HC Deb 22 February 1971 vol 812 cc43-51
The Chancellor of the Duchy of Lancaster (Mr. Geoffrey Rippon)

With your permission, Mr. Speaker, and that of the House, I should like to make a statement about my visit to the Commonwealth countries of the Caribbean, from which I returned yesterday.

At the invitation of the Governments concerned, 1 visited Jamaica, Guyana, Trinidad and Tobago, and Barbados. In each 1 met the Prime Minister and Ministers concerned with our negotiations for entry into the European Economic Community. I also visited St. Lucia, where I met Premiers and representatives of each of the West Indies Associated States.

I was particularly glad to have the opportunity also of seeing representatives of trades unions as well as employers, and representatives of Opposition parties as well as Ministers and officials. In this way I was able to build up a more comprehensive idea of the many problems involved from different points of view. I am most grateful to all who made this possible, and above all to the Governments who were my hosts.

Our discussions covered three main problems: sugar, the future relationship which the independent Commonwealth governments may have with the Community, and the corresponding relationship of the West Indies Associated States, for whose external affairs we remain responsible.

First, sugar. From the very beginning of the negotiations, we have identified the need for access for sugar from the developing Commonwealth countries to an enlarged Community as one of the three major problems of the negotiations.

I explained that we had put in proposals on this point to the Community, but had not yet received the Community's reply. I said that what indications we had had of the Commission's thinking showed that those concerned fully understood the problem and were anxious to find a solution which would permit continuity of access under a new sugar régime applicable to the enlarged Community as a whole.

So far as the Commonwealth Caribbean Governments and sugar producers are concerned, the principal problem is to be able to plan production ahead with a similar degree of assurance to that which they now enjoy under the Commonwealth Sugar Agreement. For this they require what the Jamaican Minister of Trade and Industry described to me as "bankable" assurances; in other words, assurances which would persuade bank managers to provide the credits necessary for the roll-on of sugar production. Cane sugar production, unlike beet sugar production, has, of course, to be planned a number of years in advance.

A number of anxieties were expressed to me, but nearly all turned on this point.

I was particularly impressed by the social aspects of the problem. The economies of the countries concerned are dependent upon sugar in varying degrees, but restriction or dislocation of the market would severely affect them all, and in some would lead to serious consequences in human as well as economic terms.

Similar considerations of course apply to the other developing members of the Commonwealth whose economies are dependent upon sugar, notably Mauritius and Fiji.

Next I turn to the question of the future relationship between the independent Commonwealth Caribbean countries and an enlarged Community. There seems to have been a good deal of misunderstanding on this point, which I hope I was able to clear up.

The problem is this: as the House will know, the Community has already reaffirmed the offer contained in its 1963 Declaration of Intent to the Commonwealth African countries. This offer in no way commits the Governments concerned. But it will enable them to choose whether they wish to have a Yaoundé-type of association with the enlarged Community, or a looser form of association, or a simple trading agreement.

The Community has not yet renewed this offer to the Commonwealth countries, but I very much hope it will do so soon.

The problem of the Commonwealth Caribbean is not simply one of sugar. The countries concerned need continuing access to the British market and ultimately to the European one for such other tropical products as bananas, citrus fruits and rum. Without such access—especially for bananas—grave damage would be done to the economies concerned. These developing countries, who have for centuries been dependent on the British market, need arrangements, such as association would provide, which would give them the same sort of treatment now given to other developing countries associated with the Community.

Lastly I come to the future relationship of the West Indies Associated States with an enlarged Community. I am glad to say that at the meeting of Deputies in Brussels on 10th February, the Community lifted its reserve on the offer of association under Part IV of the Treaty of Rome to those territories, other than Gibraltar and Hong Kong, for whose external relations we remain responsible. This will ensure that their interests will be safeguarded.

Some concern was expressed to me lest there should be any difference in the positions of the various members of C.A.R.I.F.T.A., the Commonwealth Caribbean Free Trade Area, which includes both dependent and independent countries. I said that I hope that with an offer of association to them all, a common C.A.R.I.F.T.A. position might be elaborated. Without such an offer to the independent countries, the position would of course be more complicated. In any case we shall do our utmost to protect the interests of the West Indies Associated States, and give them all the help and advice they may require.

