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DOCUMENTS "COM"
COM(80)380
Vol.1980/9007

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/ COM(80)380 finalBruxelles ,le
COMMISSION 2JuLy1980
DES
COMMUNAUTES EUROPEENNES
Secrétariat général
14»
NEGOTIATIONS FORTHEACCESSION
OFPORTUGALTOTHECOMMUNITY
AGRICULTURE
^(Communication fromtheCommission totheCouncil)
C0MC80)380final

PART1
Introduction •
1.On20February 1980atthe7thSessionoftheConference thePortuguese
tabledafirstdeclaration onagriculture .(Conference document
P/14/80of25February 1980).Thisdeclaration presented ageneral
pictureofthestateofPortuguese agriculture ,andoutlined thebasic
approach ofthePortuguese Delegation totheagricultural chapterinA
thenegotiations .
2.Sincelastyeartwoparallel andcomplementary exercises havebeenin
progressandarenearingcompletion,directedtothedetailed^nd
intensiveexamination withthePortugueseauthorities ofttj^problems
intheagricultural sector.Thesearethesecondarylegislationexercise
(throughwhichthePortuguesearemadeawareofprecii^ywhatthey
mustundertake toaccept)andthesectorial analysis ofthepresent
Portuguese system(throughwhichbothpartiesdeveloptheirawareness
ofwhatchangeswillberequired).Thelat^fcexercisehastaken
placeonthebasisofPortuguesereplies^sjSme ofwhicharestilL
beingclarifiedbysupplementary infog^f&ion)toalengthyCommissionquestionnaire submittedinDecember^79.
3.Theproblems arebeingreviewed bothintheirsectorial detailandin
theirinter-relationships ^£«eenonesectorandanother.Theoptions
forthesolutionofsucl^^hoblems willhavetobecarefullyappraised
notonlyinrelation^S^theirpossibilities ofapplication inthe
%>Portuguese economybutalsoinrelation totheirpossible repercussions
intheCommunity .
A
4.Toachiev^sgrcarefulandpreciseidentification oftheproblems,todevelonj^he appropriate solutionstothem,andtopresenttheresults
oftfwtworktotheCouncilintheformofaproperly balanced and
integrated setofproposals will'takeuntiltheautumnofthisyear.
Aswellasdeveloping appropriate sectoral solutions,theCommission
4^$^willalsohavetoevaluatetheplaceofPortugueseagriculture inthe
^generalPortuguese economyandthelonger-term possibilities forthe
development inPortugal oftheagricultural sector.
5.TheCommission is,however,inaposition topresent apreliminary
appraisal ofthestateofPortuguese agriculture ,whichlimitsitself
toindicating thegeneralnatureoftheproblems whichwillhavetobe
facedifPortuguese agriculture istobesuccessfully integrated into
thatoftheCommunity .

-2-
ThePortuguese declaration of20Februaryrefersinsomedetailtothe
disparities betweenPortugal'spresentsystemandtheCAP.These
CAdisparities arebroadlyoftwokinds/firstlyinthestructuralconditions ^inwhichagricultural production takesplaceandsecondly-inthemarketidrts ^"
cvarrangements wherebytheproducereachestheconsumer.Theyareexaminee !
inthecontextofabriefdescription ofthecurrentagricultural situation
inPortugal whichfollowsinPart.IIbelow. .

PART II
-3-
General characteristics ofPortuguese agriculture
6.Thegeneral characteristics oftheagricultural sector were summarised
asfollows byPortugal 'ssecond constitutional government in1978 :
«
Portuguese agriculture possesses alowlevel ofproductivity ;it
utilises mainly land and labour asfactors ofproduction ,working
with both inpoor financial andstructural conditions andwith ase­
rious lack ofcapital andtechnology .Ingeneral thesector practises
adefensive formofproduction whichleadstotheunder-uti li^^on of
natural resources andtothepredominance ofsubsistence f^^ng ."
(Programma doIIGoverno Constitucional ,2.1.).
7.Portuguese agriculture wascharacterised byrelative stability atlow
levels ofproductivity prior totheevents of1974 ,since when ithas
declined ,despite thebest endeavours oftheGovernment ,both inabso­
luteterms andrelatively tothenon-agricul^Sral sector ,asthefollo­
wing table illustrates :
Table 1.Labour productivity (1963 prices ,000esc/worker )
Year Agriculture &$&>n-agri culture sector£Economy overall
1970
1973
197620.2
23.7
21.446.8
61.9
65.639.3
52.2
54.1
(Souu&r :INE )
8.Attheroot ofthis situation are ahumber ofstructural limitations ,
which maybeidentified asfollows .
hestructure ofholdings
9.There isamarked North /South distinction inthe -characteristic type of
farm holding .Inthenorth ,farms aretypically small ,fragmented and
owner-occupied .Inthesouth ,while there isalso aproportion ofsmall

