TNAG-0632-FCO40-780-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 36

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a very fervourable resuit for the Community wheel. TEXTILES: RESULTS OF THE COMMUNITY'S BILATERAL NEGOTIATIONS

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The Commission completed their round of bilateral textile negotiations with the initialling of an agreement with Hong Kong at midnight on 2 December. The Commission will present a report to COREPER on 9 December. Ministers at the Council on 19/20 December will have to decide whether the results are satisfactory enough to enable the Community to agree to sign a renewed GATT Multi-Fibre Arrangement when the present instrument expires on 31 December.

2. Most Member States are likely to judge the results of the negotiations as satisfactory. The Community's agreed negotiating mandate states that if negotiations are not satisfactorily resolved, the Community will take unilateral measures to establish the necessary protection for the Community's textile industry. This is a situation which we in the FCO would clearly want to avoid because of its wider implications for the international trade field and for the Community's relations with developing countries. It is alee clear that insistence on unilateral measures would be a

fficult position for the UK to maintain in the face of opposition from most Member States within the Community. It is therefore very much in the FCO interests that other Whitehall Departments, particularly the Department of Industry, should decide that the negotiations have been satisfactory. Ministerial responsibility, in the first instance, is with Mr Dell.

3.

A key element in the package which will be presented to Communi

Community Ministers on 19/20 December will be the question of agreements with India, Pakisten, Egypt and Brazil. For these countries the Commission have identified "zones of agreement" anů are likely to suggest to Member States that agreement can be

reached with these countries at a price. The price will mean increases above the Community internal global import ceilings for the eight most sensitive products which were included in the Commission's negotiating mandate and by which UK Ministers set the

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