I have spoken today of serious problems which could affect the success of the negotiations. I have no doubt that solutions can be found to all of them. So far as the Commonwealth Caribbean is concerned, the most dangerous element in the situation is uncertainty. I hope this may be cleared up very soon.

Mr. Hattersley

The whole House will be very grateful to the right hon. and learned Gentleman for that very long statement.

Is he aware that we on this side of the House regard the provision of adequate safeguards for Commonwealth Caribbean interests as essential if we are to enter the E.E.C.? As the right hon. and learned Gentleman is clearly optimistic about obtaining such safeguards, judging by his statement today, can he tell us whether the Governments he visited share that optimism, or whether they were rather more pessimistic about the outcome in Brussels?

In the light of that, I have two specific questions about sugar. The right hon. and learned Gentleman says very properly in his statement that what is needed is bankable assurances for the sugar producers. Will he therefore say, first, whether the note of August, 1970, which outlined the Government's proposals to the E.E.C. for safeguarding Commonwealth sugar, still maintains the Government's position as to what is necessary rather than representing a negotiating position? Second, can he make it absolutely clear that the arrangement for sugar producers will be safeguarded and negotiated before entry into the E.E.C. and not allowed to wait until the Commonwealth Sugar Agreement comes to its natural break in 1974?

Mr. Rippon

Naturally, the various Governments to which I spoke expressed their anxieties. They did not seem unduly disturbed about the position as it now stands, and we reached agreement on the attitude which we should all best adopt.

As to the proposals which we have made to the Community, as I said in my statement, these are on the table and we await the Community's reply.

One of the matters which is of concern is not merely that we should be able to maintain our legal obligations until 1974 under the Commonwealth Sugar Agreement but that a view should be taken by the Community and ourselves as to what should happen thereafter to protect the position.

Mr. Hattersley

I am grateful to the right hon. and learned Gentleman, but perhaps I did not put my final two questions clearly enough, I asked him, first, not whether we needed to maintain our position until 1974, but whether our relationship with the sugar producers after we joined the E.E.C. would be made clear before we entered rather than awaiting the break in the Treaty in 1974. Secondly, I asked whether the August proposals genuinely represented what we regard as necessary rather than a negotiating position.

Mr. Rippon

Naturally our proposals represent what we regard as fair and reasonable. We must, however, await the Community's reply. I have no reason to suppose that the reply will be unfavourable or will not take account of the point the hon. Gentleman makes on the necessity for seeing beyond 1974 in as much detail as possible.

Mr. Turton

Does not my right hon. and learned Friend agree that associated status alone would not be a fair and reasonable provision, but that there must be some continuing arrangement for import-export quotas from the Caribbean and the Windward Islands, both for sugar and bananas, since otherwise we could not possibly agree to enter the E.E.C.?

Mr. Rippon

My right hon. Friend is right to say that a mere offer of association or arrangements of that kind would not be sufficient to cover sugar. That is why the matter is being dealt with separately. In any case an agreement about sugar would not of itself be sufficient to cover the problems relating to other tropical products, including, for example, bananas.

Mr. James Johnson

Is the right hon. and learned Gentleman aware that under the existing arrangements in the Community the Italians are allowed to buy all the bananas produced by their former colony, Somalia? Can there not be a similar arrangement for the West Indian Islands on the same basis?

Mr. Rippon

Where it is the case that association or community agreements have not obtained, then it is necessary for us to ensure—as we certainly would—that we got the same sort of arrangements for our own traditional suppliers as the present Community nations have arranged for themselves. Such arrangements have applied not only to Italy but also to Germany and France.

Sir J. Rodgers

Can my right hon. and learned Friend tell us what the attitude of the United States is to closer association between the Caribbean Islands and the enlarged Community? Is he aware that when I was in the area which he has just visited quite recently it was alleged that the United States was threatening retaliatory action if closer association were obtained? If that is so, when he visits the United States in March, will he make the strongest representations against this deplorable attitude on the part of the United States?

Mr. Rippon

The United States has indicated anxieties about the extension of association agreements to Commonwealth countries in Africa as well as in the Caribbean. It has also said that it will not include in its offer under the generalised preferences scheme countries which are members of preferential trading arrangements. This might present what one Caribbean Minister described to me as "Hobson's choice" to the countries of the Caribbean. They have their preferential trading arrangements with us and it seems to me that we should seek to preserve them. They also have trading interests with the United States. In my view, certainly they should not be obliged to choose in any way between the United States and Europe.

