I wish to share my time with Deputy Theresa Ahearn.
Private Members' Business. - Uruguay Round: Motion (Resumed).
The following motion was moved by Deputy Dukes on 16 November 1993:
That Dáil Éireann recognises the need for an equitable and comprehensive world trade agreement but refuses to accept the agricultural provisions of the emerging Uruguay Round agreement on the grounds that they impose excessively onerous and unbalanced restrictions and obligations on the EC and are inconsistent with the principle of equality of treatment of all partners.
Debate resumed on the following amendment:
To delete all words after "That" and substitute the following:
"Dáil Éireann approves of Government policy towards the early conclusion of a global and balanced Uruguay Round Agreement which takes account of the concerns that Ireland has expressed, particularly in relation to agriculture."
—(Minister for Tourism and Trade.)
Is that agreed? Agreed.
It appears this Government does not have the commitment I would expect to our largest industry. I am glad to see that the Minister of State at the Department of Agriculture, Food and Foresty, Deputy Hyland is present because it is very important that agriculture is accepted as a most important issue. The 4½ per cent reduction in the milk quota has meant that thousands of jobs have been lost at farm, factory and export level. There is a possible further loss of 2 per cent under GATT and this will mean that more people will join the dole queue. In addition there will be further curtailments of the beef, cereals and other food sectors. We can expect a great many more to become unemployed unless major efforts are made.
Last night the Minister for Tourism and Trade, Deputy McCreevy, said there were positive aspects to GATT and that it was extremely important that the GATT be brought to a conclusion as soon as possible. He highlighted the textile industry as a major sector that would benefit from GATT. What textile industry is left after the activities of this Government? The length of time it took the Government to solve the currency crisis, in addition the imposition of VAT at 21 per cent, put many textile factories under such pressure that they have gone out of business. They now expect GATT to bring that industry back to life. The Minister said also that the growth of the service industry would be of enormous benefit and continued: "For all sorts of reasons, statistical and otherwise, it is extremely difficult to quantify precisely the economic gains that might arise from the establishment of multilateral disciplines in services." We must remember that agriculture is still our most important industry. Since our entry to the EC farmers have proved they can produce and have increased productivity, although the numbers on the land have decreased. We cannot afford to lose any more from the land. We have failed dismally to market our produce and to develop the processing sector. We could do a great deal in this area. If we accept the GATT proposals the processing industry will be destroyed. I ask the Minister to bring a clear message to the Minister for Agriculture, Food and Foresty, Deputy Joe Walsh and the Taoiseach that we must make a last ditch effort to change the GATT, not just for the sake of agriculture but for all our sakes.
I am disappointed that the Taoiseach and the various Ministers have not had a higher profile in this area. I conceded last night they made some effort since January when Commissioner MacSharry resigned but in his period of office they allowed so much to happen that they have a great deal of ground to make up. I believe the GATT will have serious consequences for the country. Some of the points made by Deputy Dukes and the farm organisations last spring on the effects of Common Agricultural Policy reform have been proved wrong but only because of what has happened in Eastern Europe. The eastern European farmers dumped their cattle in East Germany and now there are fewer calves coming from eastern Europe which gives us the opportunity to market our cattle in Egypt, and Libya. We have one last chance in the few remaining days and I appeal to the Minister of State to ask the Minister for Agriculture, Food and Forestry and the Taoiseach to do something about it.
It is unfortunate that the GATT negotiation process has slowed down while the world waits for the US House of Representatives to vote on the North American Free Trade Agreement on November 17. It can be taken that the United States is dictating the trend of GATT negotiations by talking first to several of its main trading partners, including Japan, in an effort to see how far it will push the GATT talks. We are facing an economic war when large countries will compete on the same basis of economy of scale to the detriment of small countries such as Ireland.
The European Community is being placed gradually in a very weak negotiating position, principally by its inaction and failure to be assertive and to take the initiative. For instance at the last EC meeting, rather than setting out the priorites for GATT much of the time was spent discussing issues such as where to locate the European Monetary Fund, deciding to proceed with economic and monetary union by 1999 and reaffirming that the European Community should abide by the Maastricht Treaty guidelines. Why was the important issue of GATT ignored. Where was the Irish Minister? The plain fact is that the trend in these negotiations has been dictated by the United States, the EC, especially Ireland, has been extraordinarily inactive.
It is essential for Ireland to get its priorities right, to assess in detail the benefits and the negative aspects of the issue as it now stands. The experts tell us that these proposals will benefit Ireland because of the boost in world trade. Growth is likely to follow the success and completion of the Uruguay Round. However, how sure we are that our industrial sector will survive and prosper in a free market when barriers to trade are gradually removed? Is the Government being fooled on the benefits of free trade? Perhaps some of our larger industries will prosper but what about our smaller indigenous industries? I feel there will be little chance for them. Small firms are struggling to survive so how can they hope to compete when competition becomes hotter? While there may be some benefits in terms of a more competitive environment Ireland's experience of competition has always been job losses with more people out of work. People should ask what effect the GATT will have on their jobs and how many jobs will be lost compared with the number gained. How can the Government ensure that we as a peripheral nation can compete effectively? True, prices may drop and competition will become fierce. The amalgamation of existing large firms will result in job losses, in some cases the loss of a particular industry altogether.
This motion deals with the agricultural sector and Ireland was wrong to join France on this issue. It would have been far better to negotiate our own needs. The importance of agriculture to Ireland can be well argued and the case stands on its merits, but my main concern is for the beef industry. The importance of the beef industry with regard to exports and employment is well known. Beef is 11 times more important to the Irish economy than to the overall EC. Only 12 per cent of Irish beef is consumed here which means that nine out of every ten animals are exported. These net exporting regions are vulnerable to market oversupplies. Ireland has a very high degree of dependency on beef exports to non-EC countries. This country accounts for 6.6 per cent of the total EC production, yet Ireland accounts for 24 per cent of EC beef exports. Therefore, Ireland is very vulnerable to the proposed export refund costs.
There are two main concerns when considering the GATT negotiations — a cutback in production and a further drop in beef prices beyond the existing CAP measures. The real cause of the agricultural problem is that factory type farming is practised in the US and in some EC countries. It is essential that our negotiators get this point across and place more emphasis on the family farm and on people.
The principle of GATT should not go beyond CAP reform as already agreed. Limitations or cutbacks in production are difficult, if not impossible, to justify in our case. Compensation should be paid if production is limited or cut back. Suckler cow and milk quota cutbacks should not be tolerated and while the GATT agreement emphasises free trade, resulting in lower prices, it will hit some industries very badly. From our point of view the emphasis must be on the importance of agriculutre to our economy. The potential for job losses in native firms must be considered and we must strongly resist further cuts. We must also take into consideration the effects of the present proposals on the rural areas and on unemployment. The effect will be disastrous if the agricultural industry goes into decay. I agree with the point by Deputy Dukes that the GATT proposals as they stand are a one way ticket to oblivion and decay for rural Ireland.
I fully support the amendment to Deputy Duke's motion proposed last night by the Minister for Tourism and Trade. The Minister clearly outlined the Government's approach to the overall negotiations including the agricultural aspects and this House should endorse that strategy. It is opportune for the House to address this issue given the proximity of the deadline for concluding the negotiations and the potentially far reaching impact which a success or failure will have for the world economy and the multilateral trading system in the medium term at least. There have already been a number of discussions in this House on the Uruguay Round in the last few years. Thus, as Members will be familiar with the background to and the negotiating history of the round, I do not propose to dwell on those aspects tonight. Nevertheless, it would be useful to briefly recall the key elements of these long running negotiations.