farms,thelargeestatepredominates .
«
10.Thefiguresofthe1968censusaretheLatestfiguresavailable.They
areencapsulated belowinTable2:
StructureoffarmholdingsinPortugalbyregion.1968
North Total
A
Under4ha 78.9
4ha-20ha19.0
20ha-50ha1.8
50ha-100ha0.2
Over100ha 0.1
Total('000) 247.0
Under4ha 46.1
4ha-20ha43.8
20ha-50ha1.5
50ha-100ha0.5
Over100ha 8.1
Total('000ha)824.8
HectaresCentreLisbon •south
region
-Numberoffarms,%
•82.278.2 56.8
15.918.5 30.9.«Ν18.7
1.42.06.β§*2.1
0.30.6 25810.5
0.20.7^.40.5
370.2115.2 83.7816.0
B-Area.%
25.91&93.618.3
34.4c^K.19.422.8
11.39.4 •6.99.7
5.6çg^6.95.55.7
22«^45.763.543.5
127^8722.22334.85159.7
C-Averageno.oflandparcels
6.2J$M 7.744.063.5
-Averageareaperfarm
°3.34 3.456.2727.96.35
6.32«
(Source:INE)
11.ItwillI^Jreeenthatoverthecountryasawholethe0.5%offarmswhich
wereov^"100haaccountedfor43.5%ofthelandarea,whileattheother
extremethe78.2%offarmswhichwereunder4haaccountedforonly18.3%
ofthelandarea.Oftheselatter,abouthalfwereunder1ha.
<$"Expressedinanotherway,thetotalnumberoffarmswas816000,ofwhich
"some300000wereunder1ha.
S

12.This situation isexacerbated bythehigh degree offragmentation
which isanimportant feature ofPortuguese farm structure ,andwhich
ismost preponderant inprecisely those regions where thefarms are
smallest .Theaverage number ofseparate parcels ofland per farm is
about 7(intermediate between Greece andSpain )andtheaverage size
ofparcel isnomore than 0.4ha. *
13.Inthenorth ,thefragmented nature and small size ofholdings isre­
flected inthelarge number ofpart-time andelderly farmers inthis
region . A.
14.Inthesouth ,land tenure prior to1974 wascharacterizaA&y thepre­
dominance oflatifundia ,relying largely onpaid manages ,tenant farmers
anddaily labourers without anyland oftheir own .Theevents of1974 and
1975 ,therepercussions ofwhich arestill unresolved ,radically changed
thisownership structure without yethowevei^j^ving mucheffect onthe
size-distribution ofholdings .Byandlaj^ipthe oldlatifundia simply
became large cooperative orcollectiv^^arms runbytheir former
tenant farmers andlabourers ,whoas^et arelargely lacking in
managerial skills andcapital resources with which todevelop them .
THE AGRARIAN REFORM LAWS
15.Theconstitution ofthePortuguese Republic defines thefundamental
principles ofagrarian reform ,which imply important social "and
economic cl^iges .Thelegislative measures fortheapplication of
thesepj^&iples entered into ,force insuccessive stages in1975 ,1976
and .
16.Themost significant aspect ofthereform relates totheexpropriation
^andreallocation ofthelarge estates inthesouth (intheAlentejo
region ).

