Seanad Éireann debate -
Thursday, 13 May 1982

Vol. 98 No. 1

International Common Fund for Commodities Bill, 1981: Second Stage.

Question proposed: "That the Bill be now read a Second Time".

Minister of State at the Department of Finance (Mr. Barrett,

Clare): The purpose of the Bill is to approve the terms of the agreement establishing the Common Fund for Commodities and to enable this country to honour its financial obligations as a signatory.

The concept of a common fund arose from a very real concern about the manner in which primary commodities are traded. At present the trade is subject to repeated fluctuations of price and supply. These fluctuations not only affect developed countries, including Ireland, which consume the commodities but, most seriously, the fluctuations affect the developing countries. In some cases their entire economies depend completely on the production and export of a few basic crops or raw materials for industries.

Another very important aspect is the need to aid and encourage developing countries to exploit their production capacity more fully through additional processing within their own territories and better approaches to marketing.

With these considerations in mind, the Fourth United Nations Conference on Trade and Development (UNCTAD-IV) adopted an integrated programme for commidities in May 1976. The programme named 18 commodities of particular interest to developing countries. Examples are rubber, cocoa, coffee and tin. It was further agreed at UNCTAD-IV that a Common Fund For Commodities should be a key factor in the integrated programme.

The negotiations which followed resulted in the present agreement, which was adopted in June 1980. Ireland signed the agreement in February 1981.

The Common Fund is designed specifically to tackle the two issues which I have mentioned. It will have a First Account with a resources target of $400 million to be used to facilitate stability of price and supply It will also have a Second Account of $350 million. The First Account will operate by lending money to International Commodity Organisations (ICOs). These are organisations set up to oversee international commodity agreements. It is hoped that establishing a Common Fund will not only help existing ICOs but will facilitate the conclusion of more commodity agreements.

Money borrowed from the fund by ICOs will be used solely for purchasing buffer stocks. The fund will promote the joint financing of such stocks by producers and consumers, a development which will foster greater international economic co-operation. Buffer stocks are used to stabilise price and demand. Stocks are acquired by the ICO when a commodity is in abundant supply to stop the price falling below a floor price which is equitable to both producers and consumers. Alternatively stocks are released onto the market when the commodity is in short supply and the price is beginning to rise above an equitable ceiling. Buffer stocking is a means of preventing or, at the least, curbing disruptive speculation which damages both producers and consumers, and can be particularly damaging to the economies of some of the least developed countries.

The First Account will be financed from directly contributed capital, in other words members' subscriptions to shares in the fund, and also from capital guarantees and cash deposits from ICOs associated with the fund as well as borrowings from the financial markets.

In addition to the First Account, there is, as I mentioned earlier, an amount of $350 million in the Fund's Second Account. The Second Account is designed to assist in research and development of commodity production and marketing and it is hoped that it will encourage developing producer countries to diversify and expand their commodity trading and develop further processing of their commodities rather than relying solely on export in the raw state.

The Second Account is financed by means of an initial allocation of $70 million from the share subscription to the First Account, by additional voluntary contributions from members and by borrowings by the fund on the financial markets.

Membership of the fund is open to all States who are members of the United Nations or of any of its specialised agencies or of the International Atomic Energy Agency. It will be managed by a Governing Council and an Executive Board. Each member state will appoint one governor to the council which will elect 28 executive directors to the board.

The agreement also makes the customary provisions for legal status of the fund, immunities from judicial proceedings, interpretation and arbitration procedures, process of amendment and provision for entry into force.

Ireland's commitments to the fund will consist of $1,000,000 for the purchase of shares in the First Account. The Bill provides a higher ceiling so that we can take up additional shares if additional capital is required. We will also provide a voluntary contribution of $250,000 to the Second Account. Payments will be spread over the two years after entry into force of the agreement. In addition, we will have certain commitments arising out of our membership of ICOs associated with the fund. We make a small annual membership subscription to the ICOs at present. Under this agreement we would also provide guarantees to the Common Fund as part security for borrowings by the ICOs. These guarantees would replace payments that we currently make to ICOs for buffer stocking.

I would like to give Senators a brief example of the importance of commodities in this country. Ireland is a member of the present International Natural Rubber Organisation. It is in our interest to have stability of price and supply. Industries related to this commodity employ 3,300 people in this country. In 1981 we imported over 7,000 tonnes of raw rubber at a cost of around £6 million. Our exports in that year came to 33,000 tonnes of raw and manufactured rubber products which were worth some £52 million.