The negotiations commenced in 1986 and were scheduled to conclude in 1990. There are 15 subjects in the round including a number of areas such as services and intellectual property rights which are to be brought within the GATT rules and disciplines for the first time. It is also envisaged that agriculture would be dealt with in a far more comprehensive way than in earlier rounds. Notwithstanding the media focus, the agriculture aspects have not been the only or the most difficult elements of the negotiations. The Minister, Deputy McCreevy, referred to a number of areas where significant difficulties have yet to be resolved. Thus, it is by no means certain that resolution of the outstanding agriculture problems would automatically result in the completion of a comprehensive and substantive overall GATT deal. Nevertheless, it is almost certainly the case that without an agreement on agriculture the round will not be completed.
It is well known that the major contracting parties have undertaken to seek to finalise the negotiations by 15 December next. There have, of course, been earlier deadlines for concluding the round and the failures to meet these did not lead to any noticeable deterioration in the world trading system. However, it does not follow that that would be the case if there is a further failure.
Even though fewer than 30 days remain before the deadline, it is still not possible to predict whether the negotiations will be concluded. Apart from agriculture, there are continuing and significant obstacles to be overcome in a number of important areas such as market access for industrial goods and services. Intensive negotiations are scheduled to continue over the next few weeks in a final effort to overcome the remaining difficulties and to conclude what would be the most comprehensive trade package ever.
In this regard and while it is a separate negotiation, the outcome of the vote in the US House of Representative later today on the NAFTA could have a decisive bearing on whether the US Administration will be able to complete the Uruguay Round. A positive vote would probably increase the prospects of there being a GATT deal, while a negative vote would make it far more difficult, if not impossible, to conclude the round.
It is not, of course, possible to predict what would happen if the Uruguay Round cannot be concluded by 15 December. Notwithstanding the passing of earlier deadlines, there were no immediate adverse consequences for trade; but if the deadline were to be missed again, there is a serious risk that there would be damaging consequences for the world economy and for the multilateral trading system in the longer term. The Minister, Deputy McCreevy, outlined why we have a strong interest in the creation and maintenance of a stable, well-regulated liberal world trading environment. He also addressed what might follow a failure in the negotiations. I agree with the Minister and add that there is also a risk that some contracting parties could refer our support and other arrangements to GATT for arbitration. On the other hand, a successful comprehensive and balanced conclusion could revitalise the world economy and strengthen the multilateral trading system, thereby securing a degree of certainty for our support and protection regimes.
That, of course, is not to suggest that we should be or are prepared to accept a GATT deal at any price. We have always emphasised that any GATT outcome must be comprehensive and balanced and not impose a disproportionate burden on any country or sector.
As regards agriculture, the current outline agreement is based on proposals made by the then Director-General of the GATT in December 1991 which were subsequently modified by the Blair House Agreement reached by the Commission and US negotiators in November 1992. The essential elements of the agreement which would cover a six year period beginning in 1995 are: domestic supports other than CAP reform compensatory payments and similar payments would be reduced by 20 per cent; border measures such as variable levies would be converted to tariff equivalents which would then be reduced by 36 per cent; minimum access commitments of up to 5 per cent of domestic consumption would be provided for and current access would be maintained; average 1986-90 subsidised exports would be reduced by 36 per cent in budgetary terms and by 21 per cent in volume terms with volumes falling to the 1986-90 average less 3.5 per cent in the first year; the Commission has agreed that existing limitations on exports to South East Asia would be continued; and a "peace clause" which the Commission claim would protect the CAP system from challenge.
The draft agreement has not yet been put to the Council and as such has not been endorsed by the Community. It has not been accepted by the US Senate or Congress or by the other contracting parties.
The House will be well aware that we have major concerns with what has been proposed for agriculture, and that we have outlined these from the outset. Deputy Dukes suggested that these concerns are of recent origin and in particular that the Minister for Agriculture, Food and Forestry welcomed the deal on the day it was signed. That is untrue. In this regard, I draw Deputy Dukes's attention to the statement which the Minister issued on 20 November last, the day that the Blair House agreement was concluded. That statement included the following:
He remained very concerned at the outcome in regard to volume limitations on subsidised exports, particularly in so far as they will affect the beef and dairy sectors. He will need to be clear that these can be accommodated within the CAP reform arrangements before there can be any question of his acceptance of the agreement in the Agricultural Council,
I could point to other statements made, including statements to this House, where the Minister consistently referred to similar concerns. I hope that Deputy Dukes will not continue to use selective quotations to misrepresent the position.
I will do better, I will use quotations to show the mess the Government has made of it.
All Ministers have continued to voice concerns at appropriate opportunities in all the relevant fora. Our main difficulty with the agreement relates to the proposed commitment to reduce the volume of subsidised exports by 21 per cent, the timescale for applying this, the absence of arrangements to deal with intervention stocks and the continuation of the restriction on subsidised exports to South East Asia. We also have other difficulties with the draft agreement including aspects such as the scope and duration of the peace clause and the need to ensure that the Community's approach to market access, particularly aggregation, is fully secured in any final agreement. There are, of course, positive elements in the draft, in particular the exemption from GATT disciplines of CAP reform compensation and the safeguarding of Community support arrangements from GATT challenges. The Commission has also given specific assurances that it has agreed with the US that disadvantaged areas payments would be exempt from the support reduction commitment. We need to ensure that this understanding is legally underpinned in any final agreement.
It remains our view that the current proposed commitments would create difficulties for Community and Irish agriculture in a number of sectors, particularly in the beef sector, where exports would have to be reduced substantially in the first year of an agreement compared to the average levels for 1991 and 1992, but probably not compared to the likely export figures for 1993. There could also be difficulties, although on a smaller scale, in the dairy, pigmeat and poultry sectors. It is not possible to quantify the impact of the commitments for individual sectors or economies at this stage.
In this connection, the position is that any commitments would be undertaken at the level of the Community. It would then be a matter for the Community to consider whether the commitments could be contained within the present CAP regimes or whether adjustments to internal arrangements would be required to fulfil the undertakings. The latter possibility was foreseen when the Community made its offer on agriculture in November 1990. At that time, the Council gave an explicit undertaking that in implementing a GATT agreement, any adjustments would be shared out equitably and that account would be taken of the particular difficulties of certain categories of farmers and regions. We will rely on this undertaking and the relevant provisions of the Treaty of Rome on economic and social cohesion in negotiations on any proposals to the Council on a final GATT deal.
Thus, until we know the outcome of the ongoing discussions in the GATT, until the Council decides whether further adjustments are required and, if so, how such adjustments would be applied, it is not possible to give a realistic assessment of a GATT deal on sectors or economies.
As I said earlier, the House can be assured that the Government has taken every opportunity, bilaterally and multilaterally, to raise our concerns in all the relevant fora. There was an extensive debate on the agriculture aspects at the Joint General Affairs/Agriculture Council on 20 September 1993 when the Council re-examined the compatibility of the draft agreement with the CAP in the light of the Commission's acceptance that some circumstances had changed. Ireland and France expressed serious reservations on the agreement while various other delegations raised specific points of interest to them. Issues raised included the peace and safeguard clauses, the timing and phasing of commitments, disposal of intervention stocks, aggregation, growth of world markets and cereal substitutes imports. In its conclusions, the Council confirmed that the Community will ensure that its international engagements are compatible with the CAP and that the result of the Uruguay Round for agriculture will not either directly or indirectly jeopardise the durability of the CAP or its basic principles. The Council also underlined the need to maintain the Community's presence on international markets. In the light of the discussions, certain general guidelines were defined for the Commission for the conduct of further discussions on a bilateral and multilateral basis in the search for an agreement which is acceptable to all parties. These guidelines, which include our concerns, were confirmed by the Council on 4 October and by the European Council on 29 October.
