HC Deb 20 October 1993 vol 230 cc260-1W
Mr. David Martin

To ask the Minister of Agriculture, Fisheries and Food what was the outcome of the Agriculture Council held in Luxembourg on 18 and 19 October; and if she will make a statement.

Mrs. Gillian Shephard

This Council, at which I represented the United Kingdom, considered a proposal from the Commission for changes in the agri-monetary system, made in response to pressure, mainly from Germany, at the previous meeting. Following the changes in the exchange rate mechanism in August, the appreciation of any Community currency beyond a defined limit results in an automatic revaluation of the green rate of the member state concerned and a consequent fall, in terms of that currency, in prices and amounts set under the common agricultural policy. The Commission's proposal would slightly widen the margin within which a currency can appreciate without triggering such a revaluation. I argued that there was no need to alter the existing rules. Germany continued to press for the extension of the "switchover" mechanism to floating currencies, whereby prices in all other member states would be increased in order to avoid a reduction in one.

The Council will return to this issue at its next meeting. Meanwhile, the Commission indicated that it would continue to freeze green rates at their current level. I objected to this, on legal grounds and because farmers and traders had a right to expect that existing rules would not be arbitrarily suspended.

The Council had an inconclusive discussion of the Commission's proposals for changes to the detailed arrangements for arable area payments, including set-aside, and for implementing the agreement on oilseeds reached between the Community and the United States. These proposals will similarly be considered again at the Council's next meeting.

The Agriculture Commissioner, Mr. Steichen, reported on his discussions with the United States trade representative, Mr. Kantor, on the agricultural aspects of the Uruguay round tariff negotiations.

The Council adopted two decisions by qualified majority vote, one establishing a draft supplementary and amending budget for the Community for 1993, and the other authorising the Commission to negotiate with certain banana exporting countries about their rights under the general agreement on tariffs and trade in relation to the changes in the Community's arrangements for bananas agreed last December.

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