Before turning to the provisions of the Bill, I would like to draw Senators' attention to an aspect of the Common Fund which I feel to be particularly relevant. We all appreciate the necessity, both moral and practical, of aiding, and cooperating in the development of, Third World countries. The Brandt Report in particular demonstrated the pressing need to assist such countries in a practical, long term way rather than by measures providing only temporary reliefs which must be constantly supplemented, leaving the Third World depending largely on the fickle goodwill of the industrialised nations. There has also been much concern and adverse comment about the misdirection and abuse of aid, where assistance is diverted from its intended recipients or is inequitably distributed. We are hopeful that the Second Account of the Common Fund will do much to improve this situation by aiding projects aimed at improving the structural conditions in market research and development, productivity improvements and processing development. In other words, we are seeking to improve the capacity of developing countries to exploit their own natural resources for the benefit of their economies and their people.

In conclusion I will summarise briefly the provisions of the Bill. Section 1 defines various terms and section 2 provides for approval of the agreement. Section 3 contains the financial provisions for payment of subscriptions for shares in the fund's First Account, and contributions to the Second Account and for borrowing guarantees, required by reason of participation in international commodity organisations associated with the fund. Sections 4 and 5 relate to the disposal of any moneys received under the agreement and to payment of administration expenses. The Schedule contains the text of the agreement.

I commend the Bill for the approval of the House.

Professor Dooge

This is a welcome Bill. It is a Bill which must be looked at not for what is on the face of it but in the general context of the relationship between ourselves and other developed countries and the countries of the developing world. If we do look on the face of the Bill we find that it has a most peculiar face. We have a Bill the text of which is less than two pages in length, accompanied by a Schedule which is 44 pages in length. It makes it a very difficult Bill to discuss and it becomes still more difficult when we find that actually the Schedule has Schedules of its own. Consequently, references become quite difficult. What I propose to do is to talk on the general nature of the Bill on this Stage since it is the appropriate thing to do on the Second Stage and defer until the Committee Stage the discussion of some of the matters that would be more appropriately discussed on the Schedule.

This Bill is part of a larger pattern. The Minister in his opening speech made reference to the Brandt Report. Certainly this Bill is compatible with the Brandt Report and indeed the question of a need to do something on international commodities is mentioned in that report so that the Bill is entirely along these lines. I quote from the Brandt Report on page 271 of the PAN edition of it:——

Earnings from commodities must be strengthened so they can contribute more adequately to the development of Third World countries, most of which are still heavily dependent on primary commodity exports.

It then goes on more importantly to say, and this is a key factor, and I am again quoting:

They should be enabled to process their own raw materials locally and to participate in their international marketing, transport and distribution. Commodity process should be stabilised at a remunerative level to become less vulnerable to market fluctuations.

While this Bill does provide the machinery through the operation of stock buffers in making primary products from developing countries less subject to fluctuation, one wonders whether the Bill as drafted, more particularly whether the agreement as implemented, will in fact go through the Second Account and really tackle these questions of local processing, of transport, of participation in marketing, because if that is not done, then the expenditure under the First Account will be largely wasted. If we think it is merely a matter of buffering, merely a matter of smoothing out fluctuations, we will have a continuance of what we have had over the last two decades: some effort on the part of the developing world but effort of such a nature and to such an extent that in fact the gap between the developing and the developed countries merely continues to grow larger and larger. So what we have here is something which can be considered as a move in the right direction. That something will be entirely powerless to solve the problem unless it is accompanied by many other actions as well.

Before I leave the Brandt Report, it is usually referred to as the report on North-South relations. But the title of the Brandt Report is "North-South: Programme for Survival". And this is what it is, not merely a programme for the survival of the people in the developing countries, though it is a question of survival there, of individual life and death. But the main message of the Brandt Report is that what we are concerned with is survival of our world. It is the dilemma that faces us so often in politics, the choice between reform and revolution.

While we can agree with this Bill we must say that it can be only a part of a larger pattern, a part of a larger effort. As the Minister of State has said in introducing the Bill, it arises from the deliberations of the UN Conference on Trade and Development. That particular organisation — UNCTAD — was created almost 20 years ago. Its objectives were to produce convergence in policies concerning both trade and aid. Its objectives were in matters of trade to produce remunerative, equitable and stable prices for primary products. And yet it takes us 18 years until we can get a simple agreement — I withdraw the word "simple" when I think of the 44 pages of the Schedule — the first agreement which attempts to get the countries of the world together to that objective. The secondary objective established 18 years ago was to ensure access to markets in industrialised countries, to ensure access of finance and of technology in the form which would benefit the developing country not in the form that will develop the country which is exporting its technology.