The Commission held discussions with the US on 27 September and again on 13 October at which it raised the reinterpretation of the draft agreement as directed by the Council. The public US response was that it was not prepared to modify or reinterpret the agreement. Nevertheless, the Commission is committed to continuing discussions with the US and to seeking solutions to the problems identified. The US has been preoccupied with the North American Free Trade agreement and has been unable to discuss any aspects of the round until this issue is out of the way. We are hopeful that, in the context of the overall negotiations, the US will be willing to agree to some adjustment of the outline agricultural agreement. It is expected that Sir Leon Brittan will again meet the US Trade Secretary, Mr. Kantor, next week when the situation should become clearer.
The agricultural aspects of the negotiations were considered at today's meeting of Agriculture Ministers. I assure the House that Minister Walsh again outlined our concerns and the conditions which he will insist on before he can accept an agreement.
The Government will continue to press the Commission to seek solutions to the problems we have identified. We are not prepared to accept any agreement unless we are satisfied that the Community will put in place appropriate arrangements to ensure that our agriculture sector and farmer incomes are maintained at levels envisaged when the CAP was reformed. As I mentioned earlier, there are serious difficulties in other areas of the negotiations also and considerable work remains to be done if a comprehensive and balanced agreement is to be reached by 15 December.
As was indicated by Minister McCreevy, the Government will ultimately take a decision on Ireland's attitude to a final agreement if and when agreement has been reached in all areas and in the light of whether and to what extent our problems have been addressed. In this connection, the Government has made it clear that while it favours a successful, comprehensive and balanced conclusion to the negotiations, it will not be prepared to accept an outcome which would impose a disproportionate burden on any region or sector particularly agriculture.
I again commend to the House the amendment proposed by Minister McCreevy.
Deputy Nolan rose.
The Minister of State gave no indication of his intention to share his time.
If there is time remaining, I wish to share it with Deputy Nolan.
The Chair desires that an indication to share time should be announced at the commencement of contributions, otherwise I must call on a Member from the other side of the House.
In view of the excitement in respect of the match this evening, the Minister may have overlooked the matter.
Is it agreed that Deputy Nolan share the time allocated to the Minister of State?
In the interest of the harmonious development of political trade in this House, we will agree to the sharing of the Minister of State's time. We are showing more determination for balance than the Government is showing in its approach to GATT.
I wish to share my time with Deputies Penrose and Ahern.
Is that satisfactory? Agreed.
I welcome the opportunity to speak on this important issue. The balance of advantage in successfully concluding the GATT negotiations is in Ireland's favour.
A successful conclusion would lead to a stabilisation of world trade, international growth and to a strengthening of the multilateral trading system. As the Minister of State said, one of the main areas of concern to Ireland is agriculture. Negotiations are taking place under 15 headings and I would like to refer to two of these, agriculture and textiles.
I join with those who have expressed concern at the proposed changes in the agricultural sector. In some cases these would have a negative effect. For example, the proposal to reduce Community output of beef would have serious consequences for the beef sector and the knock-on effects on industry and the implications this would have for the labour market should be the source of serious concern for us all.
The Government is doing nothing about it.
The Government must protect the high labour content associated with beef production. I am glad the Minister of State repeated the commitment made by the Minister, Deputy Walsh, in this regard. We are being asked to make sacrifices in order to reach a successful conclusion to the GATT negotiations. I am disappointed that we will have to endure cutbacks and quota restrictions while other countries such as the United States, Australia, Canada and New Zealand will not have to endure the same discipline or reductions.
Exactly, and the Minister is doing nothing about it.
The Community has been asked to implement a cut of 30 per cent in its support regime. Since various commitments have been made to conclude the Uruguay Round negotiations by 15 December next — the fifth deadline to be set down — the Government must focus on agriculture and textiles. Along with France we have again drawn attention to the potential difficulties which the draft agreement presents for the agricultural sector in the Community but, more importantly, our domestic agricultural economy will suffer if our vital national interest is not protected.
The Government and the Minister for Agriculture, Food and Forestry must insist in the negotiations that the special needs of the agricultural sector are taken into account in drafting in the final agreement. While some commentators and economists have highlighted the fact that farmers' incomes are expected to increase significantly this year, there is evidence that certain sectors, particularly the beef sector, are feeling the effects of the world recession.
The face of farming has changed during the past 20 years. In some instances this has proved to be beneficial but there is also a down side in that there is a move towards larger farm units. This is regrettable. The small family farm as we know it will soon become a thing of the past if we do not act immediately to safeguard its interests. While I accept there are serious difficulties in other areas, I must impress upon the Minister of State the seriousness with which we view these GATT negotiations.
I am grateful for the opportunity to speak on this topic as it is of great interest to me and many of my constituents. The General Agreement on Tariffs and Trade is an international treaty establishing the rules for the conduct of world trade. Its overall objective is the reduction of barriers in trade and, accordingly, an increase in the volume of trade. Since 1986 efforts have been made to conclude a global and balanced package and this has taken on a renewed impetus in recent times, as was clearly demonstrated at the G7 Summit in Tokyo in July.
The MacSharry-Madigan deal — the agreement made in November 1992 between the negotiators for the EC and the US on agricultural issues in the GATT — is commonly referred to as the Blair House Agreement. I appreciate the fact that this is a small open economy and that the successful conclusion of the GATT discussions, which should promote international growth and lead to the strengthening of the multilateral trading system, would be in our long term interests.
Nevertheless, there are some significant obstacles to be overcome before a successful conclusion can be reached from our viewpoint. While I appreciate these obstacles are not confined to the agricultural sector — we have only to consider the impact the agreement might have in other areas such as textiles — it is generally accepted that agriculture remains a very important element in the overall negotiations. Coming as I do from a midland county, it will come as no surprise that I intend to focus upon agriculture in my contribution to this debate.
The position in relation to agricultural support and trade appears to be as follows: First, internal support for agriculture would be cut by 20 per cent over six years, with the exception of certain "green box" supports which are considered as not being linked to production or prices which are regarded as controlling production. The average for the period 1986-88 would be used as a base and credit would be given for reductions in support achieved since then. Second, export subsidies, refunds, would be cut over six years by 36 per cent in financial terms, while the volume of products covered by refunds would be cut by 21 per cent compared to the average for the period 1986-90. Third, import levies in operation during the 1986-88 period would be converted to tariff equivalents and reduced by 36 per cent over six years. In addition, there would be a minimum access requirement of 3 per cent of internal consumption in the first year and 5 per cent in the final year relative to the average for the period 1986-88.
These restrictions and cuts go far beyond anything envisaged under the CAP reform measures. This is the reason Ireland must continue to highlight the non-acceptability of these measures, both from an EC and Irish point of view, as they involve a greater commitment from EC farmers and go beyond what is required by CAP reform measures. This would, in effect, lead to an unacceptable and disproportionate burden being carried by Irish farmers and the Irish economy.
I will now briefly examine the implications of the GATT proposals for the beef industry in Ireland in particular. It is widely accepted that the greatest problem for the EC arising from the GATT proposals would be faced in the beef sector — beef is approximately 11 times more important to the Irish economy than to the overall EC economy. It is quite clear that the current position in relation to agriculture is not balanced and imposes a disproportionate burden on the agricultural sector in Ireland in particular, given our peripheral location and small domestic market.
I strongly support the Government in its stance that since the proposed agreement would require the Community to take additional stricter measures over and above the CAP reform decisions of 1992, our special dependence on agriculture should be fully recognised and taken into account in the implementation of any agreed commitments.
