TNAG-0628-FCO40-776-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 126

C.S. 166

CONFIDENTIAL ## 機密

P/A

1412

XCCI(77)3 Copy No..

2.8

For information

MEMORANDUM FOR EXECUTIVE COUNCIL

FUTURE OF THE ARRANGEMENT REGARDING INTERNATIONAL TRADE IN TEXTILES

RECOYED #

4

REGISTRY No, st

11 JUL1977

HKK 121

Introduction

The Arrangement Regarding International Trade in Textiles, commonly known as the Multi-Fibre Arrangement (MFA), which came into force on 1st January 1974, expires on 31st December 1977. The purpose of this memorandum is to advise Honourable Members of recent developments regarding its future.

2

At present over 60 per cent by value of Hong Kong's exports of textiles and clothing (or about 30 per cent of total domestic exports) are subject to restraint under bilateral agreements concluded under the MFA with six trading partners the USA, the EEC, Sweden, Norway, Austria and Finland. The agreement with the US expires on 30th September 1977 and the others (with the exception of the agreement with Finland which was recently extended to 31st July 1978) expire at the end of 1977.

Multilateral Activity

3

The GATT Textiles Committee which is composed of all (about 50) participating countries held a meeting in November/ December 1976 to conduct a major review of the operation of the MFA and to consider its future. The USA favoured an agreement to extend the MFA without change and was supported by most other participants, including Hong Kong and nearly all the developing countries. The EEC indicated, however, that it wanted the MFA modified; but although it expressed dissatisfaction with certain of its provisions and indicated an intention to seek changes to make it more restrictive, it was unable, because the Member States of the EEC had not yet reached agreement amongst themselves, to state what modifications it wanted. Never- theless, this was sufficient to block any agreement on the future of the MFA at that time.

4

Another meeting of the Committee was held in March 1977 but again no progress could be made because the EEC had still not agreed on its negotiating position. Another meeting scheduled for April had to be postponed for the same reason.

CONFIDENTIAL #

機密