In the land of the Pharaohs

Press, 9 December 1982, Page 20

In the land of the Pharaohs

Riddles have long been associated with the land of the Pharaohs. Mr Cooper, the Minister of Foreign Affairs, may or may not have left a riddle or two behind while he visited Egypt but he is certainly bringing some home with him. He spoke of the possibility of barter deals with Egypt, over oil for agricultural produce, though he showed a marked disposition to take the money in cash if he could leave behind the bag of troubles that barter deals would bring. Egypt is like other Middle East oil suppliers, anxious to sell more of its oil on a weak and even declining market and would doubtless like to strike deals with those countries from which it imported. Mr Cooper appears willing to be adaptable about the arrangements. The. first riddle he will bring home is how will New Zealand be able to buy Egyptian oil when all the oil that it imports is brought to the country by the big oil companies? Will New Zealand attempt to direct the oil'companies? Will New Zealand start to buy oil in Government-to-Government deals? If recent practice is followed, New Zealand may expect some more of the so-called back-to-back deals in which the Meat Board has made arrangements with a broker to buy oil, the broker has paid for it into an account from which New Zealand has been paid for the meat. But if that is the kind of arrangement which will be made more often, a great deal more expertise will be required from New Zealand in the international oil market. A second riddle: If New Zealand is, by one means or another, going to direct its

purchases of oil to a particular country as part of a deal for that country’s purchase of more New Zealand produce, what happens to existing oil suppliers? At the moment New Zealand gets much of the refined oil it needs, through Singapore. If the idea of bilateral balances of trade catches on, how will Singapore react if .’ New Zealand by-passes it? Singapore’s reaction, is not likely to be confined to Singapore: The whole of the. Association of South-East Asian Nations is likely to become involved and New Zealand will have to consider its trading relations with the five countries of A.S.E.A.N. Other riddles abound. Egypt apparently is not keen on buying butter and meat because of price. Is there a good case for selling meat and butter for less than it can fetch elsewhere because of the long-term prospects in Egypt? Is there a political or foreign policy advantage, if not a commercial advantage, in doing so? Egypt also complained to Mr Cooper that New Zealand had bought American butter to keep up the international price. Perhaps such criticism can be expected from an action that was designed to do just that and has to be accepted. One of the actions that New Zealand is at present performing for Egypt is . contributing to the Multinational Force and Observers in the Sinai near the border with Israel. A riddle exists about that too, because it is not at , all certain how long it will need to be there. If the presence of United Nations forces in the Middle East is a guide, it is a sobering reflection that the mandate of none has been cancelled.