TNAG-0391-FCO40-437-Restriction-on-cotton-textile-exports-from-Hong-Kong-to-the--1973 — Page 58

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TELEGRAPHIC ADDRESS:--

"CANDIHONG” HONG KONG

OUR

REF.:

BY AIRMAIL

CR/EIC 294/5/11/8 II

YOUR

REF.:

(Dear Robin),

COMMERCE & INDUSTRY DEPARTMENT,

FIRE BRIGADE BUILDING,

MONG KONG.

14 November

1973

Carryover of unused 1973 quotas into 1974

Many thanks for your letter of 6 November 1973: I am sorry the Bangkok trip didn't go quite as planned!

2.

Although our action of 9 August 1973 in extending our arrangements was unilateral (and could not be otherwise as we cannot 'negotiate' with you as a Member State of the EEC), I think it was accepted between us that there was an urgent need for some measure which would provide sufficient certainty to the trade without at the same time prejudging, either on your

Our part or ours, the future multilateral textile arrangement. idea of extending the restraint period from 12 months to 18 months was indeed welcomed by Liz Lowne as an "admirable solution" in her letter of 21 August 1973, though she did of course express a preference for a separate 6-month restraint period. However Bill Dorward in his reply of 4 September set out in some detail

You mentioned the subject briefly the reasons for our action.

when we met on 5 October (but Philip kidley not at all to Bill Dorward when they met on 2 October), but since we had heard nothing further from you, we had assumed that you had in the end accepted Bill's explanation in his letter of 4 September. be have of course made the necessary quota allocations and commercial dispositions have been made accordingly.

3.

In our view the longer the restraint period is, the less concentrated the impact of imports will be, because trade (within the restraint limitations) and domestic production will better be

It is this which gives able to follow the true pattern of demand. stability to the trade. Quota periods of less than 12 months duration are detrimental to this stability because they impose artificial deadlines which are meaningless in terms of actual trading requirements. It is for this reason that we are doctrinally opposed to provisions which dictate a spread of shipments through- out the year and there are none in our past or present arrangements with you.

Mr. R.P. Hope,

Department of Trade & Industry,

Millbank Tower, Millbank,

London ..1,

England.

14.