TNAG-0387-FCO40-433-Exports-of-non-cotton-textiles-from-Hong-Kong-to-the-EEC-1973 — Page 16

CONFIDENTIAL

POLYESTER/COTTON TEXTILES

Proposed restraints on imports from certain low-cost sources

Imports of polyester/cotton textiles from certain low-cost sources, particularly Thailand, and Colombia, are expected to rise rapidly to levels similar to those from Far Eastern countries whose exports to the UK are restrained. Action is now proposed to limit imports from these two additional sources and to establish guidelines for similar action in respect of other sources if it becomes necessary.

2. Last July, Ministers agreed to voluntary restraint arrangements for imports of polyester/cottons from Hong Kong and South Korea, with corresponding measures against Taiwan. Restrictions were needed because the growing volume of imports was having serious effects on the UK market, on employment opportunities and on the UK industry's ability to undertake the investment necessary to become competitive in Europe and generally. We were primarily concerned with imports fron Hong Kong, but also needed to act against South Korea and Taivan, which were well placed rapidly to build up their trade, were covered by US restraints, and could not be more favourably treated than Hong Kong Japan already restricted her exports to the UK. There was then no need for action against other developing countries which did not produce or were considered unlikely to send us appreciable quantities of polyester/cottons.

Prospective imports

3. In March this year, with the active approval of UK industry, we introduced an import licensing system designed to keep a close watch on polyester/cotton import trends from all other developing countries whose cotton textile exports to the UK are restrained. Since then, licence applications have been received with evidence of firm orders for 0.7 million sq yàs of polyester/cotton cloth and made-ups from Thailand, and 2.8 million sq yàs from Colombia, Licence applications for over one million square yards from other

individual countries have been as follows:

Spain

Macco

1.6n oq yás

1.5m

11

1:

Brasil

160

1t