TNAG-0301-FCO40-337-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 133

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supplier)

EEC makes the problem of improving the efficiency of the UK industry one

of greater immediacy and strengthens the need for the adoption of policies

directed towards this end.

7. In (e) and (f) you consider the possibility that the UK may be forced

to reimpose quota restrictions after 1st January 1972 by a sudden disruptive

beceased surge of imports of cotton textiles. The UK has not,-of-course,-relinquished

its right to take action in the case of disruption in accordance with the

provisions of the Long Term Arrangement. The President's statement of

22 July 1969, however, laid down that the United Kingdom would only consider

reimposing quotas after 1 January 1972 on particular products if there was

a significant rise in total imports of cotton textiles as well as disruption

of the market in these particular products. These represent stricter con-

ditions than are laid down in Article III of the Long Term Arrangement and

mean that the United Kingdom will be prepared to tolerate increased import

penetration in one sector of the market in cotton textiles detrimental to

the interests of the UK industry if this is offset by relief for the UK

industry in other sectors. The implications of this policy were set out in

greater detail in my Saving Despatch No 223 of 22 June 1970 to you. During

1 Thmay the Miam kong refrere facing lord the meeting we were pressed-to-give further assurances about the basis on

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which quota restrictions might be reimposed in the face of disruption caused

by determined attempts by our suppliers to improve their market performance.

It is not possible for us to lay down in advance our reaction to every

hypothetical situation that might arise, but since it is our intention only

to impose quotas on sectors in which there is disruption, it fallows that

the pattern of any reimposed quotas would be unlikely to be the same

present system. We are expecting some changes in the pattern of our imports

from 1972 on and we cannot therefore guarantee that any subsequent reimpositio

of quotas will automatically preserve the share of our market currently

enjoyed by each of our suppliers under the present restrictions. At the

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