CONFIDENTIAL
discussions to reduce to a minimum any common restrictions on Hong Kong and to
LOK AŞEZA
ecure a time limit on them or at least to get general agreement that the
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United Kingdom should not be asked to introduce restrictions until after a
further review of the continuing need for them at the end of our transitional
period. And we might urge that existing restrictions should be phased out and COME Com
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that new restrictions should not be introduced except in so far as they could the
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be shown to be in accordance with normal GATT rules.
19.
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uch a
TEXTILES
guessing 4.
20. The position on textiles is extremely complicated since botn the Six
and the United Kingdom are in the process of modifying their existing policies
on cotton textiles and because of the threat to Hong Kong trade in non-cotton
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textiles from protectionist legislation currently before the United States
Congress. At the present time all Member States of the EEC operate some
quantitative restrictions on cotton textiles from Hong Kong under the GATT Long-
ABC Acco.
Term Arrangement which runs until September 1973. These restrictions are
operated nationally and vary considerably in scope and intensity, with the
Germans being by far the most liberal. The Commission have just embarked on
negotiations with Hong Kong with a view to bringing broadly into line the coverage
of individual members' quotas under the Long Term Arrangement. Even when this
has been done it is likely that the Member States will in practice continue to
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control imports on a national basis and that the textiles imported from Hong
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Kong (and other restricted sources which include Japan, India, Pakistan, South
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Korea, Taiwan and the UAR) will not at any rate for some time to come enjoy
free circulation within the Community.
Cotton textiles imported into the EEC
from all sources other than countries associated with the Community have to pay
GAIS DE
the full CET. But under their UNCTAD preferences offer, the EEC propose to
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give duty-free entry to cotton textiles imported under LTA quotas from develop-
ing countries. Our present arrangements for cotton textiles are that quantitative
restrictions under the LTA are applied to all developing countries, including
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Hong Kong, though the size of our quotas is much larger than those granted by the
Six to the countries which they restrict. Cotton textiles from Commonwealth
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CONFIDENTIAL
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