Joint Committee on the Secondary Legislation of the European Communities debate -
Wednesday, 3 Nov 1976

Generalised Tariff Preference Scheme for 1977.

Chairman

Our last meeting was on the 30th June just before the recess and we dealt with a lot of business. The minutes of that meeting have been circulated.

There is only one item on the agenda today. In connection with this item, members will recall that last year we did not have an opportunity of dealing with the Generalised Tariff Preference Scheme for 1976 until it was too late. This year we are anxious to get out a report on the 1977 proposals before they are finally decided by the Council. The draft Report is here and most of the Members present took part in our sub-committee discussions and are therefore familiar with all the items in it.

Paragraphs 1 to 9, inclusive, agreed to.

Chairman

An amendment to the draft Report put forward by Senator Alexis FitzGerald has been circulated. Senator FitzGerald wishes to direct the attention of the Oireachtas to the fact that some of the more developed beneficiary countries might get an unfair advantage over us in this generalised tariff preference scheme, in so far as these countries might be competing against us in relation to foreign investment. Would anyone like to comment on this amendment?

Deputy Esmonde

I formally move the amendment in the absence of Senator FitzGerald who is ill. It is important to incorporate this amendment in the draft Report. I am not detracting from it. It is a very good and very full draft Report, but investment is an important matter for us and if there is no proper economic criteria by which the beneficiary countries are selected and allowed to have these preferences under the Market tariff scheme, we might be defeating the purpose of the idea behind these tariff preferences. We can only regard ourselves as having an underdeveloped economy nowhere near our potential, and it is essential that Senator FitzGerald's proposal be incorporated. There are also references in the amendment in relation to regional and social and other subventions which are made on Common Market policies. I will read out the amendment for the purposes of the Official Report. The amendment is to paragraph 10 on page 7 of the draft Report. The amendment proposes to add the following sub-paragraph:

It may be that Ireland has a particular interest in ensuring that beneficiary countries are selected solely by reference to acceptable economic criteria. It can scarcely be contested that because of her underdeveloped economy Ireland has a far greater need of foreign investment than other Community countries without which there would be needed by Ireland from the EEC far greater regional, social and other subventions. It would be unfair if the advantages enjoyed under the generalised tariff preference scheme by the more developed of the beneficiary countries made it more difficult for Ireland to attract badly needed investment. The Joint Committee suggests that this aspect of the matter be examined by the appropriate authorities here.

That is a balanced and sensible addition to our report as it highlights our circumstances within the Community as being one of the countries declared as an area for regional policies affecting the whole country.

Deputy M. E. Dockrell

The amendment relates only to the more developed of the beneficiary countries, it does not object to the beneficiary countries as such. Brazil is one of the more developed beneficiary countries and indeed some of the Arab States with their vast wealth could be described as not generally considered developed beneficiaries from the finance point of view. At any rate that is the gist of the amendment.

Chairman

In the body of the draft Report it is stated that:

The Joint Committee believes that Ireland should support those who are pressing for a review of the list of beneficiary countries. It fully supports any policy of aiding countries which are in a worse position than ourselves but it cannot accept that some countries which benefit under the GSP scheme come within that category and it is not persuaded that the scheme as it is operated at present benefits those countries which are most in need of assistance.

That is perfectly true. I have no objection to Senator FitzGerald's amendment. Does anyone wish to comment? May I take it that the amendment is accepted?

Senator E. Ryan

Does the amendment not approach this problem from a slightly different point of view? The draft Report suggests that some countries which do not really need it will benefit. The amendment is really talking about looking at the countries from the point of view of how they affect Ireland.

Chairman

The Senator's basic point is that some of these countries are not to any great extent less developed than we are. They are competing with us for world or international investment and we have to keep that aspect in mind. It does not ask any more than that aspect be examined.

Senator Robinson

There is the other aspect that there is only a certain amount of development aid and it should go more directly to those most in need.

Chairman

We make that point in our draft Report.

Deputy Esmonde

If our interests are looked after we may not have such demand for aid from the EEC if we are allowed to be part of it ourselves by investment.

Chairman

I take it that Senator FitzGerald's amendment is accepted.

Amendment agreed to.

Paragraph 10, as amended, agreed to.

Chairman

Unless someone wants to comment on any other particular aspect of the report, I take it that it is acceptable to the Committee also. Deputy Esmonde at an earlier stage mentioned Irish Steel Holdings.

Deputy Esmonde

I am just wondering whether Irish Steel Holdings are a little bit sanguine in their approach to this matter. We refer to this at paragraph 9 of our report:

The Company would like to see national quotas set limiting the amount for each Member State. Otherwise, it fears that an undue proportion of these imports may be diverted to Ireland leaving it particularly vulnerable to imports of angles, shapes and sections.

They do not seem to push it any further than that. They do not seem to be too concerned. I understand the steel industry in Europe is in considerable difficulties at the moment. I am just wondering whether there might be something further. The report says: "Irish Steel Holdings Ltd. has accepted this position while reserving its right to raise the matter again next year in the light of its experience in the meantime." I wonder if that leaves sufficient room for manoeuvre. Does it highlight the dangers implicit in this whole production in Europe at the moment in the steel industry?

Chairman

Whatever about the steel industry in Europe generally, Irish Steel Holdings' interest is of a very narrow, limited sort. The Department pointed out to us that we have never imported any of these things so we would not be in a strong position to look for a national quota for these products—angles, shapes and sections.

Deputy Esmonde

You mean we do not import them as yet.

Chairman

From the countries involved.

Deputy Esmonde

This is what worries me about it. I know these are judged by the matter of their origin. There can be various processes. I wonder how much is being brought to this country at the second stage.

Chairman

So far as I know, Irish Steel Holdings are a sort of secondary product industry. They do not make steel. They take steel products and refabricate them, as it were.

Senator E. Ryan

Are Irish Steel Holdings the only people who might be affected by this?

Chairman

Apparently. They have accepted the position.

Senator E. Ryan

If they are the only people affected and they are happy to leave it for a year I think we can accept that.

Deputy Esmonde

One of my hobby horses is the question of the Dublin Bay prawns. I see figures have been quoted showing that there has been a drop in our own production in that line. I should like to reserve my right to come back in relation to the amount allowed in from some of the Far Eastern nations. I see there has been a multiplication by almost nine times between 1974 and 1975 in the value of imports of Bangladesh prawns.

Chairman

I am sure the Deputy is also very interested to see that Norwegian lobster are called Dublin Bay prawns.

Deputy Esmonde

I am aware of that.

Chairman

The Deputy is reserving his position.

Deputy Esmonde

I am reserving my position fully on this because these countries could well do with using some of this food for themselves having regard to their protein shortage. I made that point before. I understand it has been noted in some of the Commission's documents.

Paragraphs 11 to 13, inclusive, agreed to.

Chairman

May I take it the draft Report is adopted?

Draft Report, as amended, agreed to.

Ordered: To report accordingly.

Chairman

Thank you, Deputies and Senators for your attendance.