It is clear that the proposed volume restraint on subsidies exports is a serious aspect from Ireland's point of view. Ireland has a high dependence on exports to non-EC markets and, while it accounts for 6.6 per cent of total beef production, it accounts for 24 per cent of EC exports. Thus, Ireland is particularly vulnerable to the export refund cuts. Ireland and Denmark are the only EC countries with the necessary health status to export to Japan. This would necessitate a moderate level of refund as the Japanese market is protected by a tariff of approximately 50 per cent. Accordingly, I urge the Government to make a case to ensure that Ireland is excluded from such cuts on the grounds of its vital national interests.
There are a number of other factors which we must bear in mind in this discussion. It is projected that the total intake of beef into EC intervention would be reduced from 750,000 tonnes in 1993 to 350,000 tonnes by 1997 under the CAP reform measures and that the additional oversupply arising from the GATT would be likely to result in EC beef prices falling by considerably more than the 15 per cent envisaged under CAP reform. This would have serious long term implications for the Irish economy.
The Andriessen Agreement — an EC concession in 1985 under which refunds are not payable on export of beef to Japan and South East Asia — would appear set for an indefinite extension under the current US-EC draft agreement. As I have already stated, Ireland and Denmark, which have the necessary health status, will be unable to capitalise on this market due to this lack of refunds. This is particularly important point, in view of the fact that this is a rapidly expanding market, and an extension of the Andriessen Agreement would mean that the EC would be effectively handing over this market to the US and Australia.
Another technical problem is that EC intervention stocks, which now stand at less than 850,000 tonnes, would have to be disposed of before the GATT is put in place. Under the GATT rules as they stand, if these stocks were disposed of outside the EC, from 1995 onwards they would be treated as subsidised exports. This would entail an even greater reduction in commercial exports to non-EC countries to allow the EC remain within the GATT limits in relation to these exports.
Another technical problem, as I see it, is "front loading" of the cuts. This means that most of the cuts would be made in the initial year. Every effort must be made to ensure a more even spread of the obligations to meet the commitments and, accordingly, the front loading provisions should be renegotiated and an extended period of at least six to eight years sought for the implementation of the obligation.
Another major issue which needs to be addressed as a matter of urgency is the question of aggregation. All meats would be treated as one for the calculation of import access and export refund reductions. It should be noted that Dunkel opposes aggregation in so far as his proposal is that cuts should apply to each individual product. The achievement of aggregation would significantly limit the damage to the total meat market in the EC.
Our bottom line, therefore, in any negotiations in relation to a GATT deal is that it should be compatible with the CAP reform package agreed in 1992. We must not pull any punches with the Commission in seeking to persuade it that adjustments must be secured to ensure that the EC is not forced to take additional restrictive measures.
It is quite clear that a successful conclusion of the negotiations would be in our interests, nevertheless it should also be quite clear that for a deal to be concluded, it will have to be balanced to allow the EC to continue to support and protect its agricultural and food sectors at reasonable levels. The bottom line is that it should not be a deal at any price. I, accordingly, advocate that the Government should continue its policy of ensuring that there are changes in the Blair House Agreement which take cognisance of the importance of the agricultural sector in relation to Ireland.
In particular I ask that: (a) The export volume limitations should be reduced to be totally compatible with the CAP reform agreed in 1992. It is quite clear that the European Community has already accepted reductions in support and protection levels and that the GATT which would require the Community, Irish agriculture in particular, to endure further significant cutbacks would not be acceptable.
(b) We need a period of six to ten years to implement the export and import commitments. We require this minimum time span to allow a rational adjustment to the new liberalisation of trade and to avoid serious distortion in world trade.
(c) Aggregation of import commitments will have to take place, particularly in relation to the meat sector. The front loading provisions will have to be scrapped, and a more even spread of the obligations to meet the commitments should be over an extended period of time. (d) Every effort should be made to ensure that the EC has full access to the beef market in Eastern Asia. Accordingly, the Andriessen Agreement should not be extended and incorporated in the current GATT and I urge the Minister to make every effort with his EC partners to ensure that this end is achieved. (e) As I already stated, the main problem is the proposed commitment to limit the volume of subsidised exports which are used mainly by the Community, and as Community products are unlikely to become competitive at world market prices, they would have to be reduced. This would be particularly acute in the beef sector, where there would have to be a reduction in beef output of up to 500,000 tonnes by the end of the agreement under the current proposals, based on current production this would lead to a 5 per cent reduction to meet this commitment, which, as I stated previously, is well in excess of what will result from CAP reform.
There are some 850,000 tonnes of beef in intervention stocks at present, and this would have to be disposed of with the permitted ceiling. Accordingly, it is vital that current stocks should be totally exempted from export commitments, both in volume and budgetary terms.
So the Deputy will support the motion?
Although I have focused on agriculture, I realise that there are some 14 other topics to be negotiated in the round, apart from agriculture, including such diverse subjects as intellectual property rights, services, market access and textiles, and I earnestly support the Government's efforts to ensure that Ireland's vital interests are fully protected.
Our negotiators must involve themselves in finalising a balanced GATT agreement. I hope the concessions we are seeking are taken on board by our negotiators. I know the Government is fully committed to ensuring that Ireland's vital interests are fully protected and that Irish farmers, agri-business and industry will be able to focus their strategy on the opportunities in the aftermath of a balanced agreement.
I want to propose an amendment on behalf of Democratic Left.
The Deputy may not move an amendment but may refer to it freely in her contribution.
In speaking about the GATT, I am conscious of how limited public knowledge is on this subject and, indeed, how limited knowledge of the complexities of the agreement is among Members of this House. I am also mindful of Mr. Peter Sutherland's dictum on the complexities when he said: "if you are not confused, you are not listening". That said, there is no doubt that the implications of the GATT are universal and will impact not just on the agricultural sector but on all of us, although the debate so far has been dominated by agriculture.
The Uruguay Round of the world trade talks is now more than seven years old and two years overdue. The GATT has seldom been the subject of a proper debate in this House and the Government has shown a remarkable complacency about its implications for the Irish economy.
The Minister for Tourism and Trade recently announced he had commissioned an outside expert group to conduct a consultancy study on the likely impact of a GATT agreement. There is no sign of this report being published. Indeed, when pressed, officials in his office could not give any indication as to when it might be published.
It is extraordinary that as we approach 15 December deadline we do not have available to us an in-depth sectoral analysis of the potential gains and losses that will result from GATT. At question time, Deputy McCreevy gave a glib reply that, while not all sectors will benefit equally, without a shadow of doubt the successful conclusion of a GATT will be in our overall interest. Last night's contribution from the same Minister did not enlighten us much further.
If we take as an example the clothing industry the importance of a full sectoral analysis of the implications of free trade is obvious. There are 15,600 people employed in this sector, which is the equivalent of one out of every 12 jobs in manufacturing. Sixty per cent of output is exported and almost 90 per cent of companies are in Irish ownership. This is a highly exposed sector of the economy and since 1989 2,000 jobs have been lost. The industry believes that unless it can become more competitive further jobs will be destroyed. The increase on VAT in the last budget has simply put another nail in the coffin of jobs in an industry which is labour intensive. More important it is an industry in which we have proved our talent and creativity and could have a chance of developing in the right climate.
The complacency of the Government in the run-up to the GATT deadline is all the more worrying now that there is an increasing possibility that the whole process might break down. That should give us cause for consideration. Mr. Peter Sutherland has warned that failure would mean "lurking chaos" and may herald a return of economic conditions which provoked the depression of the 30s. Failure in December will not simply result in the status quo being maintained in international trade policies. He stated that “we will be on a very slippery slope ...and that there will be no multilateral system of sufficient weight and credibility to stop the world sliding into a mire of protectionism and lost economic opportunity.” Today's US Congress vote on the North American Free Trade Agreement will be critical. If NAFTA is voted down it may well derail the Uruguay Round itself. The unthinkable might happen. At the very least failure would result in short term damage to business confidence which would trigger a sharp fall in share prices and hesitation by companies in their investment plans.