We can say with regard to this whole effort that the seventies was a decade of much dialogue and of little action. Long ago, at the beginning of that decade at the UNCTAD conference in 1972 in Santiago there was a fund established for special measures to deal with such problems as transport costs for specially disadvantaged developing countries. That problem still remains unsolved. So much so that one begins to wonder if multilateral action is an efficient way of achieving the objectives that have been put forward, often in good faith, so many times for trying to reduce this gap between the developing and the developed by both multilateral and the bilateral means. It seems to me that the record of multilateral action by UN organisations and other international organisations, has not been a good one. We can certainly criticise the developing countries as the Minister of State has said, because in some instances the aid has been diverted and has not reached its original target area or target group in the population. That is not the only case where there has been waste. There has been waste in the organisation of the multilateral agencies themselves. It is not only that when aid arrives in a developing country that it gets diverted in order to suit individuals or the friends of individuals. We have multinational Government agencies which are inefficient because they are staffed by the friends of powerful individuals. Indeed, as a result, their overhead costs are far greater than they would be if they were staffed on merit alone. This is a very serious problem for us because if all the aid which we give—and which we do not grudge in giving to developing countries — we are at the moment giving about two-thirds of this in multilateral aid and only about one-third in bilateral aid over which we ourselves can have more direct control. This is about the reverse of our other partners in the EEC. This is something which we should look at most carefully. The examination of this is something that was initiated in the study which Deputy Jim O'Keeffe initiated in regard to the review of our aid policy and the preparation of a White Paper. I hope that work will be pressed on with and that all of our aid proposals, multilateral and bilateral, will be examined with great care.

What we are asked to approve today is the creation of this particular fund. As has been indicated, this arose from the fourth UNCTAD Conference in Nairobi in 1976. I am afraid that we already see a dilution of what was agreed in Nairobi in 1976. If we look at the actual text of the resolution, and I am quoting from the proceedings of the United Nations Conference on Trade and Development, the fourth session in Nairobi, volume 1, page 7, it gives the objectives of the integrated programme for commodities. We have here seven objectives. The first two of these objectives only are concerned with the question of the actual avoidance of excessive price fluctuations and the question of fluctuations in export earning for developing countries. We have further objectives here set out in great details. For example, No. 5, and I quote:

To improve the competitiveness of, and to encourage research and development on the problems of natural products competing with synthetics and substitutes, and to consider the harmonisation where appropriate, of the production of synthetics and substitutes in developed countries with the supply of natural products produced in developing countries;

Now a shadow only of this objective appears under Account No. 2 in the present legislation. Research and development are still mentioned but the full force of objective No. 5 has been watered down. And equally in regard to objective No. 6 which talks not about marketing but about the improvement of markets structure. Objective No. 7 which talks about improving marketing distribution and transport systems for commodity exports of developing countries, including an increase in their participation in these activities and their earnings from them. I would fear that in fact even though we have had here already six years of attempts to set down and to implement the resolution made in Nairobi in 1976 that we do not have a full implementation of what was agreed there. We have had our organising sessions of the members, over 1,400 of them, all the UN organisations, specialised agencies, various governmental organisations and non-governmental organisations and what comes out in the end is in fact something less than what was intended when the original agreement was made. The details of this agreement are probably better discussed one by one on Committee Stage when talking about the Schedule.

There is one further point I would like to mention at this stage. It is to ask the Minister with regard to the 18 commodities which were taken as being within the scope of the original agreement how many of these is it intended should be the subject of the formation of commodity organisation and the establishment of commodity boards immediately on the coming into force of this agreement? I would like further to ask how many of these will be existing agreements? There are, of course, many existing agreements already. Sugar is one which is giving rise to difficulty in recent times. How many of these will be absorbed into the new organisation and what will be the manner in which the existing organisations will be absorbed? A further question I would like to ask the Minister is whether in fact the agreement has already come into force? Have the required 90 countries ratified the agreement or will there have to be a special vote required because, as I understand it, ratification was required by 31 March this year which has now passed. I would ask the Minister in particular how many countries of the Community have ratified and whether the Community itself intends to become a member, as it is entitled to do as an organisation, in addition to its own individual members.

My main point on Second Stage is that this Bill is certainly one with which we will agree. It is, of course, a Bill which was introduced by the last Government in November 1981. It was totally in harmony with our whole attitude to the question of aid to developing countries. I am glad to see that the Bill has been introduced. I will be gladder still if I find out over time that the approach to aid of the present Government also matches this Bill. Indeed, not only matches the Bill but accepts it not as something which is sufficient to be done but something that is necessary to be done and something to be done as part of a general vigorous approach to this most important problem.