Mr. Hamling

Would not the right hon. and learned Gentleman agree that a continuation of the existing trading agreements is really insufficient and that what the Government ought to be considering is further assistance to the islands of the Caribbean, not only because of their general poverty but also because of the parlous condition of the banana production business and, on the island. of St. Vincent, of arrowroot production?

Mr. Rippon

Their economies are certainly vulnerable and the mere maintenance of their existing trade in such commodities as sugar and bananas by no means solves the problems of these developing countries. Therefore, there is need for further aid of various kinds, but that is not a matter for me to deal with today. One would envisage that they would benefit from the funds available to the European Development Fund in addition to any aid we might continue to give ourselves.

Sir D. Renton

Is my right hon. and learned Friend aware that the present Commonwealth Sugar Agreement has the effect of giving a guaranteed price for substantial tonnages of sugar imported from the Commonwealth to this country, as well as a guaranteed price for sugar produced from beet in Britain? Can he tell us what form the support would take in the event of our entering the Community in relation both to Commonwealth cane sugar and sugar from beet in Britain?

Mr. Rippon

We have explained to the Community our existing obligations under the Commonwealth Sugar Agreement. It is a complicated agreement, but basically what it assures is continuity both as regards quantities and prices. These are factors we shall have to deal with in the course of our negotiations. One of the complications is that the Community itself has arrangements with its own associated States which fall to be renegotiated in detail in 1975. There is also the problem that, whereas we are members of the International Sugar Agreement, the Community is not at present. Thus, a rather curious situation might arise in which some members of the Community were parties to the International Sugar Agreement and others were not. We shall have to consider how to resolve that problem.

Mr. McBride

Will the hight hon. and learned Gentleman now confirm to the nation that there will be a steep increase in the price of sugar to the housewives from Commonwealth producers should we enter the Community? How can the right hon. and learned Gentleman say to the single-product nations of the Caribbean that they may plan ahead when such a position is reached?

Mr. Rippon

Negotiations take place periodically under the Commonwealth Sugar Agreement and the next round is due next autumn. I cannot forecast exactly what might happen then. Some of the people I spoke to in the Caribbean—including both producers and trade unionists-made representations to me that one of the best forms of aid is to pay primary producers the proper price for what they produce.

Mr. Hugh Fraser

Would not my right hon. and learned Friend agree that the possible threat from the United States relating to its sugar quota—which is probably as important as ours—puts the West Indies into a very difficult situation regarding associated status? As my right hon. Friend the Member for Thirsk and Malton (Mr. Turton) rightly pointed out, what really matters to the West Indies is a guaranteed price for sugar and bananas, and associated status for surplus produce will be of no great benefit.

Mr. Rippon

Each country in the Community has made special arrangements for bananas because there are no banana regulations at the moment in the Community. I think that we can deal with this aspect. The sale of sugar by the Caribbean countries is not dependent solely on the British market. They are concerned about their access to the United States market under the United States Sugar Act, which falls to be reviewed this year. Half their quota is borrowed from Cuba and a restoration between Cuba and the United States would create difficulty. This is why I said that small developing countries should not be faced with a choice between access to the United States and access to the British or European markets. They need them all.

Mrs. Hart

One is glad to know that the discussions held by the right hon. and learned Gentleman in the Caribbean were in a wider context which included development aid as well as trade. Did he make it clear that whether or not they benefit or lose from possible British entry to the Community and from our association with the European Development Fund will depend very much on whether they choose a Yaoundé-type of arrangement or a looser type of arrangement? In either case, is it not likely that the Caribbean countries will lose considerably on development aid from Britain?

Mr. Rippon

I can just say that I think it terribly important that they should have the widest choice possible, varying from a Yaoundé-type association to various forms of trade agreements, and that provided we negotiate an offer on the same basis as that of 1963 or a similar basis there would be full opportunities for discussions between us and them and directly between them and the Come munity about the form of that association or trade agreement and the way it would protect their vital interests.

Several Hon. Members


Mr. Speaker

I should like to call everyone but it is simply not practicable.