TNAG-0386-FCO40-432-Exports-of-non-cotton-textiles-from-Hong-Kong-to-the-EEC-1973 — Page 76

CONFIDENTIAL

) SUFFICIENT TO POSTPONE THE ADOPTION OF A COMMUNITY MANDATE FOR HEGOTIATIONS WITH HONG KONG UNTIL AT LEAST SUBSTANTIAL PROGRESS

HAS BEEN MADE IN SETTLING THE TEXTILE PROBLEM IN GENEVA,

AND ON THE PRINCIPLE OF SELECTIVE COVERAGE BY REGIONS THE NUMBER OF ITEMS, THE BASE DATE AND THE DATE OF COMMENCEMENT OF THE RESTRAINT MIGHT HAVE TO BE DIFFERENT FOR THE DENELUX THAN FOR

CERMANY.

WE

7. AS REGARDS THE QUESTION OF POSSIBLE COMMUNITY MEASURES,

ARE NOT ATTRACTED BY THE CONCEPT OF QUOTE COMMUNITY QUOTAS WITH MEMBERS STATES' SHARES HIGH ENOUGH TO BE NON-RESTRICTIVE UNQUOTE.

APART FROM THE DIFFICULTY OF DETERMINING WHERE THE HIGH MARKS SHOULD DE SET IN REGARD TO A NOTORIOUSLY VOLATILE TRADE, ESPECIALLY IN THE GARMENTS SECTOR, THERE IS THE PROBLEM OF PERSUADING THE LESS LIBERAL STATES THAT SHARES WHICH ARE EVEN PROPORTIONATELY

QUITE A LOT HIGHER THAN THE VERY LOW IMPORT LEVELS CURRENTLY OBTAINING WOULD STILL BE INADEQUATE, EVEN AS CONSULTATION? LEVELS AS YOU APPARENTLY ENVISAGE.

8. IN THE LIGHT OF THESE FACTORS WE SHOULD BE MOST GRATEFUL IF YOU WOULD CONSIDER AGAIN THE BENEFITS WHICH WOULD BE LIKELY TO ACCRUE

IF WE WERE TO INSTITUTE A UNILATERAL RESTRAINT TO THE BENELUX ON

THE LINES INDICATED ADOVE AND THE DANGERS OF EARLY AGREEMENT ON A

RESTRICTIVE COMMUNITY-WIDE MANDATE IF WE DID NOT. AS REGARDS THE

LATTER IT WOULD NOW APPEAR TO US T AJMHQLPPZHHTHZHATTIUDE OF

FRANCE ON THE ONE SIDE AND THE INSISTENCE OF YOURSELVES, THE

GERMANS AND THE DANES ON THE OTHER ON SELECTIVE COVERAGE, PROVEN DAMAGE AND REGIONAL APPLICATION, ANY COMMUNITY MANDATE COULD TAKE A LONG TIME TO PUT TOGETHER WHATEVER OUR ACTION MAY BE ON BENELUX,

MACLEHOSE

EUROPEAN ECONOMIC DISTRIBUTION

TRD HKIOD

EID

ADDITIONAL DISTRIBUTION

FRAME

COPIES TO:

MR HOPE CTD DTI

HONG KONG GOVT OFFICE LONDON

-3- CONFIDENTHAL