Professor Murphy

My reservations about the Bill are less detailed but more fundamental than those expressed by Senator Dooge. Because I like to think they are more fundamental I suggest that when I outline them it may well explain why the position is unsatisfactory, why the plans whether at multilateral or bilateral level simply never had the success they were intended to have.

This subject is nothing new to us in this House. We had a long discussion on the Brandt Report and at fairly frequent intervals in the context of discussing reports on the European Communities we discussed the relationships between the EEC and the Third World. I think that our assumptions about all this are erroneous.

In the Minister's speech we have a general statement of intent, that the purpose of the Bill is, among other things, the need to aid and encourage developing countries to exploit their production capacity more fully. He refers to the fact that in some cases the entire economies of these countries depend chiefly on the production and export of a few basic crops. We use words such as "developing" and "undeveloped" and related words like "underdeveloped" and of course the "developed nations" and all this terminology I suggest is a piece of self-deception. It suggests that there is a linear spectrum and in one end of the spectrum there are the developed countries which are prosperous and through a range of intermediary stages there are the very poor countries which are under-developed and in between there are developing nations.

The further assumption in all this, whether you approach it bilaterally or multilaterally, is that all the countries along the line belong to the same global community of interest, a vast world fraternity in which the wealthy brothers help out the less fortunate brothers. This is the whole concept between aid and encouraging the underdeveloped nations. The differences of emphasis, in my view, are of relatively minor importance.

What I mean is that we are frequently told that what the so-called underdeveloped countries need is not money but expertise and there are all kinds of homely analogies about not giving them fish but teaching them how to fish and so on. That kind of detail is in my view unimportant because it simply shores up the erroneous assumptions that by aiding the underdeveloped countries, giving them a pat on the back, making encouraging noises, they will in time move progressively along the spectrum towards the developed end.

Really what we should be considering is whether the developed countries develop at the expense of the undeveloped. Is that why they are developed? I believe that it is. I believe that our present hypothesis of developed countries and undeveloped is simply not satisfactory. It is not somehow that the western world came first to industrial revolution and discovered the blessing of technology first and that these other countries are lagging behind but that they will catch up on us. I suggest that there is a more feasible model or hypothesis to explain the North-South imbalance which is so crucial to the world and which is at the heart of the Brandt Report. That hypothesis or model I suggest is that these so-called underdeveloped countries are in a neo-colonial condition.

Before anyone will start saying "jargon" let me assure the House that I am not a doctrinaire Marxist — I am not even sure that I am a socialist — but that does not prevent me from taking from Marxist theory the valuable insights to be found in that ideology. The facts of history, geography and economics make it absolutely indisputable that these unfortunate countries are unfortunate because the West exploited them in their pre-independent days and continues to exploit them in their nominally post-independent days. In all that context the notion of aid is a cosmetic exercise. It is conscience money, and we might lull ourselves into a false sense of security if we believe that it is going to work. It is not going to work.

Let us take some of the other ideas in this Bill. If we consider that poor countries rely, for example, on the export of primary commodities, that their food products are generally unprocessed and that we can somehow do something about this, we should also take into account that they have no real control over world credit or exchange, they have little control over transport in the matter of exports, and in general they are at the mercy of international finance.

Is there a country nearer home which exports its most valuable commodities in an unprocessed condition, which exports and has exported its minerals in an unprocessed state and has been allowed to do so for 15 or 16 years, whose export of cattle on the hoof is an absolute scandal, which has no control over its credit and which is at the mercy of international finance? If there is and you can name it, then you will have to concede that we are a kind of classic neo-colonial country. We act and look and proceed in the international field as if we belonged to the developed countries but we really are not a developed country. We have been historically a colonial country and are still a neo-colonial country. We have a particular interest in all this, not because we have joined with our EEC partners in giving aid but because we have more in common with the countries at the wrong end of the spectrum than we have with the robber barons who have retired perhaps from their robber-barony but whom we now call our partners and whose aid to the Third World has a very poor record indeed. I am, of course, in favour of realising the United Nations target of aid as a certain percentage of the gross national product, but it is ultimately no solution. We must recognise the underlying realities of the world order that really account for the low living standards of the so-called under-developed countries.

Mrs. Bulbulia

A Chathaoirleach, permit me first of all to congratulate you most warmly on your elevation to the Chair of this House. It gives me particular pleasure as one who was inspired to enter politics with the firm belief in and commitment to further the equality of women in society. It gives me enormous pleasure to see you in that chair, and I wish you a most successful term of office.

