RESTRICTED
4. ON OUR DEMAND FOR AN INCREASE IN THE 1974 QUOTA FOR TOBACCO WE
ARGUED THAT SINCE WE EXPECTED TO PAY MUCH HIGHER PRICES TOWARDS
THE END OF THE YEAR THAN THE AVERAGE PRICE FOR THE FIRST PART OF
THE YEAR WE WOULD EXCEED OUR SHARE OF THE QUOTA UNLESS WE COULD GET AGREEMENT TO AN ADDITIONAL 6 MILLION UNITS OF ACCOUNT. THE
ITALIANS ARGUED THAT OUR CASE WAS BASED ON CONSIDERATIONS OF
DOMESTIC SUPPLY RATHER THAN OF PROVIDING A BENEFIT TO THE EXPORTING
COUNTRIES. THE COMMISSION SAW DIFFICULTIES OF PRINCIPLE IN IMPROV-
ING THE QUOTA DURING THE YEAR AND WERE DOUBTFUL ABOUT THE TECHNICAL
DETAILS OF WHAT WE WERE SEEKING. THE FRENCH WERE FIRMLY OPPOSED IN
PRINCIPLE TO MID-YEAR CHANGES AND WERE SUPPORTED BY THE BELGIANS.
ALL OTHER DELEGATIONS ACCEPTED OUR PROPOSAL. IT WAS AGREED THAT
THE STATE OF THE DISCUSSION SHOULD BE REPORTED TO THE COMMITTEE OF PERMANENT REPRESENTATIVES (DEPUTIES) (PROBABLY 16 OCTOBER.
5. AS REGARDS THE 1975 QUOTA FOR TOBACCO THE FRENCH AND DUTCH
ACCEPTED THE COMMISSION'S PROPOSAL AS IT STOOD. THE GERMANS SOUGHT
AN INCREASE IN THEIR SHARE UNDER THE KEY. THE IRISH AND DANES ALSO
WANTED MORE. THE ITALIANS RESERVED THEIR POSITION AND RECALLED THE
EXCEPTIONAL NATURE OF THE 1974 QUOTA. THEY COULD HOWEVER AGREE TO
THE TRANSORMATION OF THE QUOTA TO A VOLUME BASIS. WE SAID THAT
THE QUOTA SHOULD BE SUBSTANTIALLY INCREASED. TOBACCO FROM THE JOINT
DECLARATION OF INTENT COUNTRIES WAS BEING SQUEEZED BY THE CONCESS-
1ONS WHICH THE COMMUNITY HAD MADE IN THE ARTICLE XXIV 6
NEGOTIATIONS AND TO THE ACP COUNTRIES. THERE WOULD ALSO BE A FURTHER
DISADVANTAGE WHEN WE MADE THE NEXT MOVEMENT TOWARDS THE COMMON
CUSTOMS TARIFF ON 1 JANUARY 1975. THERE WAS NO REASON FOR CONTINUING
THE FIGURE OF 22,000 TONS NEXT YEAR SINCE THE PROTOCOL IN THE GREEK AGREEMENT WOULD HAVE LAPSED BY THEN. IF IT WERE EXTENDED,
THE CUT OFF WOULD HAVE TO BE RAISED. WE SAID THAT TO ACCOMMODATE
OUR EXPECTED IMPORTS FROM COUNTRIES COVERED BY THE JOINT DECLARATION
OF INTENT THE QUOTA, ASSUMING THAT WE MAINTAINED OUR SHARE OF THE KEY AT 80%, WOULD NEED TO BE ABOUT 35,000 TONS. A NUMBER OF DELE- GATIONS POINTED OUT THAT IN PRACTICE A NUMBER OF COUNTRIES OTHER
THAN THOSE FOR WHOM THE QUOTA HAD BEEN INTENDED WERE BENEFITING,
PARTICULARLY BRAZIL. THE GERMANS SOUGHT THE ADDITION TO THE GSP
OF 24.01A.
6. WE RESERVED OUR POSITION ON SOLUBLE COFFEE AND COCOA BUTTER.
-2m
RESTRICTED
/7. THERE