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was the reason for the aide-mémoire. It had appeared also that the Commission was utterly indifferent to Australia's problems and therefore Australia had to fall back upon the legalistic arguments. When the Community had been formed Australia had said nothing since she was not a major supplier. If Britain joined she would be and she would argue that it was illegal under GATT for the enlarged Community to create barriers to her trade. He had discussed predatory dumping in Brussels. The Community had said they were interested in a butter agreement, but they had never been prepared to accept engagements under the International Sugar Agreement and all they now wanted was to legalise their existing sales.
Sugar
4. In relation to sugar, Mr. McEwen referred to Mr. Barber's statement at the opening of negotiations in Luxembourg when he had mentioned "Commonwealth sugar exports as one of the major problems for negotiations, without limiting this to exports from developing Commonwealth countries.
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5. Mr. Rippon said that this was simply a matter of not giving away a point unnecessarily at the start of negotiations. In practice it was the developing countries we were thinking of, and for Australia we should need to concentrate on getting a good transitional period. If the Community refused to move on any point, then the deal would be off. In practice the Community recognised that the application of the common agricultural policy would be different once Britain was a member, but it was impossible to say this at the outset. There had to be changes on both sides. The primary producers must adapt their production and supply what was wanted. Europe, for her part, might cut back production of sugar. Even the mountain of butter had diminished. A transitional period would give time to work on these problems.
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Australian lamb and dairy produce
6. Mr. McEwen commented on the fact that British policy seemed to turn only on a transitional period. So far as butter was concerned, he would not try to climb on New Zealand's back. They were utterly vulnerable. But how could Australian dairy farmers survive for, say, two years with a 100,000-ton surplus? Moreover, the transitional period would presumably be a tapering one, so it would not effectively cover five years. In reply to a question by Mr. Rippon Mr. McEwen said that if Britain did not join the Community he assumed that although we should support lamb and dairy producers some substantial market would remain for Australia.
7. In subsequent discussion Mr. Rippon urged that the Australian Government should not underestimate the value of a transitional period. He would put Australia's arguments forward and would fight as hard as he could, but there was no point in being unrealistic. There were some points on which we could not expect to make headway, but we could bargain for a generous transitional period and then, within the enlarged Community, we could expect to see the common agricultural policy evolve.
Problems facing Australian agriculture
8. Mr. Anthony said that the Australian agricultural sector was going through its worst period since the depression. Indebtedness was so serious that there might be a need for a moratorium. With the exception of meat, not one of the rural industries was in a sound position. If Britain joined the Community the present pressures would be accentuated. The Country Party was particularly vulnerable but the life of whichever Australian Government was in power would
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