5017.Holdings ofless than 30haarefree altogether from expropriation ,
while theowners oflarge estates haw theright toreserve a
proportion oftheir lands intheir ownownership ,provided they farm
itdirectly themselves .Asomewhat complicated points formula (which
balances fertility against area )limits theamount available toeach
owner ofsuch reserved lands toamaximum of500 haofnon-irrigated
land ,or70haofirrigated land ,oranappropriate ,intermediate
figure iftheowner wishes toretain both types ofland .
18.Theremaining lands areavailable forredistribution ascollective
farms operated directly bytheir workers ,ascooperatives ,or^•indi­
vidual family enterprises ofreasonable size (oftheorder^j^S30to50
ha).
19.Besides providing fortheredistribution ofland ,theagrarian reform
laws provide also for arange ofgrants ,subsidies andcredit facili­
tiestostimulate andspeedthedevelopment ^j&henewfarmenter­
prises thus created .
20.Finally ,itmust benoted that theagrarian reform isasyetonly in
theearliest stages ofwhat will inevitably beaslow process .Quite
clearly ,there willbeimportant long-term consequences ofasocial
andeconomic nature ;but present time itisnotpossible to
evalute themwithanyi^if&onable degree ofprecision .
LAND USE AND CLIMATE
21.Thetot^i^Sand area ofPortugal is9,164,000 ha,ofwhich just under 9
millio!$$iia constitutes "continental "Portugal ,andthebalance is
taken upbytheislands ofMadeira-'and theAzores .
The 9miohaofcontinental Portugal falls roughly into thefollowing
use categories :

Cropland (annual crops ) 3.0mioha
Cropland (permanent 'crops ) 0.6mioha
Permanent pasture 0-6mio ha
Forest +woodlands 3.6 mio ha
Unused (mountains etc.) 1.2mio ha
9.0 mio ha
However ,ofthe3.6million haofland under crop atthetime ofthe
1968 census ,only some 2.6million haisregarded astrue crop land -
thus indicating that about 1million haofmarginal land isbeing
cropped which should properly beused inadifferent manner .^
Tobenoted alsoisthewidespread practice offallowing ,^®lchcon­
siderably reduces theamount ofcroplandeffectively ^^Llable inany
particular year .
Crops produced
23.Thecrops produced inPortugal cover Spenormal range oftemperate and
Mediterranean products -cereals ,meat anddairy products ,fruit and
vegetables ,olive oilandwine .
There are,however ,twosigj^^icant differences fromthenorm :<#
namely thevirtually tot^J^bsence ofproduction ofsugar andtobacco
(cropshistorically r^^Vved forproduction inthePortuguese colonies );and
theimportance offorestry products (ofwhich Portugal isanetexporter ,
exports ofthese products amounting in1978 to20%oftotal .Portuguese
exports ).
The islandsvfcr Madeira and the Azores
24.Theagricultural economies oftheislands aresomewhat differentiated from
.mainland Portugal .TheAzores arecharacterised byamuch more marked relative
dependence ondairy products ;while Madeira 'swarmer climate permits the
^ growth ofcertain sub-tropical products ,particularly bananas ,and
some sugar-cane .
Both islands have aconsiderable measure oflocal autonomy within the
political structure ofPortugal asawhole .One oftheside effects ofthis is
aneven greater scarcity ofup-to-date andaccurate statistics than that which
characterises mainland Portugal .

-8-
Irrigation
25.Therole ofirrigation inPortuguese agriculture isimportant ,though perhaps
more sointerms ofpotential than ofachievement .In1976 ,thearea under
irrigation was some 700000ha,orabout 14%ofthecultivated land (Source :
World Bank ).About 90%ofthis area issmall scale traditional irrigation \
inthemountainous andcoastal regions ofthenorth *relying onsurface watey'
fromstreams ;unfortunately thesetendtodryupjustwhentheneedfor^^
irrigation water ismost critical .The remaining irrigable land isdistributed
among 19projects constructed bytheState since 1935 ,mainly inthesouth .
However ,these have notbeen utilised totheir full potential ,Ajr avariety
ofreasons generally connected with limitations ofadministcraive and
technical skill andshortage offinance ;in1974 (thelas^S^ear forwhich
detailed records areavailable )onlyhalfofthese lancS^were actually
irrigated .
Agricultural labour force =#
26.Aselsewhere inEurope theagricultura^^rabour force inPortugal hasfallen
over recent decades ,asisshown inti&table below :
Table 3:Relationship ofagricultural employment tototal employment
Year
1960
1975
1976
1977Total
population
('000 )
8.851
8.947
9.123
9.168
9.204Employment
Total
('000 )
3.284
3.734
3.820
3.731
3.808Agricultural
(•000) •
1.445
1.265
1.286
1.228
1.170Agricultural
employment as
percentage oftotal
employment
%
44
33.9
33.7
32.5
30.7
(Source :Eurostat )

