Top trade leaders celebrate butter access

Press, 24 July 1986, Page 3

Top trade leaders celebrate butter access

By

MARTIN FREETH

in Wellington

Agricultural trade leaders sighed with relief yesterday at the favourable butter access quotas granted by the European Community but warned that the going is likely to get even harder for New Zealand in two years. New Zealand’s effort to maintain a toehold on the British butter market after 1988 will now turn to forthcoming negotiations under the G.A.T.T. agreement to push the general case for liberalising world agricultural trade. The Minister of Overseas Trade, Mr Moore, says it will take another two years hard work, both within G.A.T.T. and lobbying the European Community direct, to ensure continued access for New Zealand butter.

However, yesterday was a time for celebrating the next two years access, worth about $535 miilion in export earnings at current exchange rates and prices. The European Foreign Ministers agreed on quotas of 76,500 tonnes next year and 74,500 tonnes in 1988, representing a 500tonne cut in the recommendations of their officials earlier this month.

At a press briefing in his office, Mr Moore opened bottles of champagne to toast the outcome with his fellow Cabinet Ministers, Messrs Moyle and O’Flynn, the chairman of the Dairy Board, Mr Jim Graham, the president of Federated Farmers, Mr Peter Elworthy, and the president of the Seamen’s Union, Mr Dave Morgan. All were participants in Mr Moore’s two-year strategy before the quota decision, and yesterday

each praised the contribution of the others. Mr Graham described the quotas as a reasonable compromise and said the issue had been one of the most difficult New Zealand had faced since British entry to the European Community. Mr Moore hinted the strategy had almost come unstuck with a recent proposal that access be reduced 61,000 tonnes over the two years. He declined to elaborate, except that it had been an Informal proposal mentioned to him during his last trip to Europe six weeks ago.

“The fact that we have access at all into Europe is seen by many powerful European organisations as an anomaly and something wrong,” he said.

The arbitration ruling on the Rainbow Warrior dispute removed the prospect of the French using a veto against quotas supported by other Community members as a means of pressuring New Zealand. At last week’s session of European Agricultural Ministers, it was Ireland which exercised a veto.

Mr Moore said the Government had made sure the butter access issue was included in arbitration over the dispute with France. It was not possible now to say whether the French would have vetoed the quotas now settled had the dispute not been resolved, he said.

Mr Moore said the strategy of the last two years had included a deliberate policy of not laying the blame for problems facing New Zealand farmers on the protectionism of trading partners, including the Europeans. Mr Moyle said lobbying in Europe had also had to counter a growing

chill towards New Zealand farmers from their British counterparts, arising from new restrictions imposed on the production levels of the latter.

“We had to get in there and counter that extra factor which was not there previously and to show that there was greater than equality in the sacrifice made by New Zealand farmers,” Mr Moyle said. In the end, Britain had been to the fore in pushing New Zealand’s case for access. Mr Moore said he was also grateful to the Dutch and the Germans for their support and tactical advice. He speculated that the Irish Government might have a difficult time explaining to its dairy producers why the quotas now settled were not vetoed.

Reviewing factors that will have to be faced in future access issues, the trade leaders pointed to the increasing pressure on European farmers and surpluses of Community product

Britain still had much good will towards New Zealand but it was now counteracted by a growing soreness among farmers, Mr Graham said.

The Dairy Board now awaits a further European response to its proposal to isolate its surplus and about half that of the Community for processing into butter oil and sale at a loss.

Mr Graham first proposed the surplus disposal plan in April and after its acceptance in principle by the Europeans, the details have now to be worked out

He said yesterday that the question of surpluses was vital for the acquisition of butter access after 1988. Mr Moore will attend a meeting in Australia late

next month of Ministers from agricultural producing countries to prepare for the G.A.T.T. round of negotiations, to start in Montevideo in September.