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cost of cereals.
They recognised the need to change,
but they could not afford to pay some 300 mecus
annually in levies.
While they would not expect to
continue to receive US credits for cereals after
accession, they did not want to switch their source of
supply too radically.
For one thing it would be better
for Portugal in the budget chapter to have a levy minus
to score up than to incur a non-budgetary cost. They
had sought an application to Portugal of the temporary
reduction of import levies on coarse grain currently
applied in Italy, but had been told by the Commission
that this was not acceptable. Mr Hannay confirmed that
this proposal was unlikely to get very far.
7.
Sugar
Dr Marta explained
this was a sensitive area
for Portugal because of its sugar cane refineries.
Their hope to get some enlargement of the quantities in
the Community sugar protocol had been discouraged by
the Commission. They recognised the need to change
their suppliers from Cuba to Africa. Mr Hannay
expressed sympathy. We had also to think of our
domestic sugar cane refineries on accession (although
we had had to close 4 out of 6 since accession because
of decline in consumption).
We had not heard that the
Portuguese had proposed an increase in the quota from
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