27-Thedecline intherural labour force waspart ofageneral process of
internal andexternal migration ,including substantial movements
towards theformer Portuguese colonies inthesixties .This colonial
movement wasreversed after 1974 bythereturn ofmany ofthe
colonists asrefugees ,butemigration (particularly toCommunity
countries )remains animportant factor .
28.Despite thefact that some ofthereturning colonists brought back
money andskill into theagricultural sector ,thenetresult ofall
these factors hasbeen thedepletion ofthequality aswell as the
quantity ofthemanpower resources oftheagricultural sectai£"rhe
rural population that hasremained behind isingeneral trerolder and
theless skilled group .Atthe1968census ,45%offathers were over
55years old ,44%were illiterate ,andonly 1%hadreceived any
education beyond theprimary level .
OTHER STRUCTURAL ASPECTSUIXIXUJAoiAuui uivrtj_inoriiuij rv;
" #
29.Thegeneral under-development ofPortuguese agriculture isreflected in
symptoms such asavery lowlevel ofmechanisation andoftheuseof
artificial fertilizers .Mo^particularly ,fromthepoint ofviewof
applicability ofCommun^^common agricultural policies ,itisalso
reflected inamarked^bsence offarm accounts (which makes it
difficult toassess standard costs ofproduction )andinvery
localised marketing arrangements formost products (which makes it
difficult toc&Drm anappreciation ofgeneral market price levels ).
Except ii^pertain specific sectors ,suchaswine ,producer coopera­
tives,^'other forms ofproducer group associations arera-rely tobe
found .
3(^,Inaddition tothese handicaps ofaspecifically agricultural nature
istobenoted under-development ofthegeneral infrastructure onwhich
S themodernisation ofagriculture depends ;andthis applies notonly to
roads ,electricity andwater supplies etc.,but togeneral education and
toprofessional training andservices (especially agricultural advisory
services .)

-10-
PRODUCTION ,CONSUMPTION AND TRADE INAGRICULTURAL PRODUCTS
31.Portugal hastraditionally imported andexported agricultural products
onaconsiderable scale .Inthepast this wasusually roughly inba­
lance .Inrecent years ,however ,this balance hasvery seriously dete­
riorated through amassively increased import requirement .This ^
quantum change isexemplified bythefollowing figures :in1963 /65,
Portuguese exports ofagricultural products provided 100%coverage
foragricultural imports ;in1973 /75this ratio wasdown to45%.The
ratio remains inthis order ofmagnitude .
32.Essentially ,this isduetoastagnation -even adecline^&fi some
sectors -indomestic agricultural output ,arising outoftheinhibi­
ting factors referred tointhepreceding paragraphs ,while domestic
demand increased sharply because oftheevents <^j^l974 .Withthe
decrease ofemigration andthereturn ofref^*?es fromtheformer
colonies ,themainland population increas^^in thatyearbysomehalf
amillion people (asudden increase ofaftout 6%inthepopulation ).
Concurrently ,therise indisposable personal incomes which occurred
during theperiod ledtoincreased consumer spending onfood gene­
rally ,andonhigher quality ^^dinparticular -ashift ,asitwere ,
fromthedirect consumpti^§&f vegetable products totheconsumption
oftheir more costly deiS^atives intheform ofanimal products .
33.Domestic agriq^jkure wasquite unable tomeettheincreased demand forcereals
andproteii^j^dder cropsrequired fortheintensive animal production
developm^jS ^needed tomeetthissituation .Thisconsequently generated a
sharp increase ofcereals imports ,particularly ofmaize from theUSA .In
addition there were increases ofdirect imports ofanimal products ,parti­
cularly ofbeeffromtheArgentine ,tofillthedeficits which still remained .

