Dairy-Farmers Warned Of Common Market’s ‘Dangers’

Press, Volume XCIX, Issue 29245, 1 July 1960, Page 16

Dairy-Farmers Warned Of Common Market’s ‘Dangers’

‘The Press" .Special Service

WELLINGTON, June 30. The dangers to the New Zealand dairy industry if the agricultural protectionist ideas of the European Common Market countries were . implemented, were stressed to the Dominion dairy conference today. by the chairman of the Dairy Board (Mr A. Linton). Mr Linton said the European butter producers’ conference last month showed quite clearly the desire of the six European Common Market countries (Belgium, France, ■ Germany, Italy, Luxembourg, and Netherlands) to maintain high internal prices for dairy produce, to limit imports, to charge substantial import duties and to put these into a fund with which to subsidise their own exports when butter was in oversupply. If such a policy succeeded 11 would, inevitably, have serious repercussions on New Zealand’s dairy industry. It was, therefore essential to protest immediately

those countries dumped their produce on the United Kingdom market. Mr Linton said the marketing proposals of the Common Market countries envisaged the use of practically every weapon of protection—tariffs, quotas or complete prohibition of imports, levies on imports, export subsidies, target and irttervention prices and limitation of production. That was a very formidable list, he said, and if it were carried into effeot in the case of dairy produce it would have serious effects. These would be felt by the Danes in the first instance, as they normally sold large quantities of butter and cheese to Germany. If they were forced out of the German market, the Danes would probably have to ship far greater quantities of butter to Britain where prices would come down and New Zealand would suffer. The original plan, apparently held over, was a uniform price —ss a pound was suggested—in the six countries, which would operate as one unit. Duty on any imports would equal the difference between the world price -—really 'the United Kingdom price—and ss. Proceeds', would subsidise later exports. The dumping that would follow would be so flagrant, said Mr Linton, that it was difficult tp conceive that the United Kingdom Government would allow it. New Zealand perhaps had a greater degree of protection now than previously. The United Kingdom was now one of the “outer seven” countries—Austria. Denmark, Norway, Portugal. Sweden, Switzerland, and the United Kingdom—which had an anti-dumping agreement. Originally it had been hoped that the two groups might be in one common market area, and that might yet happen. If it did. it would be a good thing for New Zealand. The group of seven tended to look outwards, seeking more trade generally. The “outer seven” had an agreement not to damage the interests of others in the group by granting export subsidies, and any product exported from one to another could be re-exported to the supplying country without any duty. In 1958, for instance, the United Kingdom would have been able to buy up dumped butter and' sell it at the ruling prices in the countries of origin. As the United Kingdom was now a member of the “outer seven”;, it was unthinkable that its government would permit any quantity of butter from European Common Market countries to be dumped. Mr Linton assured the conference that the Dairy Board would maintain close touch with the dairy industries of the various countries, and the international agencies likely to have any say in the pattern of dairy produce trading in