Permit me also to welcome the Minister of State to this House and to offer him my best wishes for a successful term.

I will now address myself to this Bill which has come before us. Its purpose in giving effect to a proposal from the Fourth United Nations Conference on Trade and Development — UNCTAD-IV — held in Nairobi on May 1976 is to be lauded. Nothing more eloquently testifies to the bureaucracy involved in bringing good ideas such as this to fruition as the fact that it has taken six years to bring this proposal from Nairobi to Dáil Éireann and Seanad Éireann. The prospect of further delay in order to secure further ratification alluded to by Senator Dooge is disturbing. The purpose of the fund is set out on page 1 of the explanatory memorandum. It is designed to achieve stability in commodity prices and markets. Primarily the fund will help international commodity organisations by providing credit to purchase buffer stocks of their particular commodity. The ICOs will buy stocks when the price is falling due to abundant supply, thereby benefiting exporting developing countries. Conversely, the ICOs will sell on the market when prices rise due to a shortage of supply and this will benefit in turn consumer countries. The fund will also provide loans and grants for research and development in the field of commodities, and this will apply mainly to the developing countries.

If this can be achieved in the interests of the Third World it will have been a worthwhile exercise, but I would stress that it is vital that all the actions and decisions of the fund be taken with the interests of the Third World in mind and not merely those of the developed world. From a national budgeting viewpoint support of this venture involves making financial commitments for years ahead, and I am pleased to have heard details of Ireland's financial obligations in the speech which the Minister of State made at the start of this debate. The proposed legislation envisages a situation in which deficits can occur on either or both First and Second Accounts. If this situation arises it will impose further financial resposibilities on the fund's members, and I would ask the Minister of State whether these potential financial burdens have been quantified.

Over and above all the technical minutiae of this worthwhile Bill — and I question whether the drafting of the legislation had to be so complicated; indeed, it is one of the most complicated pieces of legislation that I have seen since I joined this House — the fundamental fact remains that what this legislation is about is commitment and sensitivity to the reality of life as experienced by those people who live in the Third World.

Let me place on the record of this House some very telling facts which point out the necessity of helping and assisting the under-privileged nations. Life expectancy in the Third World is on average 50 years. Here in the west we can expect to live to 70 years. In the Third World there is a doctor for every 9,000 people and a nurse for every 8,700 people. Here we have a doctor for approximately every 630 people and a nurse for every 220 people. In the Third World only 28 per cent of the people have access to clean drinking water. Here there is 100 per cent water availability for our people.

I recognise that there are anomalies in the situation, and it takes courage and commitment to persist in bringing forward the importance and significance of our participation in development aid. Senator Dooge in his contribution has referred to some of the more glaring examples of mismanagement and graft which can occur in Third World situations. It is very easy to become impatient when you see with your own eyes the gigantic mismanagement of some official aid programmes and the prodigious scale on which graft, larceny, indolence, ignorance and sheer incompetence can permeate everything and indeed, at times, the devastating waste. Then there are the more obvious indecencies, and I use that term advisedly. India has its nuclear programme and oil-rich Nigeria has kwashiorkor still rampant in certain areas. Gambia lacks a CAT scanner; inappropriate technology provides colour television, for example, but no running water. The inequalities between the rich and the poor world are becoming even more obvious. For example, even more germane to the International Common Fund for Commodities Bill, in 1965 it cost Tanzania five and a half tons of cotton to buy a tractor. By 1972 an equivalent tractor cost eight tons of cotton. Today that same tractor costs about 30 tons of cotton. Therefore, the poor really do become poorer and it was in an effort to exert some control over that situation that the International Common Fund for Commodities Bill was instituted.

A note of warning must be sounded and we ignore it at our peril. The poor become poorer despite major efforts such as this Bill, but it seems unfair to adopt a negative attitude to it prematurely before the fund has actually been set up. At the end of the first decade of development of the United Nations it was found that of all the new wealth developed over that ten years 80 per cent had gone to the First World and only 6 per cent to the poorest countries.

