HC Deb 04 April 1979 vol 965 cc733-6W
Mr. Whitehead

asked the Secretary of State for Foreign and Commonwealth Ministers if he will make a statement on the Council of Foreign Ministers of the European Communities held on 2 and 3 April.

Dr. Owen

The United Kingdom was represented at the Foreign Affairs Council on 2 and 3 April by my right hon. Friend the Secretary of State for Trade, and myself. There was also a joint Foreign Affairs-Finance Council on 2 April at which I was accompanied by my right hon. Friend, the Minister of State, Treasury.

The major outstanding points in the Greek accession negotiations were settled at the joint EEC-Greece ministerial negotiating session which followed the Foreign Affairs Council. Subject to the settlement of a number of minor points, and to the need for the preparation of final, detailed texts, it is hoped that signature of the accession treaty will take place in Athens towards the end of May.

At the Foreign Affairs Council, subject to a reservation from one member State, there was agreement that the Commission should initial the text recording the outcome of the GATT multilateral trade negotiations. After long debate, the council agreed to a number of commitments which have largely met the remaining difficulties in the package for the United Kingdom. In the textile sector the council stated that the tariff cuts were conditional on the continuation of a mutually acceptable arrangement regarding international trade in textiles, and declared its intention to take appropriate steps under the GATT if differences in energy and feedstock prices led to a threat of disruption to the Community market for synthetic textiles. A number of special measures for the paper and board industry were agreed. The council also agreed to continue negotiations for a multilateral agreement on safeguards, but meanwhile noted a Commission statement that selective safeguard action may be appropriate in cases of sudden and abrupt market disturbance and agreed that the Community could act in the light of previous selective applications of article XIX of the GATT. This Community agreement to the outcome of the multilateral trade negotiations is very welcome to the British Government.

Ministers instructed officials to consider further the problems that have arisen over the timing of the closure of the polls of direct elections in member States.

It was agreed that the Commission should have further bilateral discussions with the United Kingdom and Italy on the revised proposals concerning State aids to the steel industry. The council will consider the matter again on 29 May.

There was a brief discussion of the negotiations for a voluntary restraint arrangement on Spain's steel exports and of the related question of the United Kingdom anti-dumping duty on Spanish stainless steel bar. Discussions are continuing with a view to finding early solutions.

Commissioner Haferkamp reported to the council on his recent visit to Tokyo for high-level talks with the Japanese Government during which he had stressed the need for improved access for Community exports to the Japanese market. The council agreed to keep the situation under review in the run-up to the Tokyo Summit in June.

Consideration was given to reports of officials on the various items on the agenda for UNCTAD V; and the council approved the preliminary guidance they contained. In accordance with the council's decision at its last meeting in March that UNCTAD V is a politically important step in the north-south dialogue to which the Community must make a properly prepared and positive contribution, the council confirmed that Community co-ordination was important and that the detailed work should be completed as soon as possible. The council will return to this subject at its meeting on 8 May.

Following previous discussion by agricultural Ministers some progress was made towards agreement on support measures for new potatoes under a Community regime, which could facilitate the early removal of current obstacles to implementation of the agreed tariff concessions for 1979 Cyprus new potatoes.

The current negotiations with China for an agreement on trade in textiles were discussed but the council was not able to reach final agreement on the details of the offer to be made to China.

The council also considered matters arising out of negotiations with Turkey, Yugoslavia and the ACP countries.

The Joint Foreign Affairs-Finance Council considered the suggestions for raising the ceiling of own resources revenue contained in the Commission's discussion document "Financing the Community Budget—The Way Ahead"which was debated in the House on 21 February 1979. In its general discussion of the pattern of budget expenditure, the council had before it the Commission document "Global Appraisal of the Budgetary Problems of the Community".

My right hon. Friend the Minister of State, Treasury stressed the need for the introduction of progressivity in member States' budget contributions so as to make the revenue side of the budget re-distributive in effect and contribute towards the aim of economic convergence. A very strong progressive factor was essential in order to offset the regressive nature of customs duties and agricultural levies.

I stressed that the existing pattern of net contributions to the budget was totally at variance with the goal of economic convergence. The United Kingdom's present adverse budgetary and non-budgetary resource transfers reduced real income, increased the public sector borrowing requirement and thus caused higher interest rates which in turn discouraged the investment needed for us to build up our economy. I made clear that we would not agree to any new own resources until the CAP was brought under control and budgetary burdens shared more equitably.

Discussion in the Community of both Commission documents will continue.