HC Deb 04 May 1938 vol 335 cc863-6
57 and 58. Mr. Alexander

asked the Secretary of State for the Colonies (1) whether an agreement has been entered into with the approval of the Government of the Gold Coast controlling the export of cocoa for a period up to Octber, 1938; who are the parties to the agreement; and who was consulted before the agreement was approved;

(2) whether he is aware that many Gold Coast traders consider that the quotas fixed for cocoa exports from West Africa up to October, 1938, are calculated to protect the firms who have been parties to the buying pool and are detrimental to both native producers and independent buyers; and what steps he is taking to prevent this?

59. Mr. Creech Jones

asked the Secretary of State for the Colonies whether he can make a statement as to the position of the dispute in the cocoa trade in South Africa?

Mr. Ormsby-Gore

I apologise for the length of the reply. As the hon. Members will be aware, the greater part of the present season's Gold Coast cocoa crop has not so far come upon the market. At the beginning of the season the majority of firms buying cocoa on the Coast entered into an agreement regarding the terms of their operations. As the growers in the Gold Coast considered that the existence of such an agreement was detrimental to their interests, they for several months refused to sell their cocoa and this hold-up applied not only to the agreement firms but also to other firms who were not parties to the agreement. In order to facilitate the solution of this deadlock and to prevent the large accumulated stocks of cocoa from being placed suddenly upon the market at a rate beyond its capacity to absorb them, the Government of the Gold Coast have recently passed legislation to control the export of this year's crop. The legislation is purely temporary and will remain in force only until October.

I am happy to say that, partly as a result of this legislation, the parties to the agreement have now suspended it and the hold-up of cocoa by the growers has been brought to an end. During the negotiations which have led to this result the terms of the legislation which has been passed were naturally discussed with both parties, that is to say, with the agreement firms on the one hand and with the representatives of the growers on the other hand. Under this legislation the greater part of the licences to export cocoa up till 1st October will be allotted to each firm engaged in the trade in proportion to its share of the trade in each of the last two crop years. Each firm will thus be able to enjoy the same share of the trade that it has had in the past. The remaining licences representing 6 per cent. of the total exports or a minimum of 2,000 tons a month will be retained by the Governor for allocation at his discretion, and it is the intention that this discretion should be exercised particularly in favour of African shippers. This amount is much larger than that ever exported by African shippers in the past.

I cannot accept the suggestion that the quota legislation is detrimental to the African producer. I am sorry that it should be considered unfair to any other interest, but the great difficulty will be appreciated of discovering any basis for the allocation of licences in the existing difficult situation which is not open to some criticism, and I am satisfied that on no other basis consonant with due regard to the interests of all parties would it have been possible to secure both the termination of the hold-up by the producers and the suspension of the Agreement by the firms concerned. This was the primary objective, and it is clear that its attainment will benefit all firms trading in the Gold Coast whether they have been parties to the Agreement or not. Before next season's crop I hope to have received the report and recommendations of the Special Commission now in West Africa on any future arrangements regarding the sale of cocoa.

Mr. Alexander

Is the Secretary of State aware that all the independent firms who had refused to join the buying pool agreement which depressed the native growers' prices have been left out of consultation in making this quota agreement with the pool, and that in consequence many of them will not get their requirements for the current season without going to the pool and paying enhanced prices to the pool?

Mr. Ormsby-Gore

I could not answer that. That is a strictly business matter; hut the great thing is that all the firms trading in the Gold Coast will get quotas in proportion to their trade in the past two years. That is the only fair way of dealing with the emergency.

Mr. Burke

Can the right hon. Gentleman tell us whether the prices offered to the growers will be increased, and, if so, to what extent?

Mr. Ormsby-Gore

I cannot possibly tell that, because it depends upon world prices. We cannot control world prices.

Mr. Burke

Is the right hon. Gentler-an aware of the fact that as a result of the depression of prices, due to the activities of the pool, trade temporarily stopped, and that if prices do not increase, the same detrimental effect will occur again?

Mr. Ormsby-Gore

The hon. Gentleman uses the word "pool." Of course, the firms participating in the agreement deny that there is a pool. [HON. MEMBERS: "Oh! "] I do not say whether it is right or wrong. Surely, it does not depend on any firms in the Gold Coast as to what the price of cocoa is, because that is fixed by the price on the New York market.