TNAG-0391-FCO40-437-Restriction-on-cotton-textile-exports-from-Hong-Kong-to-the--1973 — Page 50

To all Members' of the Textile Working Party

COTTON YARN

(43)

MTCR/ES/

Attached are a summary of the submission as we intend to revise it in the light of comments made at yesterday's meeting, and a note on the figures which we would propose as additional yaru quotas during the three years' transition and a schedule. It is impossible to quantify the present UK cotton yarn quotas as a single figure, because of the complexity of our quota systen, but we think that the two figures with which our proposed additional quotas should be compared are:

a.

b.

in the UK, retained yarn imports from restricted sources, ie 9,000 metric tonnes in 1972, of which 1,200 from Mediterranean associates of EEC;

}

in Brussels, the notional present annual quota figure derived from the Regulation on UK imports of cotton gern April-December 1973, ie 17,000 metric tonnes.

This disparity is unfortunate, in that the highest figures which we can recommend, in tonnes, for the additional quotas, while still keeping the maximum potential imports at a lower level then that predicted by the BTHA under liberalisation from 1 January 1974, are greater when expressed as a percentage of a., when we would like to represent the increases as small, than they are as a percentage of b., when we would like them to be as large es possible. But we can use a. in exposition and debate in Brussols, though b. will have to be the base figure in the new Regulation if Community documents are to be consistent.

In presenting the case to industry we can emphasise that some underutilisation of the additional quotas is inevitable, because of their allocation to individual countries, come of whom will not be interested in increasing yarn exports to the UK.

Since drafting the notes and schedule on modalities we have realised that the Common Liberalisation List for State Trading countries does not include cotton yarn, and revisions must therefore be "ade. But in view of the timetable discussed yesterday we are distributing the papers now for comments on the substance.

RP Hope

CT16

2 November 1973