HL Deb 23 July 1990 vol 521 cc1191-3

2.57 p.m.

Lord Stoddart of Swindon asked Her Majesty's Government:

Whether, in connection with the Uruguay round of the GATT, they have made any calculation of the effects on underdeveloped countries of the removal of agricultural protectionism by industrial countries.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington)

My Lords, reform of agricultural policies worldwide will reduce distortions to trade and lead to more stable trading conditions. Developing countries will benefit from this and from lower import barriers. It is also recognised that the special needs and conditions of developing countries will be taken into account in the negotiations. These have yet to determine the reductions in support that will be made. I cannot comment in detail about the round's likely impact on developing countries.

Lord Stoddart of Swindon

My Lords, I thank the Minister for that helpful Answer and for the obvious personal attention that she has given to the matter. Has she seen some recent work on agricultural protection which shows that less developed countries would benefit to the tune of about £26 billion per year? It would be possible to make a reduction in aid to underdeveloped countries without hurting them and they would be able to reduce their overseas debt by £2.4 billion per year. Under those circumstances, is it not worth the Government putting the utmost pressure particularly on the EC to get rid of the awful agricultural protectionism that operates through the CAP?

Baroness Trumpington

My Lords, I am grateful to the noble Lord for drawing this matter to my attention. Estimates of this kind depend very much on the assumptions that are made. I do not wish to comment on these figures. However, I do not dispute the general conclusion that liberalisation of agricultural policies brings substantial benefits. I should, however, emphasise that the Uruguay negotiations are now focused on reductions and not on complete elimination of support.

The Earl of Onslow

My Lords, is my noble friend aware that agricultural subsidies for the world as a whole for this year amount to something in the region of 240,000 million dollars? Is she further aware that the underdeveloped nations have over-valued currencies and that when cheap corn is dumped upon them their own agricultural systems are subsequently ruined? Russia imports something like 40 million dollars worth of grain a year, and yet only 60 years ago Odessa was the great grain exporting port of the world. Unless we take all these facts into account and do something about the position, there will be quite horrendous trade distortions leading to an impoverishment of world trade.

Baroness Trumpington

My Lords, most studies suggest that multilateral liberalisation would significantly lower market prices for many agricultural products in the European Community. However, many studies conclude that the reduction in the price of dairy products, including butter, could be relatively small.

Lord Jay

My Lords, as the EC, under pressure from the French, is even now trying to obstruct real progress towards freer trade, what are the British Government doing to ensure that these negotiations do not collapse?

Baroness Trumpington

My Lords, I believe that I answered that question in my initial reply to a recent Question from the noble Lord. However, for the benefit of noble Lords, I shall repeat that all parties to the GATT round negotiations have agreed a long-term objective which is to provide substantial progressive reductions in agricultural support and protection, sustained over an agreed period of time, which would result in correcting and preventing restrictions and distortions in world agricultural markets. The UK is working hard with our EC partners to develop the Community's aggregate measure approach.

Lord Gallacher

My Lords, will not the loss of agricultural protection in developed countries lead to a corresponding loss of preference for certain exports by African, Caribbean and Pacific countries into the European Community?

Baroness Trumpington

My Lords, the Houston declaration stated that agricultural negotiations should provide for commitments to be made in an equitable way. We shall seek to ensure that the outcome does not discriminate against British farming structures and that it will proceed in the manner agreed in Houston.

Lord Hylton

My Lords, do the Government agree that agricultural and horticultural producers are always weak sellers of perishable commodities? Is it not a duty of governments to protect them, whether through marketing boards or by other means, from exploitation by powerful purchasers?

Baroness Trumpington

No, my Lords.

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