TNAG-0388-FCO40-434-Exports-of-knitwear-from-Hong-Kong-to-the-UK-1973 — Page 42

The area of the industry where we feel there is the

nearest to a case for restraint is in knitted cardigans, sweaters

etc. It is not particularly impressive (see annex)

In

quantity, U.K. manufacturers had in 1971 almost 80% of the

domestic market, and in value almost 85% (their exports were

larger than total imports).

7

disneyes.

5. We can see little evidence of the alleged description of the

U.K. industry. The reported loss or jobs does not seem out of

line with the claimed increases in productivity, and in fact

is proportionately less than that for manufacturing industry

as a whole. There is some unused capacity, but the limiting

factor appears to be more shortage of labour than anything else.

The main manufacturers of outer garments appear to be operating

profitably.

6. Our situation as members of the E.E.C. is obviously a

highly relevant factor. Broadly the effect of current

national measures among the Six is that France and Italy have

almost total protection, whereas Germany and the Netherlands

are close to the U.K. in terms of imports of knitted goods

per capita. The Community is tending to move towards greater

protection against low cost textile imports from the Far East,

and there is little reason to doubt (whatever the formal rules

provide) that any steps we wished to take would be welcomed.

But as indicated in para. 2 above we think that it important

for our longer term objectives within the E.E.C. that we

should insist on selectivity, and action only where there is

clear justification.

3.