International Cocoa Agreement, 1980: Motion.

Minister for the Environment (Mr. R. Burke)

I move:

That Dáil Éireann approves the terms if the International Cocoa Agreement, 1980, which has been laid before the Dáil.

Dáil approval of the terms of this agreement is necessary in accordance with Article 29.5.2º of the Constitution which stipulates that: "The State shall not be bound by an international agreement involving a charge upon public funds unless the terms of the agreement shall have been approved by Dáil Éireann". An explanatory memorandum has been prepared and circulated to Deputies. This outlines the provision of the agreement and covers the question of the costs of Irish Participation.

The International Cocoa Agreement, 1980, was concluded under the auspices of the United Nations Conference on Trade and Development (UNCTAD) at the United Nations Conference on Cocoa held in Geneva in November 1980. It was open for signature at United Nations Headquarters until 31 March 1981 by parties to the International Cocoa Agreement, 1975, and Governments invited to the United Nations Conference on Cocoa. Following a decision of the Council of the European Economic Community on 30 March 1981 to the effect 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, Ireland signed the agreement on 31 March, along with the nine other member states and the Commission, on behalf of the Community. Instruments of ratification, acceptance or approval must be deposited with the Secretary General of the United Nations not later than 31 May 1981.

Some 98 countries, including Ireland, representing 48 exporting countries and 50 importing countries, participated in the conference. The International Cocoa Agreement, 1980, which replaced the (Second) International Cocoa Agreement, 1975, will remain in force for a period of three years and may be extended for a further period of two years. This agreement will make a valuable contribution to the on-going debate on economic relationships between the developed and the developing countries. The agreement establishes the International Cocoa Organisation to administer its provisions and supervise its operations. The organisation will function though the International Cocoa Council, an executive committee, an executive director and staff.

The main objectives of this Agreement are to achieve a balanced growth between supply and demand for cocoa and to stabilise conditions in the trade by avoiding excessive price fluctuations. For the purpose of achieving these objectives an international buffer stock consisting of 250,000 tonnes will be established. The council of the organisation will appoint a buffer stock manager and he will offer to buy and sell cocoa in a manner designed to keep its price within an agreed price range. The buffer stock will be financed by way of a levy of one United States cent per lb on cocoa beans and proportionately on cocoa products, payable on first export by a member or on first import by a member. In addition, the funds accumulated under the two previous agreements, of the order of U.S. £230 million, are due to be transferred to the buffer stock account established under this agreement.

The administrative expenses of the Cocoa Organisation in its operation of the agreement shall be met by annual contributions by members. 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. However, based on experience of previous agreements, Ireland's annual contribution is estimated to be of the order of £6,000. The agreement will help stabilise raw material prices for a significant Irish industry. The Irish cocoa processing industry provides employment for 2,000 persons. In 1979, Ireland's exports of processed cocoa products amounted to £45 million.

Membership of the International Cocoa Agreement, 1980, will afford Ireland the opportunity to demonstrate its readiness to support international measures to stabilise primary commodity prices and to re-affirm the importance which it attaches to eliminating the economic imbalance between developed and developing countries.

Mr. O'Keeffe

I support the agreement but, bearing in mind the Taoiseach's comments about the heavy legislative programme that needed to be put through the House expenditiously, it is relevant to comment that immediately he followed that up with a motion seeking approval of an international cocoa agreement. That cast some doubts about the seriousness of his comments. The agreement has to be approved by the House within two months of 31 March but now we are being asked to approve it only one week after that date. Whether there is any relevance to the fact that the agreement is being put before the House for approval only a few days after signature, I am not sure. I would have hoped that the Minister would have outlined the situation in relation to the agreement in a little more detail. The first International Cocoa Agreement was reached in 1972. I do not think it is correct to say that the 1980 agreement establishes the International Cocoa Organisation. That organisation was established, in fact, under the 1972 Agreement, which was put into effect after very difficult negotiations over a 16 year period. Those negotiations took place under the auspices of the United Nations and resulted in the 1972 Agreement. The headquarters of the organisation were established in London.

I would have hoped that the Minister would have indicated to the House in more detail the need for this new agreement. There was another agreement in 1975 and the Minister should have informed the House of the difference between the former agreements and the latest one. I accept that the agreement is an important one in the context of the international cocoa trade because, hopefully, as a result of this coming together between the producer and importing countries, more effective measures will be taken to achieve the main objectives of the agreement. Problems and economic difficulties arise, particularly for the producer countries, because of the fluctuations in price. Under the 1980 agreement there was an arrangement whereby a buffer stock would be orgainsed. I should like to know how successful that has been in the past, the changes that have taken place since it was introduced and the extent that those changes will alleviate the problems in the world market. I understand that, arising out of the 1972 agreement, a large part of it was rendered inoperative because of fluctuations in the world market. Obviously, we do not have a major voice in the finalisation of the agreement because we only import to the tune of ½ per cent of world production. But, as the Minister rightly pointed out, the Irish cocoa processing industry is significant in the context of our relatively small economy and in the context of the number of people employed and of our exports.

