A Service of Leibniz-Informationszentrum econstor Wirtschaft Leibniz Information Centre Make Your Publications Visible. zbw for Economics Schmücker, Herr Kurt Article — Digitized Version Will the Kennedy round succeed? Extension of the EEC Commission’s authorisation to negotiate increases chances of success Intereconomics Suggested Citation: Schmücker, Herr Kurt (1966) : Will the Kennedy round succeed? Extension of the EEC Commission’s authorisation to negotiate increases chances of success, Intereconomics, ISSN 0020-5346, Verlag Weltarchiv, Hamburg, Vol. 01, Iss. 5, pp. 4-10, http://dx.doi.org/10.1007/BF02923287 This Version is available at: http://hdl.handle.net/10419/137611 Standard-Nutzungsbedingungen: Terms of use: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Documents in EconStor may be saved and copied for your Zwecken und zum Privatgebrauch gespeichert und kopiert werden. personal and scholarly purposes. 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Extension of the EEC Commission's Authorisation to Negotiate Increases Chances of Success Interview with the Federal Minister of Economics, Herr Kurt Schmiicker, Bonn INTERF-CONOMICS: Minister body that this aim could only be a where special circumstances pre- Schmficker, the Kennedy Round hypothetical working basis and vail. This goes for instance for the was originally meant to liberalise that certain exemptions could not import of cotton textiles the future world trade. In the light of the ex- be avoided. No country in the of which is at present under review perience during the Dillon Round-- world is nowadays in a position to within the framework of negotia- when :there was much bargaining cut certain import duties in half tions for prolonging the Interna- over individual customs and an without endangering its own econ- tional Cotton Agreement, The average cut of import duties.by omy. On the other hand, there was question of cutting import dufi'es only 8 % was achieved--it was pro- a consensus of opinion that exemp- on them will only arise when the posed to apply to the Kennedy tions would only be justified where future of the international agree- Round the linear method of cutting a higher national interest was at ment has been clarified. Similar are tariffs. Yet, the aim of achieving in stake. the circumstances in respect of this way a general lowering of chemical products. Here the lower- In submitting its lists of excep- duties (by 50 ~ has been badly ing of the common tariff depends tions the EEC has stuck to this jeopardi,sed by the submission of on the USA modifying its Selling principle. However, within the EEC Price System which in the opinion lists of exceptions. The danger which is still in the process of of its trading partners does no therefore arises of returning to the establishing a common market it old bargaining method. In this con- longer conform with present day is, no doubt, much more difficult to nection the EEC is being accused conditions, determine the "higher national inter- of having stood out by submitting est" than ~t is in other countries Besides, no partner to the nego- particularly long lists of exception. whose economy is not subject to tiations has so far been able to Is this allegation justified? such structural changes. Despite all refute the EEC case for exemptions. Therefore I maintain that in the SCHMUCKER: Let me first deal this the Community has succeeded light of the exceptional difficulties with the starting point of your in compiling a justifiable list of ex- and the structural changes during question. It is correct to say that ceptions. It affects no more than the transition to the Common Mar- on May 6th, 1964, a GATT confer- about 20% of all EEC imports that ket the allegations that the EEC ence on ministerial level reached are subject to import duties, or, has submitted an unduly long list agreement to aim at a general cut taking total trade with third coun- of exemptions and thus endangers of customs duties on industrial tries into account, only 9% of all the success of the Kennedy Round goods by 50~ But right from imports. This calculation, it is true, is not justified. Seen from the Ger- the beginning it was clear to every- excludes some groups of imports man view we would rather have waived certain wishes for exemp- tion; but the EEC is a community where a just equalisation of the KURT SCHMUCKER interests of all partners matters. Federal Minister for Economic Affairs and the Federal Govern- INTERECONOMICS: Beyond tiffs ment's representative in the Ministerial Council of the EEC, has it is alleged that the EEC endangers contributed considerably to bringing about an extension of the the success of the Kennedy Round EEC-Commission's authorisation to negotiate. After a long period by its agrarian protectionism. The of inactivity as regards the Kennedy Round the road towards a USA is known to he interested par- worldwide tariff reduction within the framework of GATT seems ticularly in low farm prices within to be open now.--Kurt Schmficker was born at L6ningen/Oldenburg the EEC so as to be able to in- and after passing a high-class secondary school providing human- crease its own farm exports. There istic education and a commercial school he was thoroughly trained is therefore some doubt in various as a journalist and publisher. After having been a prisoner of war quarters whether the EEC really Schmficker worked in his parent's printing office which he took wants the quickest possible con- over in 1954. His political career he started as cofounder of Junge clusion of the Kennedy Round. Such. Union (Junior members of CDU) in Oldenburg. As Chairman of the doubt concerns especially the pol- Economic Committee and of the Federal Working Group "Middle icy of the German Federal Govern- Class" he became a member of the Federal Government in 1963. ment which in the negotiations be- tween the EEC partners has been pressing for higher farm prices. INTERECONOMICS, No. 5, 1966 SCHMUCKER: These doubts are reduction in industrial import du- whole complex of agricultural mar- not justified. We are anxious to see ties, would be practically "stripped ket regulations in the EEC coun- a successful conclusion to the naked". Others have pointed out tries. In view of these weighty Kennedy Round not only in the that such a situation would make it arguments, will not the EEC have industrial but also the agricultural impossible for the EEC to offer to make concessions, and if so, to sector. It is clear that, like in any substantial tariff concessions should what extent? other country, we cannot simply there be a later round of customs SCHMUCKER: I referred to the put aside the interests of our own reductions within GATT. Could this American Selling Price System al- agriculture. But it would be wrong be the reason why--as some people ready earlier. It probably had its to assume that by our farm policy suspect--the EEC is now being justification in 1922 when the Ame- we are trying to block the negotia- very cautious over customs con- rican dye-stuff industry was only tions in the Kennedy Round. cessions? beginning to be developed; but it On the other hand, I do not wish SCHMUCKER: It is very difficult certainly is no longer justified at a to belittle the difficulties arising to draw a comparison between the time when the US chemical indus- from the fact that there are simul- customs level of the USA and that try is the most powerful in the taneous negotiations on establish- of the EEC. This is because the world. Under this system of valua- ing a Common Market for farm common tariff as a whole has its tion a tariff protection is being products and on offers being made origin in the arithmetical average reached sometimes which is far in to the Kennedy Round. Yet it would of the national customs duties of excess of 100 ~ of the value of the be a crude simplification to regard the EEC member countries. This imported goods. In most cases this these difficulties as solely due to has meant the automatic removal American system is classed as one the EEC farm prices. Though I do of extremely high as well as of of the non-tariff trade barriers. But not overlook the importance of the extremely low tariff rates. At pres- in fact it is so closely linked with question of farm prices, this is only ent the EEC rates centre round an the tariff system .that it cannot be one factor in the negotietions. The arithmetical average of about compared with other measures such various subsidies and other pro- 11.7 o/0. The American tariff, on the as taxes on motor vehicles which, tective measures applied by many other hand, comprises both many though they also interfere with in- countries--not least by the USA-- very low customs duties and quite ternational trade, are not directly also play an important part.