-11
34.Thefollowing table illustrates these changes :
Table 4.Production ,imports andconsumption ofcertain keycommodities
(Continent ,nearest 000tonnes )
(1)
1Commodity '
1 t
f 1
t(2)
Year!
(3)
1 Production
t
»t
(4)'·
1Imports
t
ft f
(5) ¿
1 Consumption
' availability '
((3)+(4))
'Wheat '
1 »
« (1970
1974
1978540
534
• 250341
1322
'820^881
'<#856
1070 ·
'Maize '
r t
ι »1970
1974
1978581
486
449'321
986
17<d^• 902 1
' 1472 '
' 2218 ·
'Sorghum 1
1 f
*–– '1970
1974
1978 6# 22
376
307' 22 '
376
313
f ..1
■Beef(6)'
» 1
f 1
t f1970
1974
1977<¿T87
85
» 845
36
401 92 ·
' 121 '
' 124 ·
'Pigmeat (6)'1970
•^74
1978' 57'
• 70
.117
f4*
1261
82
• 117
f t
<MSource -1970 and1974 :INE )
( 1978 Portuguese official sources )
Footnote (6):Live animals excluded .

12-
35.Itisnecessary tonote atthis point that Portuguese import demands arethe
result ofGovernment decisions connected inter alia with the balance of
payments siLuation andoperated ,inthecase ofthemajor agricultural
products ,through thestate trading systems described inparagraph 40below .
Whether these levels ofimports correspond tothetrue potential demand ina
free market trading system remains onopen question .
Balance ofpayments
36.Theconsequences ofthehigh levels ofimport demand onthePortuguese balance
ofpayments have been particularly damaging ,astable 5below shows :
Table 5.Portugal' sagricultural trade (1)(mióUS3)
: ^
Imports
Exports
Balance(2)
1967-69
176.0
137.4
-38.6(2)
1970-72
257.5
171.4
-86.11973
443.4
272.91974 1975
^5>r7 1806,4
,<&78.2 1276.28#Τ7
£
-170.5^-640.5 '-530.21976
776.0
255.1
-520.91977
826.1
261.3
-564.8
(Source :0ECD )
c#Note :(1)Agricultural trade defined asincluding chapters 0(except
fish 03)1,22,29and4oftheSITC .
(2)Average .
Whether Potjphgal 'sfuture imports come from inside oroutside theCommunity ,
theba^i^te ofpayments costislikely toremain highunless domestic
production isincreased . •'
Pof^yguese trade with theCommunity
36bis .Portuguese trade with theCommunity inagricultural products in
recent years issummarized inTahle 6below .

Table6-12bis-\%
Portuguese tradewiththeCommunity inagriculural products
intermsof(1)value(Mioecu)and(2)percentage oftradewithworldasawhole
AnnexIIProducts
Chapter Title%%
2Meatandediblemeatoffals
3Fish,crustaceans +molluscs
4Dairyproducts ,eggs,honey
5Otheranimalproducts
7Ediblevegetables androots
8Ediblefruitsandnuts
9Coffee,teaandspices
10Cereals
12Oilseeds &oliginous fruits
15Animal &vegetables fats&
oils
16Preparations ofmeatorfish
17Sugars &sugarconfectionary
20Preparations ofvegetables
orfruits
22Beverages ,spirits &vinegar
23Residues fromfoodindustries
24Tobacco
45Cork
TOTALS1976
Ltmports from
03)EEC9(2)
13.4
2.9
3.8
η.
17.0
η
0.4
11.9
2.3
1.5
η
5.4
η
η
9.1
0.6
68.323i
1
5
2
10
η
η
23
5Exportsto
(1)EEC9(2)
η
1.5
η
3.3ψ
η
η
1.6
24.1
η
15.0
56.2
η
η
2.5
111.1η
25
η
65
40
43
η
η
η
21
52<fe
n'
26 :
53
η
η
28
431977
Imports from
(1)EEC9(2)
7.0
1.3
4.9
η
30.1
η
0.2
•3.8
2.0
2.8
ληV3%Λ
11.0
0.7
65.1(1)EEC
12 η
21.9
58 η
η3.7
652.2
η7.2
η η
2 η
2 η
15 1.6
η30.3
2 η
η21.8
η65.4
17 η
6 η
2.2/ν
91<)78
stoImports fromExportsto
9(2)(1)EEC:9(2)(1)EEC9(2)
η1.4 7 η η
270.5 12.329
η5.677 η η
64 η η5.5 75
356.4702.3 24
55 η η6.753
η0.5 2 η η-
η16.7 6 η η
η2.1 2 η η
Τ61.5 81.0 10
58 η η35.3 60
η8.3 18 η η
43 η η7.5 20
56 η η77.9 61
η11.2'19 η η
η1.2 9 η η
28 2.847
5055.4 9141.7 51
Footnote :n=nilornegligible
%X