I thank the Fine Gael Party for having provided us with an opportunity to debate the GATT. However, my impression is that there is no serious thinking going on within that party on the implications of GATT. Fine Gael takes its cue from the IFA, the same view that supported the insupportable opposition to the CAP reform. How any serious party could defend the milking of public money by an agricultural elite is beyond imagination. In 1987 the total value of grants and subsidies paid to the agricultural sector by the Department of Agricultural in one year was £191 million, excluding market support measures. By 1992 that figure had risen to £464 million. As a result we have rural unemployment, an underdeveloped food sector, a massive stockpiling into intervention and a constant demand for special treatment from farmers who represent neither the small, struggling farmer nor the rural community as a whole. There is grave concern for the future of rural communities arising from GATT and there is a need to protect our future chances of developing a flourishing food industry but to pretend that overdependance on the high level of CAP subsidies is not part of the problem is disingenuous. A recognition on Fine Gael's part and indeed on the part of the previous Labour Party speaker that a failure to reform the CAP long ago is part of the problem now would be refreshing and realistic. Instead the same old story is trotted out again. However, this time it is a story that could end in tears if we choose to follow its logic.
The consequences of the failure of GATT are obvious and the consequences of a full-blown GATT may also be very serious. For most people the merits of an agreement are considered axiomatic. Free trade has become an article of faith. Anti-GATT sentiments come only from the fringes, mostly from the environmental movement and from Third World groups. Since nobody is opposed to freedom it is hard to find anyone opposed to free trade, but language can distort as often as it reveals. For accuracy's sake it would be more appropriate to use the term "deregulated international commerce". Deregulation does not have the same aura about it. Look at Britain and the US. Look at the world's financial markets where billions of pounds can be shifted at the flick of a switch. Look at the demise of the Exchange Rate Mechanism of the EMS. During the 80s deregulation was the watchword of the idealogues of the New Right. It is a hooligan approach to policy making that has made life miserable for millions.
It still works better than COMECON.
Let us not forget that in the context of the GATT the key ideology is that of the transnational corporations that bestride the globe in their search for cheap labour and new markets. The World Bank reckons they control 70 per cent of world trade.
The present round of GATT was launched at the insistence of the US in response to lobbying by US based transnationals. They need to set up their operations in any part of the world, to have ready access to cheap labour, the cheaper the better, and raw materials, the cheaper the better, to be free of government regulations on labour, working conditions or environmental controls and to have direct access to markets around the globe.
The Uruguay Round may be seen as an attempt by the US to regain its preeminence as the world's economic superpower. In the past decade and a half, a significant proportion of worldwide manufacturing capacity has moved to low-wage countries, especially along the Pacific rim. The US has attempted to protect its pre-eminent economic position through promoting a trading system which will serve its interests. This is particularly true in the area of sophisticated computer technology, biotechnology, investment and financial services, telecommunications and the media.
More than 100 countries are involved in the GATT negotiations, but it is the big players who dominate — the US, the EC and Japan. The conflict between the US and Japan centres around the US-Japan trade deficit while agriculture subsidies are the main bone of contention between the US and the EC.
While the heavyweights slug it out the development needs of the Third World are being squeezed or ignored. The GATT view is that there is only one road to economic progress and that is through export-oriented growth, low wages and environmental degradation.
Free trade promotes economic growth and thus raises more resources for environmental policy; trade measures that hinder economic growth are counter-effective. If conflicts arise between free trade and unilateral environmental measures, priority should be given to free trade.
The lack of environmental awareness in the present provisions can give rise to the exclusion of environmental provisions in legislation in developed countries quite apart from preventing them being introduced in vulnerable underdeveloped ones. The GATT panel found that the US tuna ban contravened GATT provisions and, therefore, constituted a discriminatory trade measure even though it was an environmental matter. For example, the Dutch proposal to import only sustainably produced timber, will be illegal under GATT by the year 1995. From a Third World point of view any national policy towards sustainable management of forests will be undermined by the absence of such policies elsewhere. Deregulated trade stimulates a growth pattern based on the lowest production costs. So logging companies will relocate their activities at sites with the lowest production costs. Poor countries heavily dependent on trade will have no choice but to grant concessions to the logging companies; hence a discouragement for countries to protect their own resources.
Peter Sutherland, in an interview in Newsweek magazine last July, indicated that he might look at the environmental question once the present Uruguay Round is completed. That is closing the door after the horse has bolted. If the negotiations on the next agreement take as long as those on this one the polluting companies will be laughing all the way to the bank, secure in the knowledge that by that time they will have effectively buried any competitors who have any environmental conscience. There is little thought about policies that reduce poverty, promote equitable distribution of wealth, sustainable development, environmental protection and self-reliance, especially in the area of food production.
The rich north holds out the carrot of an expansion in world trade in the order of $200 billion a year to persuade the Third World to come aboard. However, the Secretary General of the OECD who made that estimate pointed out that the figure is highly theoretical. The putative gains will take place over ten years and some developing countries will be hurt. The estimated effects on some African countries already has shown that they will impoverish them further. In any case, the approach involves recycling the old, discredited trickle down development theory. the argument put forward is that the improved performance in northern economies will stimulate demand and open up more markets for products from the south. The north will benefit from increased demand in the south. Little thought has been given to the fact that economic growth in a finite world is often achieved only at the expense of the poor and of the environment.
As it stands, GATT will significantly undermine environmental controls. On 3 February 1992, just four months before the Earth Summit in Rio, GATT published its Document on Trade and Environment. That paper dissociates itself from the widely accepted sustainable development viewpoint, according to which economy and ecology should be linked and brings the discussion back several decades. The document presents two basic options. Effective measures to internalise environmental costs must be factored into the present round. Otherwise there is no incentive to invest in conservation programmes or appropriate new technology. The other key question that has yet to be faced up to is that of social equity. To avoid the present downward level on wages, any future agreement must enshrine procedures that protect the rights of workers to organise freely, to join unions and to engage in free collective bargaining. It must protect high safety and health standards and allow for adequate insurance for workers. Competitiveness must not be achieved at the expense of workers' health and safety. If trade is to be internationalised then so too must the essential rights that workers in developed countries have won and are now under threat.
Poor countries need to be able to protect their markets, fledgling industries and agriculture. Until the rise of the deregulation ideologues this was a central tenet of development economics. Any multilateral trading agreement must seek also to promote the principles of sustainable development. If the Rio conference in 1992 is to be anything more than a publicity jamboree for world politicians its principle of sustainable development must be adopted through the guarantee that environmental costs, which are increasing, and social costs are internalised in price structures.
There is a fundamental difference between the traditional form of protectionism, which at this stage nobody is arguing for whereby tariffs and quotas sustained inefficient industries and the use of tariffs to protect countries from having as deplorable social and environmental record. GATT may offer the only realistic way to foster an effective international environmental policy. To do so it must specify those principles. If it does not, the result will be further depression of wages, a reduction in workers' conditions and a drop in environmental standards worldwide.
On the question of accountability, we have seen already the democratic deficit in the European Union. Maastricht failed to meet the criteria of accountability. On a larger scale still GATT procedures take place behind closed doors. They are nondemocratic and non-transparent. There are proposals for a multi-lateral trade organisation as a successor to the GATT secretariat. As it stands that proposal would create an unaccountable, unelected body with immense powers.
GATT may be about free trade but also it must be about other things — the freedom to work without exploitation, to live in a decent environment and to have access to information. The democratic deficit is a serious matter that should be addressed. We are debating GATT in a vacuum. The sectoral analysis on Irish industry should have been published before this eleventh hour. The fact that it is not is, to me, the most disturbing evidence that the Government is unprepared and unwilling to face up to the reality of a global agreement of this type and that will have major impact on the future for Irish people everywhere.
