CONFIDENTIAL
THERE ARE PROVISIONS TO ESTABLISH A MINIMUM LEVEL BELOW
WHICH THE TRADE CANNOT BE RESTRICTED: TO PROVIDE FOR INCREASES
IN THAT LEVEL IN FUTURE YEARS: AND TO PROVIDE FLEXIBILITY WHEN
MORE THAN ONE PRODUCT IS RESTRICTED.
THERE IS ALSO A PROVISION UNDER WHICH EXPORTING AND IMPORTING
COUNTRIES CAN MAKE BILATERAL AGREEMENTS ON MUTUALLY ACCEPTABLE
TERMS TO ELIMINATE ''REAL RISKS'' OF MARKET DISRUPTION. THIS MEANS THAT SUCH AGREEMENTS CAN BE MADE WELL BEFORE MARKET DISRUPTIONHAS OCCURRED OR IS ACTUALLY THREATENED.
OUR AGREEMENTS WITH THE UNITED STATES AND WITH THE EUROPEAN ECONOMIC COMMUNITY ARE OF THIS TYPE.
FROM WHAT I HAVE SAID I HOPE IT IS CLEAR THAT, AS MR TIEN SAID, THE MFA IS ALREADY A RESTRICTIVE INSTRUMENT.
NEVERTHELESS, FROM REPORTS PUBLISHED IN BRUSSELS AND FROM OTHER SOURCES, IT APPEARS THAT SOME MEMBERS OF THE EEC WANT TO MAKE IT MORE RESTRICTIVE, ALTHOUGH AS ONE AT LEAST OF THEM HAS
ACKNOWLEDGED, THANKS TO THE AGREEMENTS THAT THE EEC HAS MADE UNDER THE MFA, IN TERMS OF COVERAGE, THERE IS NO DOUBT THAT
THE TEXTILE INDUSTRY ENJOYS A GREATER DEGREE OF PROTECTION THAN
IN THE PAST.
THEY HAVE CLAIMED THAT THE MFA PROVIDED INADEQUATE PROTECTION FOR DOMESTIC INDUSTRY DUPING A RECESSION AND THAT THIS POLICY IS
TO SEEK VARIOUS AMENDMENTS TO IT.
WHATEVER VIEW ONE TAKES OF THE POSITION OF SOME EUROPEAN
TEXTILE INDUSTRIES, IT SEEMS TO US THAT THESE DIFFICULTIES
CANNOT BE BLAMED ON THE MFA ITELY BECAUSE, ! THOUGH, THE MFA CAME INTO FORCE ON JANUARY 1974, THE EEC DID NOT START
NEGOTIATING DILATERAL AGREEMENTS UNTIL 1975 WE CONCLUDED
OUR AGREEMENT IN JULY 1975 - AND SOME OF THEM WEREN'T COMPLETED
UNTIL 1976. THIS MEANS THAT 1976 WAS THE FIRST FULL YEAR IN
WHICH ANY OF THESE AGREEMENTS WAS OPERATIVE.
-2- CONFIDENTIAL
/AMONG
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