ENG-1962 — Page 107

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INDUSTRY AND TRADE

competitive in the world. For this reason, and because a very high proportion of their products are exported, they have figured largely in the various discussions held during the last two years on international trade in cotton textiles, despite the comparatively small size of the spinning and weaving sections.

In January 1962 the Director of Commerce and Industry and the Director of the Hong Kong Government Office in London were members of the British delegation which attended a conference held in Geneva to consider the draft for a Long Term Arrange- ment covering international trade in cotton textiles. Three repre- sentatives of the cotton textile industry accompanied the Hong Kong delegates as advisers. The draft arrangement drawn up at the conference was directed to ensure the stability and orderly development of the cotton textile trade over the five-year period from 1st October 1962.

As with the Short Term Arrangement, on which it was based, the terms provided for the protection of the domestic textile in- dustries of importing countries which were threatened with dis- ruption. This protection was to be achieved by granting importing countries the right to call for restraint on exports from exporting countries at any time during the life of the Arrangement at the level obtaining in the first 12 of the 15 months preceding the month in which the request for restraint was made. Some provision for expansion of trade was, however, made by ensuring that, from the second year, an annual increase in imports of not less than five per cent above the level for the base year should be allowed if restraint remains in force' for longer than 12 months. A special provision requires that countries still maintaining import restric- tions contrary to the GATT should allow textile imports on a more liberal basis.

A further meeting of the Cotton Textile Committee of the GATT was held in Geneva in September and gave formal approval to the final draft. The Director of Commerce and Industry repre- sented the Colony on the British delegation, advised by two mem- bers of the Cotton Advisory Board. At the request of the Hong Kong Government, Her Majesty's Government in the United Kingdom formally accepted the Long Term Cotton Textile Arrangement on behalf of the Colony, and it came into force on 1st October.