Here I would like to develop a point made so eloquently by Senator Murphy. Much of the poverty in the Third World has come about by the economic oppression which the rich world exercises over the Third World. This has its roots in the colonial period when trading structures of the colonised countries were shaped to suit the needs of the colonisers. Thus we can account for the importance of jute to the economy of Bangladesh and of tea to Sri Lanka. However, although the colonial period has now ended, many Third World countries remain locked in what is a virtual one-crop situation and the markets for these crops lie in the rich world which effectively dictates prices, and so the cycle of poverty is ensured and continues. The ex-colonies remain producers of basic materials while we in the rich world do the manufacturing which, of course, is where the added-value lies. This International Common Fund for Commodities Bill is a brave attempt to break that cycle of poverty by aiming for stability in commodity prices and markets. We must also face the fact that while we here in Ireland were developing we had access to cheap oil, but, as we all know only too painfully, this is no longer available. The problems which the poorer countries faced 20 years ago have not diminished since. Rather they have increased.

This brings me back to a point which I made earlier in relation to this Bill: that it is vital that all the actions and decisions of the fund be taken with the interests of the Third World in mind and not those of the developed world. It has happened in the past and it still tends to occur that our use of trade agreements and conventions is so designed as to ensure our dominance in the market place. I put it to the House that this attitude is just as shameless as was the naked force used by earlier generations in their exploitation of the riches of the colonies. If we were serious about the Third World we would embrace the principles of a whole new international economic order which proposes to replace aid with trade, the transfer of resources, including technology, to the Third World, a monetary reform which would allow the Third World the security of an international reserve currency which would be used for the benefit of all nations.

This International Common Fund for Commodities Bill represents a step in this direction and, as such, is to be warmly welcomed. However, it must be clearly recognised that we all have a grave responsibility in relation to the Third World and international economic equity both as individual Members and particularly as Members of the Oireachtas and therefore in some way leaders of the communities which we represent. We must expose ourselves to the problem, we must inform ourselves, we must learn and understand, because unless we do we will not generate the political will which is necessary to make the changes that need to be made. Johann Pronk, Deputy Secretary-General of UNCTAD, from whence came this Bill, has spelt out the importance of political will. He said, "We need political will to change, we need knowledge of the issues involved but above all we need a political climate within the West, within which it pays to change".

I must at this point express my own indignation and utter disappointment at the throw-away response of the Taoiseach to a question in the Dáil yesterday from Deputy George Birmingham which was reported in today's daily papers. The Taoiseach referred to the disastrous experience of the previous Government in having a Minister of State there who was quite superfluous and a supernumerary. This, sadly enough, was not followed by any statement of policy or general intent or indeed any commitment on the part of the Taoiseach to pursue with energy and firmness of purpose the Government's bilateral and multilateral aid programmes.

Thinking people everywhere in this country, particularly those concerned with the development aid, welcomed with enthusiasm the appointment of Deputy Jim O'Keeffe as Minister of State at the Department of Foreign Affairs with special responsibility for development co-operation. Deputy O'Keeffe applied himself to his task with enthusiasm and verve and this was recognised by all who have an interest in Third World development aid. I call on the Taoiseach to make a statement of interest and to reaffirm Ireland's commitment in this area and I urge all development agencies to make their voices heard lest there be any diminution of purpose, any complacency or self-satisfaction on the part of the present administration whose record in the past on development co-operation unfortunately has been so weak. I would remind the House that the Coalition Government adopted the UN target of 0.7 per cent of GNP as an overseas development aid target, but more important, they adopted a specific timetable for the attainment of that target by the end of this decade. In addition to this in the 1982 Estimates we in the Coalition provided for an increase in overseas development aid from £18 million in 1981 to £26.335 million in 1982, putting this objective directly on target and rendering it achieveable. I warmly welcome this Bill establishing the international fund for commodities as it recognises that major international initiatives are needed if mankind is to survive. Willie Brandt said in his North-South: `A Programme for Survival' that reshaping worldwide North-South relations had become a crucial commitment to the future of mankind, equal in importance to counteracting the dangers of the arms race. We believe this to be the greatest challenge to mankind in the remainder of this century.

Mr. Hussey

Before I make my few brief remarks on this Bill I would like to congratulate you on your appointment as Cathaoirleach of the Seanad and wish you every success in your very onerous task.

Briefly, I welcome this Bill the purpose of which is to approve the terms of the agreement establishing the common fund for commodities and to enable this country to honour its financial obligations as a signatory. The setting up of the Common Fund such as it is proposed is seen as a means of stabilising the market for the supply of certain commodities. Examples given for these commodities include rubber, cocoa, coffee and tin. The fluctuations experienced in the marketing of these commodities at present are bound to have an adverse effect not only on the developing countries that produce them but also on the developed countries including Ireland. The importance of encouraging developing countries to exploit their own production capacity more fully cannot be over-stressed because too often developed countries honour their commitments to the undeveloped countries by the allocation of financial assistance when in fact they could often provide more valuable assistance to those countries by providing expertise to enable them to exploit their own natural resources. It is important that we help developing countries to improve their economies and the setting up of this fund will do that.

