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Friday, 23 August 1985
Page: 291

Senator RICHARDSON —My question is addressed to the Minister representing the Minister for Trade. Is the Minister aware of the United States `bonus' export program for agricultural trade? Does the Minister believe that this program will unduly affect Australia's agricultural exports, notably wheat, as the Australian Wheat Board estimates that one-third of Australia's wheat export income, $2.5 billion, could be lost? The United States Government recently announced the allocation of 500,000 tonnes of wheat to Egypt under this scheme. What is being done to ensure that Australian wheat exports to Egypt and other markets are not damaged by this scheme?

Senator BUTTON —Following the announcement of a $2 billion export enhancement program for agricultural products by the United States Administration, the Government's concerns about the implications of the program were transmitted to the President of the United States by the Prime Minister and during ministerial discussions with the United States Secretaries of State and Agriculture. The Australian Government was given assurances by the United States Administration that the EEP-the export enhancement program- will be targetted against subsidising competitors, and that the United States will be making it clear to recipient countries that it expects non-subsidised commercial trade to be maintained. Further sales under the program will be subject to this expectation being met. These assurances given by the United States Government are particularly important to Australia.

Following the last announced intiative by the Americans to target Egypt, the Minister for Primary Industry again expressed our concerns to the United States Secretary of Agriculture, indicating that it will result in downward pressure on wheat prices and is contrary to the key objective of targetting only subsidised exports. Secretary Block again reassured us that the United States had taken careful precautions to ensure that our wheat trade would be protected. No sales under the program have yet been made by the United States. Nevertheless, we are concerned at the possible implications on our wheat trade. The Government is closely monitoring the situation and maintaining close contact with the United States Government. The implications of Senator Richardson's question are that we are caught in a nasty little trade war between the European agricultural community and the United States and that the backlash can be significant for Australia. I think the best summation of the answer is that the Government is very conscious of the situation and is continually making representations to the United States Government about it.