TNAG-0632-FCO40-780-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 41

GPS 600

IMMEDIATE

CYPHER CAT A

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4KK

121

16.6.11.

391

No

FM UKMIS GENEVA 361238Z

[FRAME EXTERNAL]

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TO IMMEDIATE FCO TELNO 652 OF 06 DECEMBER

INFO UKREP BRUSSELS, CAIRO

TEXTILES: 113 COMMITTEE, 6 DECEMBER EGYPT

SUMMARY

1. THE 113 COMMITTEE MET TO DISCUSS AN EGYPTIAN REQUEST FOR THE

LIFTING OF THE EEC RESTRAINT ON COTTON YARN FOR THE REMAINDER

OF 1977. SOME MEMBER STATES COULD ACCEPT SUCH A QUOTE GESTURE

UNQUOTE BUT WE, THE IRISH AND THE DUTCH SAID WE COULD NOT.

IN THE ABSENCE OF A CONSENSUS, THE COMMISSION WERE LEFT TO TAKE THEIR RESPONSIBILITIES WITH EGYPT, WITH A WARNING TO BE PRUDENT.

DISCUSSION

2. THE COMMISSION (INITIALLY HOFFMANN AND LATER KLARIC) REPORTED

THAT EGYPT HAD COMPLAINED TO THE TS3 ABOUT THE EEC QUOTA ON COTTON YARN (INTRODUCED IN THE SECOND PACKAGE OF EEC MEASURES IN THE SUMMER). THERE HAD BEEN OTHER COMPLAINTS TO THE TSB ABOUT THE

TWO PACKAGES BUT THESE WERE IN ABEYANCE PENDING THE OUTCOME

OF BILATERAL NEGOTIATIONS. ONLY EGYPT WAS INSISTING ON FULL

DISCUSSION BY THE TSB. HAMZA HAD HOWEVER THE RESTRICTION FOR THE

REMAINDER OF 1977. THE COMMISSION WANTED TO MAKE THIS GESTURE

WHICH THEY SAID WAS REALLY SYMBOLIC AND WITHOUT PREJUDICE

TO THE OUTCOME OF BILATERAL NEGOTIATIONS WITH EGYPT.

3. IN DISCUSSION, SOME MEMBER STATES (FRANCE, GERMANY, ITALY)

WERE DISPOSED TO SUPPORT SUCH A GESTURE WHICH THEY THOUGHT

MIGHT HELP THE CONCLUSION OF A BILATERAL AGREEMENT WITH EGYPT.

NEUNDORFER WAS HOWEVER CONCERNED ABOUT THE LEGAL ASPECTS: THE

PRESENT QUOTA WAS THE RESULT OF A COUNCIL REGULATION AND THERE

WAS NOT ENOUGH TIME TO AMEND THIS BEFORE THE END OF THE YEAR.

THE UK SAID THEY COULD NOT AGREE TO THE LIFTING OF THIS RESTRAINT,

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lESPECIALLY