The Minister in his brief indicated that Ireland was at present a member of the International Rubber Organisation. It is in our interest to have stability on price and supply. He also indicated that this industry employs 3,300 people in this country. That is a very important consideration for us at this time, particularly when we have such a high rate of unemployment. We imported 7,000 tons of raw rubber in 1981 at a cost of about £6 million. I was glad to see that our exports in that year amounted to 33,000 tons of raw and manufactured rubber products which were worth £52 million. That clearly indicates the importance of this fund particularly to this country — and I suppose everybody examines the situation in their own country. I am happy to see that the fund has been set up even at this late stage. Ireland's commitment to the fund will consist of £1 million. I understand it is for the purchase of shares in the First Account. I welcome the Bill and hope it will proceed through the House as soon as possible.

Mr. McDonald

First, I should like to congratulate the Cathaoirleach and wish her a pleasant and successful term in office. Also, I take the opportunity to thank the Leader of the House for his kind words earlier this afternoon.

I welcome this Bill to the House and I hope it gets a speedy passage. I have been watching the progress and development of this legislation since the mid-seventies during the period I served on the Executive Committee of the ACP Joint Assembly when it was the major topic of many of the international meetings of that body. Our country should be a signatory to this very important international agreement. It has evoked a tremendous amount of comment, thought and study. At the same time our people must be very clearly aware of what exactly is involved. While I subscribe to this, nevertheless I can see that as large numbers of these countries develop — most of them with philosophies and policies very far removed from the system under which we work — they are going to offer tremendous and very serious competition to our producers in certain of the light industry areas. This is something we must live with and compete against and, at the same time, we must help these people. The difficult problem is accepting that in many of these countries, especially countries who may very well themselves be in famine situations, their order of priority is a long way away from ours. In the past few years one country in particular was spending more on armaments than the Allies spent at any one time during the Second World War and yet that country had millions of people in a situation of acute starvation. We must not look at that kind of a situation but look forward to the common good.

Many people during the course of the preparation of this document looked very closely at the common agricultural policy of the EEC as a guideline for what could be achieved — I do not mean in minute detail but as a general idea of what they were aiming at. This international convention will be of tremendous benefit to the smaller countries, especially the smaller land-locked countries throughout the developing and under-developed world that are solely dependent on one crop. It is important that they should have help and be able to see the benefits of self-help. It is only through assistance such as this that the weaker one-crop economies will be able to get some sort of guarantees and safeguards either against multi-national monopolies or indeed be able to survive against the larger economies that are inclined to dump goods and who do not care about areas that are under severe stress.

I welcome the Bill and I hope it will live up to the ideals and the aspirations of the people who worked so hard over so many years to draft this and bring it to fruition.

Mrs. Barnes

May I join with the other Members who have already given you our best wishes and congratulations and wish you a very fruitful chairmanship. I hope that this forum will be fruitful and exciting from the point of view of discussing legislation.

I agree with much of what has been said but I could not allow a Bill and an issue of such importance to go through without commenting on it. Some years ago I read a sentence that burned in my brain. It was from a report on the work of development in the Third World. It was stark, simple and true. It said: rich countries are rich because the poor countries are poor. We know it was the exploitation and the ripping-off of the natural resources and the people of those countries that kept them poor and helped to make the developed world rich and still helps to make it rich.

Enough cannot be said about the Brandt Report. It highlighted what we owe in conscience, not in charity, to the countries who have been allowed to remain poor, underdeveloped and exploited, and it also warned that if the more developed countries do not take this seriously, do not out of their own development and technology contribute now to these countries, there will be a violence within those countries that the North can look out for. At the most practical and selfish level this Bill goes part of the way towards what we should go doing. I hope we will have further discussion on it. This country, as Senator Murphy and others have said, has a special and unique position in so far as we are a member of the EEC which is the richest bloc in the world. However, we remain on the periphery in so far as we can be seen in EEC terms to be a developing country.

All of us here share a collective folk memory of the damage that was done to us as a country by our power being removed, by the fact that for centuries we were not allowed to use our resources properly but had to export them to a country or countries who would make use of and profit from them. Let us not misuse that experience. It has taken us long enough to come out of it ourselves; as Senator Murphy said, we have not accomplished what we should have done.