I should like to ask the Minister to tell us in more detail, when he is replying, how he expects this agreement to affect our cocoa industry. I appreciate that the stabilisation of raw material prices will have an effect, but the Minister should indicate how he envisages the agreement will be of assistance to the Irish cocoa industry in the years ahead. My view is that we should be prepared and ready to support international measures where they are of importance economically to the country and where such measures can be of assistance to Third World countries. Hopefully, the agreement will achieve both objectives and from that point of view, once the terms of it have been teased out, it will have our wholehearted support.

Many of the major producing countries are Third World countries and cocoa production and exports are a major part in their economy. Obviously it is of great importance to them that they have an ordered world market and it would be of benefit for the countries involved to be able to make provision for the future. Therefore it is important that there should be order in relation to supplies and prices in the years ahead. We support the motion generally and hope it will achieve the desired aim of helping the Third World countries involved in cocoa production and at the same time be of assistance to the cocoa processing industry here.

Mr. Quinn

The Labour Party welcome the promptness of the Government in bringing forward this agreement. Perhaps it will be considered that it was brought forward for reasons of convenience, such as that we might not be back after Easter, but it could have a more benign and positive dimension to it, one that I should like to see this country adopt, that is, that we should clearly indicate that we are in favour of such measures, embodying the whole context of trade activities. If this country is to maintain a policy of positive neutrality — it should be the policy of the Department of Foreign Affairs—then active participation in agreements like this, irrespective of the size of our economy, followed up by lobbying for their immediate or early ratification, is the type of thing we should be doing as full members of the EEC, the world's largest trading bloc.

However, we must do this in such a way that the Group of 77 and the UNCTAD will be aware of the actions we take and will value the sort of contribution we can make in terms of a policy of positive neutrality as a link between the rich northern countries of the globe and the poorer southern countries. Because of our colonial past, we have a unique position in this and my regret is that since joining the EEC under this administration and to a lesser degree under the last, we had to jettison much of the moral authority we had in the UN in return for the very dubious honour of participating in the European Political co-operation process.

In his speech—I take it the Minister for the Environment was facilitating his colleague in Foreign Affairs and the House in moving this—the Minister stated that this agreement will make a valuable contribution to the on-going debate on economic relationships between the developed and the developing countries. I am sure it will, but this is a debate in which this Government and the Minister for Foreign Affairs have been remarkably silent. Whatever the value of the debate or its lack of value, since 1977 the value of our bilateral aid, if it is to be taken as a measures of how seriously this Fianna Fáil republican ex-colonialist regime regard themselves, has been a clear indication of how much they have down-graded the significance of bilateral aid and, by extension, the whole question of contributing seriously to North-South dialogue.

It is rather sad to learn that the Advisory Council on Development Co-operation, set up about a year ago, have at last succeeded in getting offices in Fitzwilliam Square but have not yet properly or formally met the Minister. The chairperson of that organisation last week said they were hoping to have their first formal meeting with the Minister a year after being established. This is the council the Government were agonising over, after Deputy O'Kennedy's accession to Foreign Affairs in 1977, as to whether they would have a council or a semi-State body.

We accept that this agreement, for which the Government can take very little credit, will make a valuable contribution to the continuing debate on economic relationships between the developed and the developing countries.

However, it is to our shame that we participate so sparsely in that debate and that our contribution, in moral and effective political terms, has been so underutilised.

Our contribution in this agreement will cost us money and will cost the manufacturers and the food processing people here a certain amount of money by way of levy. The assessment is approximately £6.000. At the moment £6,000 is neither here nor there because of the way the Book of Estimates is being drawn up or guessed, and it is certainly neither here nor there in terms of the amount of disability benefits that seem to go missing, but it is significant, and it could be more. It is a model of the type of agreement that is essential if the post-colonial exploitation of Africa and to a lesser extent Latin America, but particularly primary commodity producing countries, is to be broken, if those nations are to break the economic link with their former colonial masters.

It is not much solace or consolation for independent African States that they now have their own flags flying over parliament buildings, that they now have their own armies instead of foreign ones, if their economies are still totally dominated by commodity markets in Paris, London or New York which can juggle their economic progress one way or another. It is important that the House realises what has happened on numerous occasions in regard to African or Central American countries, artificial situations created by European or American colonialist powers. Because of the total commitment of an African country to a single primary product for export, post-colonial powers have had the commodity market artificially manipulated to such an extent that economic chaos was brought about in the home country. There was destabilisation, to use the neat Henry Kissinger phrase which he applied to Chile which required destabilisation by the US Government because the copper interests of ITT and Anaconda were somewhat under threat. It is highly reminiscent of the kind of economic relationship this country once had with Britain.

