I move: "That Dáil Éireann approves the terms of the International Natural Rubber Agreement, 1979."
Dáil approval of the terms of this agreement is necessary in accordance with Article 29.5.2 of the Constitution which stipulates that "the State shall not be bound by any international agreement involving a charge upon public funds unless the terms of the agreement shall have been approved by Dáil Éireann". An explanatory memorandum on this agreement has been prepared and circulated to Deputies. This gives a detailed account of the provisions of the agreement and covers the question of the costs involved in Irish participation in it. I propose then to confine myself to making some general remarks.
The International Natural Rubber Agreement, 1979, was concluded under the auspices of the United Nations Conference on Trade and Development (UNCTAD) at the United Nations Conference on Natural Rubber held in Geneva in October 1979. It is open for signature at United Nations Headquarters until 30 June 1980 by the Governments invited to the United Nations Conference on Natural Rubber. Instruments of ratification, acceptance or approval must be deposited with the Secretary General of the United Nations not later than 30 September 1980.
The Council of the European Economic Community, on 22 April 1980, decided that the agreement should be signed subject to its being concluded at a later date, on the basis of joint competence by the Community and the member states.
Some 62 countries, including Ireland, representing 13 exporting countries and 49 importing countries, participated in the United Nations Conference on Rubber.
The International Natural Rubber Agreement is the first commodity agreement to be concluded since UNCTAD established its Integrated Programme for Commodities in Nairobi in May 1976. As such, it is a significant development and will make an invaluable contribution to the on-going debate on economic relationships between the developed and the developing countries.
The main objectives of this agreement are to achieve a balanced growth between the supply and demand for natural rubber, to stabilise conditions in the natural rubber trade through avoiding excessive price fluctuations, to ensure adequate supplies at reasonable prices equitable to both producers and consumers and to help stabilise the export earnings of the developing countries from natural rubber, a matter to which these countries quite naturally attach the utmost importance. The agreement establishes the International Natural Rubber Organisation to administer its provisions and supervise its operation. The organisation will function through the International Natural Rubber Council, its executive director and staff and such other bodies as are provided for in the agreement. For the purpose of achieving the objectives of the agreement a buffer stock consisting of a total of 550,000 tonnes will be established. The council of the organisation will appoint a buffer stock manager and he will offer to buy and sell natural rubber in a manner designed to keep its price within an agreed price range.
The financing of the buffer stock will be met by direct Government contributions and/or by Government guarantees. The contributions will be shared equally between the exporting and importing members. Within the importing group each member shall meet an apportionment of the cost based on its number of votes in the council and these shall be allocated relative to its share of net imports of natural rubber averaged over the preceding three years. At this stage it is not possible to assess accurately Ireland's apportionment of these costs because of the variables involved, such as the number of countries likely to adhere to the agreement and the quantity of rubber which may be purchased by the buffer stock manager at various price levels. However, based on a formula suggested for estimate purposes by the UNCTAD conference chairman and assuming a membership by Governments representing at least 80 per cent of total world net imports and net exports, the cost to Ireland would be approximately £330,000 — this would be a once only contribution.
In addition members of the International Natural Rubber Organisation will be required to make an annual contribution to the administrative budget of the organisation and to undertake any travelling expenses which may arise in connection with attendance at its meetings. Ireland's contribution to this budget, will also be in proportion to its number of votes in the council. Again it is not possible at this stage to state accurately the amount of Ireland's contribution under this heading but based on our experience in other commodity organisations it is estimated that at current values it will be in the order of £1,000 per annum.
The agreement will help to stabilise raw material prices for an important segment of Irish industry. The Irish rubber using industry provides employment for approximately 2,800 persons. Ireland imported 7,821 tonnes of natural rubber valued at £5.1 million in 1979. In the same year Ireland exported 27,000 tonnes of tyres and tubes valued £30.8 million.
Membership of the International Natural Rubber Agreement, 1979, will afford Ireland the opportunity to demonstrate its readiness to support international measures to stabilise commodity prices and to reaffirm the importance which it attaches to eliminating the economic imbalance between developed and developing countries.