I would like to quote the following from a recent article by the authors of a book entitled The New Protectionism:
Further trade liberalisation would take us in the wrong direction. It encourages the big players to seek cheap labour, undermines public demands for tougher environment and consumer protection standards and widens the gap between rich and poor, while removing hard-won welfare safety nets in the interest of international competitiveness....
If people want to protect their futures, they must press politicians to argue for more local trade and diversified economies. Consumers should be encouraged to buy, first, locally produced goods and services, second, regionally produced ones, and globally produced ones only as a last resort. For this to happen, the GATT would have to be transformed into a General Agreement on Sustainable Trade.
That is unlikely to happen between now and 15 December, but it is important to record these fundamental points. However, at the end of the day they will prove prophetic in relation to the viewpoints being expressed at present on GATT.
I wish to share my time with Deputy Sheehan.
I am sure that is satisfactory.
The Government's handling of the agricultural component of the current GATT talks has been incompetent and irresponsible. The Minister for Agriculture, Food and Forestry tamely acquiesced in the MacSharry agricultural policy reforms and did not understand until very late in the day to what extent these had been shaped to fit into a GATT deal which is totally unbalanced as far as the EC in general, and Ireland in particular, are concerned.
The Minister for Tourism and Trade last night, and the Minister of State tonight, virtually ignored the GATT provisions on agriculture and even though they are the basis of our motion. He proposed an appallingly weak amendment which is as politically inept as the whole Government approach up to now. It is absolutely clear beyond any doubt that the Blair House Agreement does not take account of Ireland's concerns in relation to agriculture. That is why we have put down this motion and that is why we reject the Government's empty, insane amendment.
As the GATT negotiations stand, the European community will be obliged to lower its internal agricultural price to world price levels; to reduce accordingly the level of export refunds and import levies required to sustain the target internal price levels; to substantially dismantle price support arrangements; to guarantee expanded access to Community markets for meat, diary products and other key products by exporters in other GATT partners while itself suffering a reduction in its ability to export and to accept that its meat exporters will continue to be excluded from the rapidly-growing Japanese market for meat.
The estimated cost to Europe has been referred to by a number of commentators. It is generally accepted that if the Blair House Agreement is implemented in its present form it will result in the loss of 4.5 to 5 per cent of our net milk quota and a reduction in cattle exports of at least £500 million to £600 million. This would be devastating for the Irish economy. The agreement could reduce our GNP by 2.6 per cent, which would be a major blow to any hope of economic recovery. We must not accept any agreement which constitutes a sell-out of the Irish national interest by the EC. Let us consider the effect of this agreement on Ireland as opposed to other EC countries. If Ireland has to bear a production cut of 15 per cent in beef, the relative burden will be almost 38 times as severe on the Irish economy as compared to the EC average. If the uniform milk quota of 5 per cent is applied right across the Community the Irish economy will suffer 7.6 times more severely than other EC economies.
We in Fine Gael are fully convinced of the need for further liberalisation of world trade. We support the general thrust of the GATT talks and indeed we are critical of the fact that some important areas of trade are not adequately covered by it. We support the belief that trade liberalisation will give a further impetus to world growth and that there are gains to be made for all participants. However, in no other sector is there an imbalance between trading partners approaching that which will be created in agriculture by the Blair House Agreement.
I have outlined the effects it will have on this country. Under its provisions the European Community will be a net loser in all the key agricultural product areas. The US, Canada, New Zealand and Australia will be substantial net gainers. It is utterly irresponsible of the Government to conspire in capitulating to the interests of those of our partners who will not have to undertake any control of production or any limitation of their exports of the kind the EC is being asked to accept, which will heavily impact on Ireland.
We put down this motion to strengthen the Government's position in the critical final stage of the negotiations. The Government, however, is so inept and incompetent that it cannot see this. I appeal to both Ministers here tonight that the sensible course to take is to withdraw the Government amendment, support our motion and get out and do some real negotiating rather than the limp posturing in which they have engaged up to now.
I thank Deputy Deenihan for sharing his time with me in this very important debate. It is clearly obvious that the agricultural provisions of the Blair House Agreement are completely unbalanced and to the disadvantage of the European Community, particularly Ireland. It is evident that the purpose of the proposals in the Blair House Agreement is to dismantle the EC Common Agricultural Policy and replace it with world prices. Acceptance of the United States proposals will result in an income loss of approximately £900 million per year, or 60 per cent of farm incomes, to Irish farmers, with major losses to the Irish economy. It is clearly evident that the purpose of the United States-CAIRNS group proposals is to gain free access to Europe's food markets. It is also evident that CAP reform constitutes the most complex and mind-boggling set of rules that would have a disastrous effect on the future of Irish farmers.
Ireland is a very small nation, accounting for only 1 per cent of the total European population and only 0.1 per cent of the world population. We are not blessed with a climate that will produce vines and citrus fruits; we are chiefly dependent on our agricultural industry which is our main natural asset. Almost a quarter of a million people are employed, directly and indirectly, in this industry which accounts for one-third of total Irish exports. In relative terms agriculture is more important to Ireland than to most other European countries. Responsibility for the preservation of the fabric of rural society on this island and the protection of the most vulnerable section of that society, the farming community, particularly small farmers from Cork to Donegal, rests on the shoulders of the Minister for Agriculture, Food and Forestry.
It is obvious that if the Blair House agreement is accepted by the Minister and the Taoiseach it will be deathknell of our farming industry. Does this Government want to turn the entire western seaboard from Mizen Head to Malin Head into a wildlife reserve for wealthy Europeans and international tourists to enjoy safari trips to that region? The Minister for Agriculture, Food and Forestry cannot sit idly by and allow this to happen. Is the Minister aware that United States farmers are highly subsidised to the tune of more than £20 billion per year to boost their agricultural output while they are advocating the total abolition and elimination of protection and support for the Irish and EC farming industry. It is of paramount importance that any long term world agreement must recognise the fundamental role of the family farm as the basic unit of production and the backbone of rural society.
The scenario we are now witnessing could be easily avoided were it not for the fact that the EC Commissioner of the day threw in the towel at Dromoland Castle to the United States representatives and the CAIRNS group who were wined and dined while our Commissioner failed to take off the kid gloves in the fight to protect Irish farmers. I ask the Minister — I am disappointed that my constituency colleague, the Minister for Agriculture, Food and Forestry, Deputy Joe Walsh, is not here tonight to wind up this very important debate——
He is in Brussels looking after the interests of Irish farmers.
From what we can see, he is not doing much of a job.
Deputy Sheehan without interruption, please.
I ask those who are deputising for the Minister to spell out clearly the benefits which will accrue to Irish farmers from the Blair House Agreement. So far as I can ascertain, any benefits are completely invisible or nonexistent. It appears that the Minister's motto is "Live horse and you will get grass". If the Blair House Agreement is accepted in its present form Irish agriculture will be left in a dormant position.
I do not have to remind the Minister of State at the Department of Agriculture, Food and Forestry that increasing numbers of farmers are disappearing from rural Ireland every year. My local co-op in west Cork has witnessed a scaling down of 50 per cent in its milk suppliers during the past five years. What future is there for agriculture in the west of Ireland? As an island nation we should be getting preferential treatment under any world trade agreement. After England is joined to mainland Europe by the channel tunnel Ireland will be the only island nation in the EC. The Taoiseach should visit as many capital cities as possible in an effort to engender support for Ireland's cause in the world trade agreement negotiations. It is most important that we do not sit back and be good Europeans on this issue. We have to protect the future of our main industry, agriculture, and the only way to do this is by fighting for a better deal at the next world trade meeting.