I make these points because that is the political context in which these tortuous agreements eventually wind their way on to the floor of this Parliment and the other European Parliaments. In agreeing to the technicalities and the levies and charges that will occur — even having regard to the fact that in real terms the amount is not great — they are an essential part of the historical process of breaking the exploitative link between the colonial part of the world and the colonies part.

This country has got to make up its mind on what side we choose to stand in relation to that debate. It is my regret, and the regret of my party, that this particular republican administration, more of the Reagan kind than any other, has seen fit to drift further and further away from the memory of our own colonialist past and not pursue with vigour and intent the kind of agreement that is embodied in this in other aspects of the North-South dialogue so that not only would this agreement be seen as making a valuable contribution to the ongoing debate of economic relationships between the developed and the developing countries, but Ireland's independent, positive, neutral foreign policy would also be seen as making a similar contribution.

Minister for the Environment (Mr. R. Burke)

I appreciate the welcome which has been given to the agreement by Members on the other side of the House. I regret that Deputy O'Keeffe, in his opening snide remarks, appeared to display a total lack of concern for the developing nations in his attempts and his desire to label the introduction of this agreements within seven days of it having been signed by this Government into the House. I appreciate the fact that Deputy Quinn took the view that there was no ulterior motive, it was for benign reasons that the Government in its concern for the development of the North-South dialogue introduced the legislation.

The motion is before the House because of the efficient order of business which has been a hallmark of this administration. I also regret Deputy O'Keeffe's snide remarks when one realises that we are talking about an agreement involving a primary product which involves 2,000 jobs here. Processed cocoa products involve £45 million worth of exports from this country. Deputy O'Keeffe seems to be totally unaware of the fact that the previous agreement had lapsed. That is why the new agreement involves the setting up of an international cocoa organisation, the council, the executive committee and the executive director of staff.

The Deputy asked for some details of the agreement. The main aims of the agreement are to alleviate serious economic difficulties which would persist if adjustment between the production and consumption of cocoa cannot be effected by normal market forces alone as rapidly as circumstances require, to prevent excessive fluctuations in the price of cocoa, to make agreements which will help stabilise and increase the earnings from the exports of cocoa-producing members countries, to ensure adequate supplies at reasonable prices equitable to producers and consumers and to facilitate expansion of consumption, and, if necessary, in so far as possible, an adjustment of production so as to secure an equilibrium in the long term between supply and demand.

On the question of benefit to Ireland from this agreement, the aim of preventing excessive fluctuation in price is very important. The overall achievement of steady growth in the market would be of benefit to the Irish cocoa industry which imports about £11 million worth of cocoa beans and paste annually.

With regard to Ireland's role within the European Community generally, Deputy Quinn cast some doubts as to the part that this administration has played in the Community, in particular in the area of the development of the North-South dialogue. I wish to remind the Deputy that this administration, as in the previous administration, in our presidency of the Community signed on behalf of the other members the Lome agreement. I can assure the Deputy that the Government are totally committed to seeing a proper, equitable sharing of the world's wealth between the northern and southern hemispheres. We have no difficulty whatsoever in deciding, as a Government, which side we are on in the North-South dialogue. We are there as members of the European Community influencing the policies of the European Community because we have a very special place within the Community because of our lack of an empire. We can play a very important role in the Community. Our country is held in very special regard as can be seen by the honour which, in our bestowed on us in the signing of the Lome 2 agreement, an agreement which, in our presidency, we brought to finality because of our independent stand.

Mr. Quinn

Is the Minister suggesting we were given that option specifically or that it came by chance?

Mr. R. Burke

I did not interrupt the Deputy. If he does not like my speech he may leave. I agree with Deputy Quinn it is very important that what is being achieved in the cocoa sector is also extended to other primary products. In this way, the Community, being the largest trading bloc in the world, would be in a position to help to stabilise the economies and to improve the development chances of the less well-off nations. I assure the House that, as far as this republican Government are concerned, we have no difficulty whatsoever in playing a very important role or identifying that important role within the Community. It is a role we have consistently played since we were elected, to direct the European Community to help the less well-off around the world. This has been a tradition of our missionaries, of our Government and, while we are in office, it will be one of the hallmarks of our administration.

Mr. Quinn

May I ask the Minister a question?

An Leas-Cheann Comhairle

The Deputy may ask brief question.

Mr. Quinn

I welcome the Minister speaking for the Department of Foreign Affairs and his assertion about lack of difficulty in clarifying the republican independence of the Government. Does that extend to ensuring that no representative of Bord Fáilte will attend a conference in Johannesburg in the next couple of months?

Dáil Éireann díospóireacht - Thursday, 9 Apr 1981

International Cocoa Agreement, 1980: Motion.

Dáil Éireann díospóireacht -
Thursday, 9 Apr 1981