With permission, I should like to make a statement about the latest developments in the GATT Uruguay round of trade negotiations.
As many hon. Members will have heard, the European Commission and the United States Government announced on Friday that they had reached agreement on the remaining issues separating them in the negotiations. Those included key points in the GATT agriculture agreement, and the separate but related trade dispute over Community support for oilseeds production.
That is excellent news. It opens the way to a full GATT agreement between all 108 parties to the Uruguay round. Most immediately, it removes the threat of an imminent trade war with the United States over oilseeds.
I should like to congratulate the two Commissioners directly involved, Mr. MacSharry and Mr. Andriessen, as well as the United States negotiators—Mr. Madigan, the Agriculture Secretary and Mrs. Hills, the United States Trade Representative. I should also pay tribute to my right hon. Friends the Prime Minister, the Foreign Secretary and the Minister of Agriculture, Fisheries and Food, who have done so much to work for the agreement.
The main features of the agreement were, on agriculture, the cutting of quantities of subsidised exports by 21 per cent. and on oilseeds, a limit on the area under cultivation. We have still to see all the details, but it would appear that a GATT agriculture agreement on those lines will be broadly consistent with the reforms of the common agricultural policy regimes agreed by the Community last summer. The Commission will be preparing a report on compatibility with CAP reform.
That is in any case just one of the whole package of Uruguay round agreements. The results should be judged on the balance between all the elements. The Council of Ministers will take a final decision on whether to accept the deal when all the elements are in place.
Talks will be restarting in Geneva this week so that the other 95 participants in the Uruguay round can consider what has been agreed. I believe that it is possible to complete the negotiations this year and we will be urging all parties to reach a conclusion as soon as possible. Apart from agreeing the necessary changes to the agriculture text tabled by the GATT director-general, Mr. Dunkel, at the end of last year, there remains a great deal of work on other aspects of the Uruguay round negotiations.
Negotiations on liberalisation of trade in services and tariff reductions have to be completed. Much work had already been done on this and was waiting for a final resolution on agriculture. Final agreement is needed on the establishment of a multilateral trade organisation and a single dispute settlement system covering all the GATT agreements. Legal texts must be finalised for all the agreements—not only agriculture, services and tariffs, but intellectual property and investment, textiles, antidumping, subsidies and a whole range of other GATT rules and procedures. This is a formidable agenda much remains to be done.
Completion of the negotiations this year would meet the target set by the Munich G7 economic summit, and by the Birmingham European Council. It would enable texts to be ready for presentation to the United States Congress before the 2 March deadline under their "fast track" approval procedure.
Let me remind the House what that will mean. It will mean perhaps $200 billion extra yearly output for the world by the end of this decade. It will mean improved opportunities for our exporters. It will mean that we are able to take advantage of increased trade in services. It will mean that our inventors and artists have a better protection for their intellectual property—it has been estimated that the United Kingdom record industry alone loses £1 billion a year through piracy. For developing countries it will mean western markets being more open to their agricultural and textiles products. The gains to them from increased trade could exceed the total western aid budget.
In short, this is a good deal—for the United Kingdom, for the European Community, for the United States, for the developing countries, and for the world. With determination and good will on all sides, I believe that such an agreement can be reached by the end of the year. I hope, therefore, that the whole House will join me in welcoming the achievement of the Community and the United States.