I wish to say first — I am sorry she has left the House — that it was bizarre to listen to Deputy McManus's solemn and gratuitous lecture about development issues and democratic deficits. I am afraid that Democratic Left has not yet woken out of its slumber. The criticisms it makes of the capitalist system pale into insignificance when we remember that the COMECOM system not only was the most polluting system the world has ever known but was also the most oppressive system the world has ever known — it beggared and killed millions of small peasant farmers throughout the world. Democratic Left has not yet found out that that system no longer exists. Democratic Left is not in any position to lecture anybody.
It is a joke for a party which has so recently come out of the long sleep of democratic centralism to come in here and talk seriously to us about a democratic deficit. There is another kind of deficit Democratic Left knows about — it is a very democratic deficit for it. That party simply changed its name, walked away from debts and formed a new party. If anybody else in our economy did this, that party would be howling for new laws to enable the Revenue Commissioners to go after them to collect the money. I am not a bit impressed by the complaints from Democratic Left that there have been few opportunities in this House to discuss the issues of GATT. That party has much reshaping of its own thinking to do before it has much to tell the rest of the world about a democratic system of organising world trade.
The Fine Gael motion, which I again invite the Government to support on reflection, deals only with the agricultural aspects of the GATT negotiations. I was disappointed last night to hear the Minister for Tourism and Trade departing from his script — it is a dangerous thing to do if one does not know what one is going to say — and making smart alec remarks about the fact that there is more to the GATT than agriculture. I know that perfectly well, but the agricultural part of GATT is the one which concerns us; it is the one which puts most pressure on Irish farming; it is the one which puts most pressure on the European Community. The Minister for Tourism and Trade and the Minister of State at the Department of Agriculture, Food and Forestry are doing very little service to their Government and the people they represent when they come in here and make smart alec remarks and tell the rest of us that there is more to the GATT than agriculture.
Of course, it is true that if one goes into any pub, club or other place where people meet in rural Ireland and listens to people talking about the GATT, they will be talking about the effects of the Blair House Agreement, that is the part of the agreement which will hurt them. They will not be talking about intellectual property rights — they are not very involved in that — or textiles because, as my colleague, Deputy Seymour Crawford, pointed out, there are very few places left in the country where there is an immediate interest in the textile industry. The Government has done its best to strangle the life out of this industry through the 21 per cent rate of VAT imposed in the last budget. I am not talking about these issues, but I could talk about them. We might have a lengthy debate here another night on areas with which the Minister for Tourism and Trade might claim some passing acquaintance. It shows how little the Government cares about the damage which will be done to our agricultural industry and how little it can do about the issue confronting us when the Minister for Tourism and Trade can come into the House and speak to us for almost half an hour and ignore the motion before the House.
That is the impression I have had from the very beginning of these discussions. As I said last night, I see very little evidence that the Government has made any real effort to deal with the issues facing us, to anticipate the effects of what it has agreed in a CAP reform was driven by Ray MacSharry's and Jacques Delors' intention to get a trade deal with the United States in the GATT. That is the main reason the CAP reform took the shape it did. When the Minister for Agriculture, Food and Forestry, his lieutenant and the Minister for Tourism and Trade come into the House and say they will be happy if in some way they can make the GATT agreement fit within the framework of the CAP reform, it is an admission that they have been defeated right from the very beginning. They were outsmarted by Ray MacSharry, who in turn was outsmarted by Carla Hills for the United States. Since the beginning of these discussions, particularly since the discussion in Dromoland Castle, the European Community has allowed itself to be out manoeuvred, outboxed and outfoxed by the American negotiators.
We have seen evidence of this even this week. For the past forthnight the US negotiator, Mickey Kantor, has refused to talk to anybody else about the agricultural aspects of the GATT deal because, as he says, they are so busy getting agreement in Congress on the North American Free Trade Agreement. That is very convenient story, but it is also a very transparent ploy. He is like the young lady who likes to keep a few suitors dangling — he tells them he does not have time to talk to them now but if they hang around he might have some time to talk to them next week. The love sick swains on the opposite side of the House, who only want to cosy up to the United States for a GATT deal fall for that story, hook, line and sinker. However, they will suffer the same fate as some of those smart alecs — they will be left on the shelf when the lassie has gone off with somebody else. I am sorry to say that the Government is falling for that story. It is one of the oldest tricks in the book in negotiations. The Government has fallen for this story mainly because it was talked into it two years ago by Ray MacSharry. As my colleague, Deputy Seymour Crawford, said, it was not until we changed Commissioners that the Government began to come out of this trance and realise the danger we were in from the US-driven reform of the CAP.
The Minister of State at the Department of Agriculture, Food and Forestry tried to give us the same ráiméis tonight as the Minister for Tourism and Trade tried to give us last night. I want to quote comprehensively from his speech——
I was stating the facts, but the Deputy did not want to hear them.
He said, for example, "Notwithstanding the media focus, the agriculture aspects have not been either the only or the most difficult elements of the negotiations". So what? I am concerned about the agriculture side. If we wanted to have a debate on the whole GATT we would have put down a motion to that effect. But that is not what will ruin our farming population and our rural communities, it is the agriculture part of the GATT. The Minister will not get away with trying to evade his responsibilities in this area.
He goes on to say "Apart from agriculture there are continuing and significant obstacles to be overcome in a number of important areas...". I want to know why Minister McCreevy last night and Minister of State Hyland this evening raised that here. Why do they want to discuss everything but what is in the motion? I suspect the reason is they have not got the slightest clue what they will do to deal with the concerns we have put forward in the motion. The Minister has shown his inadequacy again tonight; he has revealed just how little they want and how little they feel they can get.
The Minister said tonight "We have always emphasised that any GATT outcome must be comprehensive and balanced and not impose a disproportionate burden on any country or sector". That is fine, but what will the agreement now before us do? It will impose a disproportionate burden on one of the partners, the European Community, on all the partners of the European Community and particularly on us, because we are so much more dependent on agriculture than any other member state. It will impose a disproportionate burden on one sector, agriculture, in the European Community. As I pointed out last night, no other sector will find itself in a position where all the cards are stacked against it. In the context of this GATT only in agriculture is there the kind of one way street we see. There is no other sector where the United States, New Zealand, Australia and Canada gain all the way while the European Community loses all the way.
In no other sector in this GATT does the European Community have to accept unilaterally restrictions on its level of production, restrictions on its ability to export and is required to obtain permission to operate any internal compensation for its own producers. There is not other sector in the whole GATT. If the Minister for Trade and Tourism, who says he is in charge of these negotiations, can contradict me, I challenge him to indicate any other sector where that is the case.
What does the Government continue to say? It wants reinterpretations and clarifications. The Minister of State here tonight recalled for us again — as if we needed any reminding — the principle aspects of what will happen, the horror list. Domestic supports will be reduced by 20 per cent; border measures such as variable levies will be reduced by 36 per cent; there will be minimal access commitments of up to 5 per cent of the Community market for other countries; average volumes of exports are to be reduced by 21 per cent and so on. What does the Minister offer us as a consolation for that? The Government is seeking reinterpretations and clarifications.
What will the Minister for Agriculture, Food and Forestry, who is supposed to be doing everything on our behalf, do for us? In a statement of 20 November 1992 he stated that he remained very concerned. I quoted from that statement last night and I was not very selective in doing so. I quoted a whole series of statements from the Minister for Agriculture, Food and Forestry throughout the whole month of November last year, the month the Minister threw in the towel. I even quoted a statement by the Taoiseach from November of last year when he ran up the white flag by saying that he believed Ray McSharry had got the balance right. If ever a Taoiseach undermined his Ministers, that was the occasion when it was done. If ever a Taoiseach cut the ground from under the man who was supposed to be negotiating on our behalf, that was the time it was done. He said that Ray McSharry had got the balance right and thereby sold out the interests of Irish agriculture in this context.
