TNAG-0530-FCO40-625-Trade-union-relations-in-Hong-Kong-industry-1975 — Page 39

CONFILENTIAL

most UK restraints on imports of textiles.

Negotiations with Hong Kong were

starting on Monday. These would extend the UK restraints to some knitted products. Negotiations were taking place or pending with most of the low cost textile exporting countries. As far as paragraph 15 of the TUC memorandura was concerned, the main difference between the United States and EEC arrangements to deal with low cost textile imports was that the United States provided for a more comprehensive coverage of items concerned, whereas the EC arrangements

were more restrictive. The EBC tended to focus on areas of particular disruption and then to take effective measures while leaving their hands free to negotiate

further if other areas came under pressure. The United States covered a much larger area but provided for rates of growth in imports of these items which tied its hands for the future. Mr Gibson commented that the United States had already negotiated agreements with Hong Kong, Taiwan and South Korea whereas EEC had not, while imports from these areas were increasing and so endangering employment of British textile workers. Hr Ridley said that he did not know of any acceleration of such imports, but if this was the case, though the level of imports may have been higher than last year up to now, it would necessarily fall off as ceilings were approached, once negotiations for an agreement were com→ pleted with the country concerned.

C.

Other International Action

i. Mr MacGougan said there was a feeling in the textile industry that the industry was felt by the Government to be expendable. Er Lever said that this was not so. From the Prime Minister dom, the Government

wished to protect the industry as far as possible within the limits of their Treaty obligations. The Government were not prepared to accept the sudden ruin of the textile industry, and, while preserving reasonable

freedom of trade, would try to ensure that any changes in the pattern

of world trade should not have an immediate and disastrous effect on any sector of the UK industry. Where the TUC (or anyone else) could provide

evidence of dumping, the Government would be active to take the necessary

steps for introducing import controls under the GATT. As far as state- trading countries were concerned, the best course would probably be to

try to obtain a voluntary agreement to prevent subsidised imports.

However, the fact that lac's were exporting low-cost textiles because

of cheap labour and bad working conditions was not a good argument for

the UK to take action against them, unless they were actually dumping

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CONFIDENTIAL