The Press TUESDAY, MAY 17, 1966. The E.E.C.’s Next Hurdle

Press, Volume CV, Issue 31061, 17 May 1966, Page 16

The Press TUESDAY, MAY 17, 1966. The E.E.C.’s Next Hurdle

The agreement reached at Brussels last week on dismantling the remaining tariffs among the Six and on the establishment of a fanning fund is the most important decision reached by the European Economic Community in the last three years. Tariffs inside the E.E.C., now only 20 per cent of their pre-1958 levels, are to be reduced on July 1, 1967, and finally eliminated 12 months after that. The framework of the controversial European Agricultural Guidance and Guarantee Fund was approved and the respective national contributions to the fund settled. The modernisation grants to be paid from the fund—a small proportion of the total annual disbursements, but a matter of great concern to Italy—were fixed at £62 million a year. This programme, however, is still tentative; it is all conditional on agreement, by July this year, on common prices and agricultural regulations. Some commodities, of which wheat is the most important, are already traded with the E.E.C. at prices fixed by the Community. By 1964 half the agricultural proare already traded within the E.E.C. at prices fixed by the common policy of the Six. Since then further progress has been made and more products brought under the common policy, some of them only partly subject to this policy. A range of prices has been fixed for some products which are still supported, by one measure or another, by Governments in the producing countries. Milk, for instance, has been priced within the E.E.C. since April 1 this year at 33 Deutschmarks to 41.20 Deutschmarks a hundred kilogrammes—about 10s to 15s a gallon. The common agricultural policy will ultimately substitute a single price for each range of prices, and a single support scheme for a multitude of schemes. The negotiation of these prices and supports is the last major task for the Council of Ministers. Although the structure of the agricultural fund, its size, and the allocation of national contributions — by now all disposed of—may appear the more formidable assignment, the fixing of prices will raise thorny political problems. In the first instance, the structure of the agricultural fund can have had only minor political effects even in Germany, which will be called on for about half the fund’s annual contributions; but the meanest peasant knows what is meant by a reduction from, say, 3.16 francs a kilo to 3.0 francs in the price he is to receive for his beef. Ministers who agreed at their last session to commit their Governments to an extra £lO million a year to get agreement on the establishment of the fund might be much more difficult to budge at the “ ld- “ per-lb ” level at the next session. The successful outcome of the last meeting of the Council, however, augurs well for the next session. Britain and her partners in the European Free Trade Association and the British Commonwealth await the outcome of the next meeting with interest and with varying degrees of concern. When the long-awaited common agricultural policy is finally agreed detailed study of its implications will be possible. At this stage, New Zealand can take some comfort from the reflection that, even before Britain’s expected admission to the E.E.C., the Community is a big, and growing, importer of agricultural products.