Agricultural levies
1
37.Atthis point itistobenoted that thedeficit import /export balance on
commodities subject tothemarket regulations ofthecommon agricultural
policy would also imply thepayment ofsubstantial agricultural levies into
theCommunity budget .
38.Itisneither opportune norpossible atthis stage toestimate these payments
inanyprecise way .The rates oflevy will bedetermined intheevent by
future andunpredictable differences between worldmarket price^jjhid Community
prices forthecommodities inquestion ;thequantities towhj^^they would
apply willlikewise depend onfuture levels ofPortuguese /^fc^orts andthe
distribution ofthese between Community andnon-Community sources ofsupply .
PL480trade with USA . '
39.Afurther factor tobeborne inmind ,inasgrcsing thefinancial implications
forPortugal ofshifts inheragricultu^-B^trading pattern ,isthatnotonly
istheUSAtheprime source ofsupply (about 90%ofthetotal )forcereals
imports ,butthat animportant proportion ofsuch supplies benefits from
concessionary trade arrangemenl ^under PL480 .In1979suchconcessionaryarrangements wereauthorised^^r 80000tonnes ofwheat and186000tonnes of
maize and/orsorghum .
Internal marketing system
40.Theprinciafcjr commodities -cereals ,livestock products ,wine ,olive oil -are
organiset&knd controlled through whatareineffect State tra'ding bodies (the
juntas ).There isnopoint ,forthe'purposes ofthepresent exercise ,in
analysing their structures separately andindetail .Suffice ittosaythat
<<^heyallreflect acommon approach :thefixing ofproducer prices at
sufficiently remunerative levels ;thefixing ofappropriate transformation and
^ handling margins right tothepoint offinal pale ;intervention arrangements
tounderwrite themarket andtotake domestic production off Ihemarket if
surpluses occur ;thecontrol ofimport andexport operations with thedual aim
ofpreventing domestic surplus situations from arising andofminimising the
balance ofpayments costs ofsuch imports asmaybedecided tobenecessary .

-14-
Consumer subsidies
41.Since theprice andmargin-fixing operations referred tointheprevious
paragraph characteristically result inhigher prices than theGovernment has
been prepared toimpose onconsumers ,thesolution adopted hasbeen toinject
consumer subsidies intothefinal price ofbasic foodstuffs .These subsidies ^*
have been substantial .In1978 ,at12.4 billionf escudos ,they represented ^
6.9%oftotal Portuguese budgetary expenditure .Itmaybenoted that t4^
cost offood isavery important item intheindividual Portugese consumer 's
expenses :expenditure onfood is50%oftotal consumer expenditure ,twice
theCommunity average .
Price levels
42.Itisdifficult ,andindeed maybemisleading ,togeneralise about price
levels inPortugal ascompared with those intheCommunity ,allthemore so
since thesectorial examinations arenotfiigS^Lsed inthisregpect .However ,
subject tothis general reserve ,thesitiu&lon maybesummed upasfollows .Jr
Apart from thegeneral difficulty offinding truly comparable price points ,so
that one isgenuinely comparing like with like ,thegeneral situation isvery
fluid .Thismayperhaps best^be characterised bysaying thatwhereas ,inthe
past ,Portuguese producer ^j^ces weregenerally lowerthantheirCommunity
equivalents ,thehigher^^eofPortuguese inflation hasalready brought them
tolevels which arenStomostly ofasimilar order ,orinsome cases even higher .
Clearly ,anyfuture variations inexchange rates will also have an
immediate anddirect effect onthecomparability ofprice levels .
43.Consume i^wrice levels -with similar reserves about thedependability of
genera^3fcomparisons -tendatpresent onthewhole toberather lower thanin•
theCommunity .
44.ThePortuguese government isofcourse conscious ofthedisparities between
theexisting system described above andtherequirements inthese sectors for
adaptation totheCommunity system .Ithastherefore already begun agradual
adaptation process ofreducing therole ofthejuntas andincreasing the role
ofthe market forces .