Senator McDonald referred to the fear of competition from the developing countries. Let us think about it in a positive way and let us try to use our technology for our resources. We ourselves know — and Senator Murphy made reference to it — that we are not developing our own natural resources to the extent we can and should. Then, in turn, we will be able to allow the countries who have their own natural resources to keep them, process them, develop them and so, in fact, to build up their own economies That is what the need for aid and development is about, not hand-outs.

There is a very grave concern among people who are working in the developing world that we will impose our technology, our thinking and our ideas of success and richness on people in those countries. There is the obscenity to which reference has been made, of having armaments and tanks in deserts where there is no irrigation. As a country we contribute funds but we should make sure that in extending aid we do not rob the people of their traditional ways and their own independence. Instead, we should add to and enrich that.

I am particularly concerned about this in so far as to a great extent many of the traditional crafts and skills that are within the country, but not technologically progressed yet, are and have been done in small villages and communities and particularly by the women there. When we start development work we are inclined to impose on them a new order, a new tradition that can impoverish them, spiritually and emotionally. For women, it can deny them the small share of economic independence they had before. I ask the Minister to ensure that we continue the programme that has been started by the Coalition Government, and particularly by the former Minister of State, Deputy O'Keeffe. We should realise it is not just a matter of hand-outs. We may have problems in Ireland but we should not forget we are still the 26th richest country in the world. When I was growing up it was a question of giving a penny for the black babies. In the global village in which we live we should allow the family next to us to develop in their own way. We should help them with our resources but leave them their independence. That programme, accompanied with our increased aid, would I hope also help to bring about an end to rockets in the desert and armaments on the dry, sandy wastes of more than half of the world.

Minister of State at the Department of Finance (Mr. Barrett,

Clare): First, I would like to take this opportunity to congratulate you on your election to the Chair. I wish you a very successful and long stay in the post. I wish also to thank Senator Bulbulia for her kind remarks and good wishes to me.

There is very little controversy as far as I can gather about this Bill. We are all agreed that it is worthwhile and worthy of support, but a few questions were asked which I would like to answer.

One question was with regard to what commodities were involved. The fund is available for any of the commodities for which there is an international commodity agreement. The core commodities are coffee, cocoa, tea, sugar, cotton, rubber, jute, sisal, copper and tin. The principal existing commodity agreements relate to cocoa, coffee, tea, sugar, wheat, rubber and tin. Any of these commodities, as well as additional commodities, are welcome to avail of the fund. Much will depend on their existing financial arrangements; for example, the International Sugar Association was mentioned. They have said that they might get along without the fund and that is their view. With regard to the question of whether potential burdens over and above those provided for have been quantified, the answer is no. The agreement provides for reviews of resources. In so far as we in Ireland are concerned, the Bill places a ceiling on our share of contributions. Any guarantees which may have to be given will have to come before both Houses of the Oireachtas for approval.

The question of when the point of entry comes into force was raised. At the moment only 26 counties have ratified the agreement. Of these two are members of the EEC namely, Ireland and the United Kingdom. Those who have ratified the agreement will meet this month to discuss extending the date of participation. They will, in all probalility, extend the date from 31 March 1982 to 31 December 1983 in order to ensure that by that later date there will be an increase in the number of ratifications. So far, many countries have been dragging their feet about the ratification. They were the principal points which were raised and I have endeavoured to answer them.

Senator Barnes spoke about helping people with our own technology and so forth rather than in the form of hand-outs. We have been doing that in other fields. From my own experience I know that Foras Forbartha and the ESB have been giving the benefit of their know-how and technology to some of these countries, and one in particular which you would describe as a desert country has been helped with regard to water and sewerage schemes. That has been going on for some time by some State agencies.

As has been said, it is a start. As Senator Dooge knows from his own experience, there is much talk at the conferences which take place before the agreement is agreed to about the desire to help all these nations we have been talking about. Some nations are very loud in expressing their wishes and desires and so on, but when it comes to putting up the money many of them do not put their money where their mouths have been in the past. This has been the experience as far as I know but I hope it will improve. I hope that most of the money involved in this agreement, as in other agreements, will not get lost on the way from its source to the people who are supposed to benefit from it. This has been happening in the past with big international agencies: whether in administration or in other areas, a big percentage of the money gets lost or wasted and the amount we would like does not find its way to the people who are really in need.

It should also be said that we in the western world through all these agencies were very good at creating big cumbersome bureaucracies, but it must also be said that the Third World countries are quite adept at doing that also. It should not have to happen to an administrative agency such as this.

I thank the Senators for their contributions. I will convey the points they have raised because they have been very worthwhile.

Question put and agreed to.

Agreed to take remaining Stages today.