE DECISIONS WOULD, OF COURSE, BE SUBJECT TO ANY MODIFICATIONS THAT MIGHT BE. EQUIRED IF WE JOINED THE E,E.C.

7..IN REACHING THIS DECISION I HAVE TAKEN FULL ACCOUNT OF THE FACT

HAT A NUMBER OF COUNTRIES IN THE COMMONWEALTH PREFERENCE AREA HAVE RIGHTS TO DUTY-FREE ENTRY INTO THE U.K. MARKET: AND I SHALL NOW

INITIATE DISCUSSIONS WITH THE GOVERNMENTS CONCERNED WITH A VIEW TO

SECURING THEIR ACCEPTANCE OF OUR DECISION. I AM EQUALLY CONSCIOUS, ON THE OTHER HAND, THAT COTTON TEXTILES HAVE LONG BEEN TREATED NTERNATIONALLY AS A SPECIAL CASE: AND I MUST MAKE IT CLEAR THAT THIS

DECISION WILL NOT CREATE A PRECEDENT FOR FURTHER DEPARTURES FROM OUR

TRADITIONAL POLICY IN REGARD TO COMMONWEALTH GOODS IN ADVANCE OF

ANY GENERAL CHANGE OF SYSTEM WHICH MAY BE REQUIRED BY OUR ENTRY INTO

THE E.E.C.

18.

THE

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