120. Malta already has an association agreement which offers preferential trading arrangements but not aid; Cyprus is currently negotiating for a similar agreement.
AUSTRALIA
121. Our entry into the Communities will place at some risk only a small proportion-at most only 7 per cent of Australian export trade. In 1969-70 Britain took under 12 per cent of Australia's exports a very different situation from ten years previously when we were still buying more than 25 per cent. Products affected by the common agricultural policy, in particular, now represent a very low percentage of Australia's total exports-for example, dairy products sent to Britain in 1969-70 represented only 1.1 per cent of her total world exports; sugar only 0.7 per cent; and wheat only 1-2 per cent. Moreover, well over one-third of Australian exports to Britain are products which will enter duty free under the CET or benefit from the duty quotas agreed during the negotiations. For example, there will be no duty on raw wool which accounts for nearly 10 per cent of our imports from Australia; on metalliferous ores (6.4 per cent) or copper (2.7 per cent). Lead bullion (10-6 per cent) will benefit from the special duty arrangements described in Annex B.
CANADA
122. In 1970 only 9 per cent of Canada's total exports came to the United Kingdom, compared with 17 per cent in 1960. About 30 per cent of Canada's exports to the United Kingdom in 1969 were products which will continue to enter duty-free. A further 10-15 per cent would benefit from the special duty arrangements described in Annex B-the most significant of these for Canada are those on newsprint, plywood, wood pulp and phosphorus. The duty quota secured for plywood will extend to nearly all Canada's exports to the whole of the enlarged Community, and not merely those to the United Kingdom. Almost a further 8 per cent of Canada's exports to this country are likely, although facing levies under the common agricultural policy, to be affected only marginally, if at all, because they cannot be obtained within the enlarged Community: these are the hard wheat necessary for the type of bread traditionally in demand in British households and the special quality malting barley produced in Canada.
The Channel Islands and the Isle of Man
123. The Channel Islands and the Isle of Man have for centuries enjoyed a special constitutional position in relation to the United Kingdom. They have their own legislatures, and they have their own fiscal systems and special customs arrangements.
124. Their inclusion in the Community would present constitutional, administrative and economic difficulties. Accordingly, after full consultation with them, we are seeking for the Islands arrangements short of full membership which would provide for an exchange of reciprocal rights and obligations between the Community and the Islands. We have proposed that a form of association under Article 238 of the Treaty of Rome might be an appropriate way of dealing with the question.
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