TNAG-0301-FCO40-337-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 142

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months.

to three months to ship goods to this country. There is already an incentive

for Commonwealth suppliers to ship their entire 1971, quota in time to avoid the

new tariff, say by some time in November, of this year. This means that twelve

months quota may well be shipped in ten months and arrive in this country in ten

We are not objecting to this which is quite permissible under the

present arrangements, and it is anyway now too late to attempt to scale down the

quotas accordingly. It does mean, however, that our import figures for, 1971.

are likely to be swollen anyway for this reason. If our restricted Commonwealth

suppliers are then free to continue shipping cotton textiles from about November

1971 onwards although they have filled their, quotas, and if non-Commonwealth

suppliers are also free to exceed their ceilings during this period, then there

will be no respite, from the higher rate of imports in the early months of 1972,

but on the contrary the rate would probably continue to rise. Some of our

suppliers have already warned us to expect an initial surge of imports with the

removal of quotas and this would not only be positively encouraged, but brought,

forward in time if we in effect relax the restrictions on our Asian suppliers

around November of this year. The extent of this 'peaking of trade will of

course to some extent be restrained by commercial factors. But Lancashire would

have a legitimate complaint if transitional, arrangements were made which allowed

up to perhaps eighteen months' supplies to arrive in little over twelve. This

could have the serious consequence, not least for overseas, suppliers, of seeming

to lend colour to the view (which the Lancashire backwoodsmen already holậ) that,

tariffs will not, work, and of provoking early pressure for the restoration of

quotas as well.

'

•

5 For these, reasons, CT Division have concluded, that the quota restrictions

must be enforced on all shipments up to 31 December 1971, and I return below to

the implications that this will have for import licensing in the early months of

1972. We have, however, been considering another possible way of easing the

transition for our restricted Commonwealth suppliers, namely exemption from the

new tariff for goods shipped under quota in 1971 but not arriving in the UK