TNAG-0245-FCO40-281-Exports-of-textiles-from-Hong-Kong-to-Sweden-1970 — Page 16

0003230

G.F. 323

CONFIDENTIAL

10 -

Second Plenary Session Thursday, 28 May 1970 11 a.m.

30.

Baron de Geer stated that as a result of the arguments put forward by Hong Kong at the previous session the Swedish Government was now prepared to drop the following from restraint to export authorisation control

Cotton

(a) knitted night garments;

(b) knitted undergarments (except underpants for m. & b.);

(c) woven slacks;

(a) towels.

Non-Cotton

(e) woven slacks;

(f) knitted undergarments (except underpants for m. & b. and

w. & g.).

He stood firm on the other items and avoided referring to joint levels. He still maintained that there could be no growth on sweaters. He said that he fully appreciated Hong Kong's presentational difficulties over certain restraints and stated that the Swedish Government was prepared to help Hong Kong out by the imposition of import restrictions. He reiterated his conviction

of majority support in the G.A.T.T., particularly among developing countries for any such Swedish action against Hong Kong.

In

31.

Mr. Ho replied that he had no instructions to deal with this offer. He was in Stockholm to explore possibilities of accommodating the Swedish Government by restraining exports. such a situation Hong Kong could assist the Swedish industry by

(a)

restraining exports;

(b) retaining commercial initiative and bargaining power over

prices; and

(c) trading up.

Mr. Ho added that if restraints were controlled at the importing end, Swedish importers would hold the commercial advantage and would be calling the tune. This would tend to bring prices down. The object of these discussions, Mr. Ho pointed out, was to avoid disruptive effects in individual markets and on individual lines of production in both the importing and the exporting countries.

32.

Mr. McEnery stated that the U.K. experience has been that one of the effects of import restrictions was to increase disruption. Quantitative import restrictions tended to lower prices and make the market situation worse.

33.

At this point, Mr. Họ requested a short adjournment to consider the latest Swedish counter proposals on items to be covered in any future arrangement.

/34.

CONFIDENTIAL