What did the Minister say in November of last year? He said that he will need to be clear that these volume limitations can be accommodated within the CAP reform arrangements before there can be any question of his acceptance of the agreement in the Agriculture Council. That was the surrender clearly signalled again. That was an admission — and the more often it is stated the more tragic the admission becomes — that the pass was already sold before anybody ever sat down to discuss reinterpretations and clarifications of the Blair House Agreement. This Government praises the CAP reform, although its supporters do not. The members of Fianna Fáil Cumainn around the country would not give you a thank you for that CAP reform because——
What would the Deputy's alternative have been?
——one can still find sensible people there. They will not thank Minister of State Hyland for coming down to them and telling them that as a result of this CAP reform——
What is the Deputy's alternative? Nothing other than cynical negative comments.
——and the accommodation of the GATT within the CAP reform, they are facing a 20 per cent reduction in milk prices over the next five years. They are facing a 21 per cent reduction in the volume of beef production over the next five years and they will be wondering where they will go when they have to cope with another 2 per cent cut in their milk quota and when the intervention weight limit for beef is reduced to 340 kilos and they find that they cannot export live cattle any more because some of the markets to which they go will not qualify for export refunds. They have no market to which they can sell their cattle. They will not thank Minister Hyland for that and they will not thank him for telling them that this was all Ray MacSharry's idea and that this is the great CAP reform that the Taoiseach, Deputy Albert Reynolds, accepted last November.
When we examine a little more closely what the Minister said tonight we see the real weakness in the Government's position. What is the Government doing? Its difficulties are with the timescale for reducing subsidised exports by 21 per cent. In other words, it is saying that it does not want to suffer too much of this 21 per cent cut in the first and second year; it wants it postponed until the fifth and sixth year. What the Minister is actually saying when he puts this out — and this is an admission by him that what I am saying is true — is that he wants the European Community to ask Mickey Kantor, the US negotiator, not to hang us quickly but to strangle us slowly instead.
I wonder is it the understatement of the century that the Minister said tonight that "it remains our view that the current proposed commitments would create difficulties for Community and Irish agriculture"? What is the man thinking of? What does he mean by difficulties? Milk producers are facing a 20 per cent reduction in the price of their product over the next five or six years. Therefore, from receiving £1 a gallon now they will be down to 80p a gallon in five years' time in today's money terms.
You hope.
In addition to that they will have the right to produce 2 per cent less milk than they are producing now. What will they do to support their families? How much jargon from Democratic Left will they be able to use to put bread on the table and to run a farm with a further quota cut of 2 per cent? Some of the Deputies opposite might know a little about that. There are still a few small milk producers in my constituency of Kildare. They are still a few in the constituency of Longford-Roscommon. There are not too many in Longford-Roscommon; they have other things to do there. There are still a few in the constituency of Laoighis-Offaly and they will be seeking guidance from the Minister, but all he will offer them is his understanding of their difficulties when they cannot pay the bills.
Beef producers are facing a reduction of 30 per cent in the price they get for their product and the volume of Community production will be cut by 9 per cent. That will mean that the volume of production in this country will be cut by even more than that. Therefore, people already under pressure and who cannot make a living will be told they will have to make do with less, all because ex-Commissioner Ray MacSharry got the Minister for Agriculture and Food, Deputy Joe Walsh, to agree that we should all support this famous CAP reform driven from Washington.
Perhaps the Deputy will now conclude.
There was evidence this evening that some Government Deputies now understand the problem — Deputies Nolan and Penrose said the same things we are saying. If the House passes the motion before it, it would strengthen the Government's hand as it could say that our democratically elected Parliament does not want to accept the present agricultural arrangements, it should play it with a hard ball for a change——
That is what the people opposite are doing.
——play the Americans at their own game. The Government is giving in all along the line, every damn time they make a new demand the people opposite say: Yes, Sir, yes Sir, three bags full, Sir. The Government should withdraw its amendment; do the decent thing; get a motion behind it that will strengthen its hands and do some good for a change for the people who elected them.
Amendment put.
The Dáil divided: Tá, 69; Níl, 45.
Tá
- Ahern, Dermot.
- Ahern, Michael.
- Ahern, Noel.
- Bell, Michael.
- Bhreathnach, Niamh.
- Bree, Declan.
- Brennan, Matt.
- Broughan, Tommy.
- Burton, Joan.
- Byrne, Hugh.
- Callely, Ivor.
- Connolly, Ger.
- Costello, Joe.
- Coughlan, Mary.
- Cowen, Brian.
- Dempsey, Noel.
- Doherty, Seán.
- Ellis, John.
- Fitzgerald, Brian.
- Fitzgerald, Eithne.
- Fitzgerald, Liam.
- Flood, Chris.
- Foley, Denis.
- Gallagher, Pat (Laoighis-Offaly)
- Haughey, Seán.
- Higgins, Michael D.
- Howlin, Brendan.
- Hughes, Séamus.
- Hyland, Liam.
- Jacob, Joe.
- Kavanagh, Liam.
- Kemmy, Jim.
- Kenneally, Brendan.
- Kenny, Seán.
- Killeen, Tony.
- Kitt, Micheal P.
- Kitt, Tom.
- Lawlor, Liam.
- Leonard, Jimmy.
- Martin, Micheál.
- McCreevy, Charlie.
- McDowell, Derek.
- Morley, P.J.
- Moynihan, Donal.
- Moynihan-Cronin, Breeda.
- Mulvihill, John.
- Nolan, M.J.
- Ó Cuív, Éamon.
- O'Dea, Willie.
- O'Keeffe, Batt.
- O'Leary, John.
- O'Rourke, Mary.
- O'Sullivan, Toddy.
- Pattison, Séamus.
- Penrose, William.
- Power, Seán.
- Ryan, Eoin.
- Ryan, John.
- Ryan, Seán.
- Shortall, Róisín.
- Smith, Brendan.
- Stagg, Emmet.
- Taylor, Mervyn.
- Treacy, Noel.
- Upton, Pat.
- Wallace, Dan.
- Wallace, Mary.
- Walsh, Eamon.
- Woods, Michael.
Níl
- Ahearn, Theresa.
- Barrett, Seán.
- Boylan, Andrew.
- Bradford, Paul.
- Browne, John (Carlow-Kilkenny).
- Burton, John.
- Carey, Donal.
- Clohessy, Peadar.
- Connaughton, Paul.
- Connor, John.
- Crawford, Seymour.
- Currie, Austin.
- Deasy, Austin.
- Deenihan, Jimmy.
- De Rossa, Proinsias.
- Doyle, Avril.
- Dukes, Alan M.
- Durkan, Bernard J.
- Finucane, Michael.
- Fitzgerald, Frances.
- Flaherty, Mary.
- Foxe, Tom.
- Gilmore, Eamon.
- Harney, Mary.
- Harte, Paddy.
- Higgins, Jim.
- Hogan, Philip.
- Kenny, Enda.
- Keogh, Helen.
- Lowry, Michael.
- McCormack, Pádraic.
- McGahon, Brendan.
- McGinley, Dinny.
- McGrath, Paul.
- McManus, Liz.
- Molloy, Robert.
- Nealon, Ted.
- Noonan, Michael. (Limerick East).
- O'Donnell, Liz.
- O'Keeffe, Jim.
- Owen, Nora.
- Quill, Máirín.
- Rabbitte, Pat.
- Sheehan, P.J.
- Yates, Ivan.
Tellers: Tá, Deputies Dempsey and D. McDowell; Níl, Deputies E. Kenny and Boylan.
Amendment declared carried.
Amendment No. 2 not moved.
Motion, as amended, put and declared carried.