TNAG-0281-FCO40-317-Visit-of-the-Chancellor-of-the-Duchy-of-Lancaster-to-Hong-Ko-1970 — Page 26

22

CONFIDENTIAL

stability and wellbeing of the Western world. Mr. Rippon said that Britain must be strong to be of any use to anyone. We judged membership of the Community to be a paramount British interest and hoped, although we did not always say out loud, that we would be able to influence the Community, and in particular those of its policies with which we did not entirely agree, in a more liberal and outward- looking direction.

British policy: East of Suez/South Africa

2. Mr. Whitlam raised the question of British policy East of Suez. Mr. Rippon said that we thought a small physical presence was of great psychological importance. Turning to Conservative policy towards South Africa, he said that it would be hypocritical to ask South Africans to do more in defence of the sea lanes round the Cape and then refuse them the means with which to do it. In many ways it would have been much easier if NATO had covered the South as well as the North Atlantic. Mr. Whitlam said that he understood why Her Majesty's Government felt as they did, but thought that the cost in terms of British interests elsewhere more than outweighed the benefits. He felt bold enough to say this because whatever Britain did in this respect repercussed on Australia and hence on his own party.

Australian agriculture

[At this point Mr. Patterson joined the meeting.]

3. Mr. Patterson said that his party was naturally as preoccupied as the Government with the problems of Australian agriculture. The trouble was that the industry had had its head in the sand for a long time and had not undertaken long overdue changes. The production of butter should, for example, be better geared to need. There should be better use of Australian resources in this respect. The sugar industry was a somewhat different case but there were points in common. What, if anything, was Mr. Rippon going to do about these problems in the negotiations? Mr. Rippon replied that he did not think he could achieve more than a transitional period. The problem of over-production of certain commodities was world-wide and should find world-wide solutions. As for the attitude of the Community, it would be much easier to change it from inside than outside. Mr. Patterson said that Her Majesty's Government could really forget about the problem of Australian butter but that of sugar was very serious. When asked what would happen if and when Australia lost her market for sugar in Britain, Mr. Patterson replied that it would not be disastrous if Australia had a long enough period in which to make the necessary adaptation. The world demand for sugar was rising gradually and prices were going up accordingly; but this favourable trend would be upset if Australia had abruptly to unload the sugar she was now sending to Britain on to the world market.

1

+

CONFIDENTIAL