TNAG-0631-FCO40-779-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 41

Re-Negotiation of the GATT Multifibre Arrangement (MFA) :

Objectives in the bilateral negotiations

The EC Commission is currently trying to translate the Community's overall objectives in the MFA into restraint agreements with all the significant low- cost supplying countries. The Community has set itself the objective of completing these bilateral negotiations by 30 November in time to take a decision whether or not to renew the MFA in December.

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The

a

In all the Commission will be negotiating with over 25 suppliers. lit includes all those covered by existing HPA agreements (except Japan); number of other MFA supliers which were not significant enough to need bilateral agreements under the existing MFA; and finally a group of non-A suppliers which will be offered similar terms to the MFA signatories. A full list of the suppliers concerned is at Annex I.

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Taken as a whole the Community's objectives in these bilateral negotiations

are to secure:

(i) quota coverage which is much more comprehensive than in

existing MFA restraint agreements. The Commission will seek immediate restraints on all significant suppliers of any product which is considered at all sensitive either in the EEC as a whole or in a particular Member State. In particular for the eight most sensitive products where import penetration in the EC is highest, the intention is to restrain all low-cost suppliers within an overall ceiling. To deal with the problem of cumulative dis- ruption which has arisen under the present MFA when new suppliers appeared in addition to those already under restraint the EEC will also insist on a strict . consultation provision so that immediate action could

(ii)

M

TAYYS

be taken to introduce new restraints on particular products from individual suppliers which are not subject to immediate restraint under the bilaterals.

lower quota growth rates. The existing MFA stipulates a minimum annual growth raic of 6%. For many products the EEC is now seeking an overall growth rate for low-cost suppliers well below this level, in some cases 2% or less. And major suppliers of particular products will often receive growth rates of 0 - 0.5%.