TNAG-0302-FCO40-338-Effects-of-tariffs-on-imports-of-cotton-textiles-to-UK-from--1971 — Page 81

CONFIDENTIAL

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placing

we would avoid a breach of our international undertakings

because we would not act except where and when the market

showed we had a case for doing so (and we should in the

meantime have warned our trading partners of our intention

and of the probability that there would be no time to go

through the consultation procedures of the Long Term Arrangement). By this means we might hope to deter imports from rising. But if the deterrent did not work (and it

might casily prompt traders to take their chance while they could), we could contain imports to an acceptable level for the whole of 1972 only by a cut-back, perhaps severe, for the remainder of the year, which could dislocate supplies (including those to many British textile mills). And

traders would have had to suffer the worst kind of stop-go

interference.

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9 Both the remuing options would contuin importe from

the beginning of 1972 and would involve inmediate breach of

international obligations and understandings. The third

option would be to impose a global quota on all currently

restricted supplier countries at a level equivolont to the

total of the present restrictions. It would allow importers to buy where they liked, within broad category ceilings.

would benefit the most competitive suppliers and continue to

discourage the least competitive forms of production in

Lancashire. Compared with the present quotas, it would

favour countries like Pakistan, Singapore and Halaysia, and

also Korea and Taiwan, who have been held down by the

It

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