Europe agrees to free trade

Press, Volume CXII, Issue 32972, 19 July 1972, Page 15

Europe agrees to free trade

(K.Z.P.A.-Reuter—Copyright >

BRUSSELS, July 18.

Five countries have now agreed to dismantle trade barriers with the European Economic Community and—with Portugal negotiating today’—virtually all of Western Europe could become a free trade zone.

Four members of the European Free Trade Association (E.F.T.A.) —Switzerland, Sweden, Finland and Austria—yesterday ended seven months of tough bargaining on trade links with the Community, which last Thursdaycompleted similar talks with Iceland.

All the E.F.T.A. members need the agreement to compensate for the departure of Britain, Norway and Denmark to join the Common Market.

A settlement with Portugal is blocked at the moment because of a dispute over the price of tomato paste, but today’s talks are aimed at completing an agreement. When the tariff dismantling is completed with the enlarged Community, 16 European countries will be exchanging their goods on a free trade basis. The only exception in Western Europe will be Spain. The agreements, due to be signed in Brussels next Tuesday, differ from country to country but the general outline is the same—free trade for industrial goods within five years.

The reason for the length of the talks has been that certain items have been labelled “sensitive" and in need of special protection measures.

Each country has different priorities, Finland, for instance. being heavily reliant on paper exports and Iceland dominated mostly wholly by fish and fish products. But one major problem involving the agreements remains—the treatment Britain will give to Scandinavian paper exports. Sweden and Finland say that Britain has been trying to use the negotiations as a pretext for reimposing trade barriers on these items.

The dispute now seems to have boiled down to one of how much Scandinavian paper Britain will agree to take in duty free and how strongly she will commit herself to do so. Talks on the issue will continue today.