Foreign Relations of the United States, 1964–1968, Volume IX, International Development and Economic Defense Policy; Commodities

327. Telegram From the Mission in Geneva to the Department of State¹

Geneva, September 30, 1966, 1905Z.

1184. Ref: Geneva 1165.²

1. Fourth session September 29 continued discussions under Article 8(D) of LTA.

2. Hong Kong prepared support LTA extension in present form for a period of three years only, if there are specific and concrete assurances (a) relaxation of restrictions to maximum extent possible and (b) new restrictions would be sought only if unavoidable. Negotiations could be bilateral but there should be multilateral exchange of views on common standards of behavior in administering arrangement re swing, growth, carryover, categorization, export control, trade with non-LTA-member countries, and Article 2 restrictions. Stated HK satisfied with US ideas on liberalization but US only one country and Hong Kong must know intentions of other importers. Emphasized urgency of bilateral discussions and decision on extension.

3. Mexico stated following points should be taken into account in consideration LTA extension: clearer statement of “standstill rule” on restrictions (Article 2) and relaxation of restrictions; tighter definition of disruption (Article 3); specific consideration needs of LDC’s vis-a-vis developed exporters. Cited UNCTAD and Chapter IV of the GATT as desirable basis for LTA.

4. In response Chairman’s request views of importing countries, US del reaffirmed US position that LTA should be extended in present form; noted that US has been and remains available to negotiate bilaterally with exporting countries; accepted procedure proposed by Chairman (reftel, paragraph 3); said US has no problem arranging bilateral discussion but Pakistan proposal to use good offices Secretariat in arranging bilateral discussions could be useful for countries having limited staff and time.

5. Canada supported extension of LTA and emphatically supported view that Article 2 be rigidly adhered to.

6. EEC expressed willingness to hold preliminary bilateral conversations to permit clarification of demands for liberalization. Doubted wisdom of establishing tight timetable for these discussions.

7. India referred to and summarized its views expressed in prior CTC meetings on LTA aspects considered undesirable and India’s proposals for modification. However, agreed with WW suggestions for bilateral discussions. Said deeds not words will show if importing countries prepared to give trade opportunities to LDC’s. Results obtained in these discussions will be considered by India in formulating views it will express in proposed meeting later this year.

8. UK favored LTA extension and expressed willingness to undertake review of UK administration in light of events in the next few months.

9. Norway, Sweden, Colombia, Austria, Spain, Portugal, Finland, Denmark, Israel, Turkey supported extension of LTA and procedure proposed by Wyndham White. Some favored extension without change. Others to varying degree indicated less inflexibility on question of amendment. Several expressed view modifications would be desirable.

10. Meeting concluded with Wyndham White presentation of Chairman’s summary of meeting:

A. Between now and latter part of November, interested countries will determine through bilateral negotiations conditions under which LTA would be administered by individual countries in event it is renewed.

B. WW emphasized that since decision as to future of LTA must be made during the course of this calendar year, bilateral negotiations should be rapid and continuous. Noting proposal negotiations should be centered in Geneva and coordinated with assistance of GATT Secretariat, WW stated Secretariat on request would assist delegations set up negotiating schedule.

C. Re EEC, it understood that negotiations would be arranged through Porte Parole of Community (at present Netherlands) who in consultation with Secretariat of Council would ensure adequate representation to permit effective negotiations.

D. Rather than attempt possible agreement now on guidelines or standards for administration of extended LTA, WW proposed examine possibility that from the results of bilateral discussions a set of understandings be deduced. If understandings could be formulated that could be agreed on, these could both reflect intentions individual countries and give a kind of multilateral recognition of intent under extended LTA.

E. To clarify question raised by HK delegate, WW also said that cotton textile tariff negotiations should proceed in normal course KR negotiations and not await decision on extension LTA, it being understood that certain importing countries might make tariff cuts contingent on extension of LTA.

F. CTC will reconvene November 28. As a negotiating session, length of meeting cannot be foreseen.

G. Suggested consideration be given a change of name from Long Term Arrangement to simply “an arrangement, etc.”

11. Secretariat will circulate written text Chairman’s summary on procedures. EEC reserved Community position pending study of written text of summary but, despite comments re feasibility of completing negotiations within proposed timetable, appeared to accept November 28 date.

12. Harb, Chief UAR delegate, in separate conversation with US rep, confirmed that he would recommend to Cairo that bilateral negotiations be undertaken with U.S.

Tubby

1. Source: Department of State, Central Files, INCO–COTTON 4 GATT. Confidential. Repeated to 26 posts.
2. Telegram 1165 from Geneva, September 29, summarized the third session of the meeting of the Cotton Textiles Committee, which concluded discussion of the annual review. (Ibid., INCO–COTTON 3 GATT)