TNAG-0250-FCO40-286-Discussions-on-EEC-negotiations-between-officials-of-Hong-Ko-1970 — Page 113

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beginning of 1972, Hong Kong, Taiwan and South Korea would flood

this market at unprofitable prices if necessary on a consignment basis to build up performance against the possible re-introduction of quotas (whether or not Britain joined the EEC). Hong Kong representatives are therefore likely to argue that, bearing all these factors in mind, it would be in every- one's interest to postpone the introduction of the tariff, implementing it only if and when it became clear that Britain would not join the Common Market, at any rate at this attempt.

70 We cannot accept this suggestion. One of the main purposes

of the tariff decision is to put pressure on the British textile

industry to take steps, within a specific time, to improve in

its efficiency.

Lancashire was told 15 months ago that the

changeover from quotas to tariffs would take place at the end of 1971. The present Government have re-examined the policy, taking into account all the relevant considerations such as the

possible enlargement of the Community, and have told the industry

that the decision and the date for its implementation still stand. We are not prepared to re-introduce the element of

uncertainty which has overhung our producers for so long.

EEC Restrictions on Cotton Textile Imports

8. The EEC restricts imports of cotton cloth and made-ups (but not yarn) from Hong Kong, India, Pakistan, Taiwan, South

Korea and the UAR. The Commission has now taken over

responsibility for the negotiation of these quotas, but within

the overall EEC quota is a breakdown into quotas for individual

EBC countries. Free circulation between member countries of the

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