Canberra, undated
Confidential
U.K./ Australia trade talks, September, 19672
[ matter omitted ]
2. Arrangements were made for Mr Wood to attend the talks …
3. It is important to keep in mind that the British made it clear that they would see it as fatal to their application to join the E.E.C. if an agreed plan to retain mutual benefits had been worked out in any detail or even only to the point where both parties were committed to work for such a plan. The British made it clear that real opportunities to protect Australian (including P.N.G.) and U.K. interests were something which would have to be left for negotiation with an enlarged E.E.C. As the Minister for Trade and Industry has stated since the talks it seemed clear that Britain did not expect to gain from the E.E.C. any more concessions for Commonwealth trade preferences than the phasing out over the years.
4. In the discussions with the British on P.N.G. trade problems the delegation asked for retention of preferences or if that was not practicable solutions which would enable P.N.G. to market its exports on fair terms as compared with like exports from British Territories that may be given associate status. The delegation proposed that the latter be done by phasing out preferences in Britain over say 10 years and phasing in of P.N.G. into the same preferences as are enjoyed by associated territories in the expanded E.E.C. The delegation used arguments of moral obligation of U.K. and E.E.C. as members of the United Nations organisation, the obligations under the U.K./Australia Trade Agreement, and that P.N.G. is the least developed of lesser developed countries and the extreme dependence of coconut products in particular on the U.K. market.
5. However British officials would not be shifted from their stand that they had no legal responsibility that they could use against the E.E.C. The British accepted the Australian point that the preferences they accorded P.N.G. were paid for by preferences Australia gave Britain and they registered Australia’s concern for the P.N.G. products copra, coconut oil, coffee, cocoa, pyrethrum extract, palm oil and palm kernels. The Australian delegation flagged that P.N.G. products would come within the proposition for exploration with the E. E. C. and Britain of ways and means by which British important interests in Australia and Australian (including P.N.G.) important interests in Britain were preserved. The British said that in that event the most that could be tried for would be as soft decalage3 as possible and in the case of coconut oil a duty-free quota or lowering of the common external tariff.
[ matter omitted ]
8. The U.K./ Australia Trade Agreement will continue as at present subject to 6 months’ notice of termination on either side. The Trade Agreement of course applies also to dependent territories and two P.N.G. commodities—copra and coconut oil—are specifically included in the schedule to the Agreement.
[NAA: A452, 1967/6213]
1 E.J. Wood.
2 For background, see editorial note ‘PNG and Britain’s application to join the European Economic Community’.
3 In this context, the word should probably be translated ‘shift’.