-15-
45.However ,this isaprocess which cannot behurried tooquickly anditwill
clearly take aconsiderable time before theharmonisation process could be
completed .
S&S*
S/

-16-
PARTIII
Preliminary appraisal oftheCommission
46..Althoughthesectorialexamination andthesecondarylegislation exercisear^
notyetcompletedtothestageatwhichtheCommissioncanputforward4^^
itsproposals forthenegotiations /enoughisknowntoevaluate the
Portuguese claimthattheywillhavetofaceandovercome majorproblems
ofadaptation .
47.Itisquiteclear-aswasindeedforeseenintheOpiniono^Portuguese
accession-thattheproblemsareimportant :andcomplex^^^th atthe
mechanical andthepoliticallevel,andthatasubstaq^altransitional
periodwillhavetobeprovided toenablePortugal toadapttotherequire­
mentsoftheacquiscommunautai re.Atoorapidadaptation wouldrisk
imposingveryconsiderable strainsonPortug^3ithrough ,inparticular,
higherimportcostsresulting fromthearafcftcation of.Community prices
andstresseswhichmightwellalso^evelop atthelevelofconsumers
incaseswheretheabolitionofconsolersubsidiesledtoabruptprice
risesintheshops.
48.ThePortuguese Delegation^$erredintheirdeclaration of20February
tothenecessityforphai^aperiodsoftransition,bywhichtheymean:
(a)actionspossibl^Joefore accession (andheretheyrefertotheir
proposals for"commonactions");
(b)shortandmedium-term adaptations afteraccession (mechanical adjust-
ment^s&theirsystem);and ••
(c)jjj^s^umtolong-termadaptations(referringtoinvestmentprogrammes,
^!hepursuitofsocialandeconomicstabilityintheagrarianreform
zone,andsoon).Theyalsomadereference totheneedtoadaptthe
Community'scriteria forfarmstructure improvement tothemore
ax*difficult conditions existing ;inPortugal;tothepossibility ofa
tneimportance ofgeneralregional development policyasaback-uprenewedapplication oftheMediterranean package"concept:andto
toagricultural development .

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49.TheCommission wouldmakethefollowing commentsonthePortuguese
declaration atthisstage:
(i)Asfarasthecommonactionsreferredtoat(a)aboveare
concerned,theCommission hasmadeacomprehensive proposal
<3#totheCouncil(C0M(80)280finalof12June1980)recommending^^*
aidonthebasisofaprogrammewhichthePortuguese putto
theCommunityatthemeetingoftheEEC/PortugalJointCommittee
on30April1980,andsubjecttotheapprovalbythe^ompetent
Communityauthoritiesoftherelevantspecificpro^^s.
(ii)Asregardstheshortandmedium-termactionsa^yCb)above,
thesemechanical adjustments ofthePortuguese systemneedto
betailoredtotheindividual characteristics ofeachsectorof•
thePortugueseagricultural economy^oncerned;buttheircompati­
bilitywithadjustmentsenvisagec^^*theotherapplicantcountry
mustalsobeassured.-Thus,apreliminary assessmentof
theirnaturemaybebeguna^jj&Gonasthesectorialexaminations
arecompleted,theirfinaldetermination willtakemoretime.
Thejudgmentmayalreadybemade,however,thatsuchadjustments
willhavetheirma^impactinPortugalitselfratherthanin
theCommunitya^^^whole,theshareofPortugueseagricultural
productioni^^felationtototalproductionintheenlargedCommunity
beingsmall^*
(iii)Themediumtolong-termadaptations referredtoat"(c)aboveare,
hq^Ver,ofverymuchwiderimplication;and,whileitisclearthat
solutionsadoptedmustrelatecorrectlytoPortugal'scase,it
isaxiomaticthattheymustconformtotheneeds'andconstraints
applicabletoaCommunit/'ofTwelve.Itis,indeed,underthislast
headingthatthemaindifficulties maywelllie.
\

18-
Recommendations x rcecummenaac îuns <^
RA • .I _ i J.I *S • • A.I . I* .• . <l\ .50.Inthese circumstances theCommission proposes that apreliminary st^gment
should bemade inthenegotiations which none the less makes certain things
clear :,namely ,that theCommunity proceeds from theassumption that
Portugal accepts theacquis communautai re;that theCommunis acceptsAV
theneed for atransitional period after thedate ofacce^sfcron toallow
cS fortheorderly application Ofsuchadaptations asmay^nl benecessary ;
andthat itiscommitted toengage inthedetailed rtf&otiation ofthese
adaptations intheagricultural sector assoon asthenecessary technical
foundations have been sufficiently established .