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Coalition still concerned about Dunkel deal

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ALEXANDER DOWNER Member fo r Mayo, Shadow Minister fo r Trade & Trade Negotiations


The Federal Opposition said that while it accepted the Cabinet had no choice today but to adopt the Dunkel proposal to save the Uruguay round of world trade talks, it believed the Government should enter a range of reservations it has about the deal.

The Shadow Minister for Trade, Alexander Downer, said that although the Dunkel proposal would provide some relief for Australian farmers, the proposal would not have a major impact on world farm prices and access to third markets for several years and it contained a number of escape clauses for countries which protect their agricultural sectors.

Mr Downer said, "The Dunkel paper falls a long way short of what Australia and the Cairns Group was hoping to get out of the

Uruguay round and we should make clear our disappointment at the negotiating table in Geneva.

"We believe Australia should enter a range of reservations on the deal."

Mr Downer said the Coalition had four specific reservations.

* First, the EC and the US will not be

prevented from extending their export

subsidies to new markets even though they will be prevented from extending the

subsidies to new commodities.

* Secondly, while the 36 per cent reduction in tariffs on farm imports and the

tariffication of farm protection sounds good, in reality the 36 per cent figure is an average and some tariffs can be reduced by as little as 15 per cent. The major

tariff reductions could be in commodities of marginal or no importance to Australia. Furthermore, a country like Japan will be

able to set its rate of tariff protection for rice at an absurdly high level thereby effectively keeping the market closed

(except the three per cent minimum global access provided by the Dunkel paper).

* Thirdly, agricultural protectionists will be able to resort to a safeguards clause in


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certain circumstances without having to apply an "injury test". Under the

safeguards clause they will be able to keep Australian products out of their markets.

* Fourthly, while it may seem like progress

that the Dunkel paper provides for three per cent of any domestic market to be opened to outsiders, phasing to five per cent over six years, this is hardly a major breakthrough particularly in cases where some market share is already dedicated to specific

countries not including Australia.

Mr Downer said, "Australia and the Cairns Group was looking for a 90 per cent cut over 10 years to farm export subsidies rather than the 36 per cent cut over six years provided by the Dunkel paper.

"And while the commitment to "tariffication" of agricultural protection and tariff reductions of 36 per cent over six years is welcome, in practical terms it will not mean a lot to

Australian farmers.

"The proposal to reduce internal support for agriculture by just 20 per cent over six years also falls well short of Australia's demand for a 75 per cent reduction over ten years. That leaves the EC's notorious Common Agricultural Policy well and truly in place.

"The Dunkel proposals do not amount to a major breakthrough for our farmers, although importantly the proposals do establish for the first time the mechanisms to transform international agricultural trade over the long-term."

ends. Adelaide, 7 January 1992.


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