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COMMISSION OFTHEEUROPEAN COMMUNITIES
1
Brussels,IstAugust1975
COM(75)456final
i
/ ;
DECISION OPTHECOUNCIL
concerningtheopeningofnegotiations withtheArabRepublic
ofEgyptfortheconclusionofanagreementforthesupply
ofagricultural products.,
;

EXPLANATORY MEMORANDUM
1.Inviewofthesituationonworldmarketsforagricultural products,
theEgyptianauthoritiesrecentlyapproachedtheCommissiontoexplore
thepossibilities ofmeetingpartoftheirfoodrequirements under
stableconditions .
2.OntheoccasionmquestiontheEgyptianGovernment gavenoticeofits
intentiontoconcludemedium-orlong-termagreementswherebyitwould
undertaketoimportgivenquantitiesoffoodproductsongivenprice
conditions .
Foreachoftheproductslistedbelowthecommitmentsinquestionmay
besummarizedinpracticaltermsasfollows:
-cereals :1,000,000tperyearforthreeyears,
includingatleast200.000tofflour
-v;hitesugar :75.000tperyearforthreeyears
-beefandveal:11,000tperyearoffrozenmeatforthree
years,includingapproximately 1.000tof
cornedbeef
-milkproducts t10.000tperyearofskimmed-milk powder
fortwoyearsthroughcommercialtransactions

2.
•10.000tofskimmed-milk powderforoneyearat
reducedpriceundera"socialprogramme"
•3.000tperyearofcertaintypesofcheesefortwo
years.
Moreover,theEgyptianGovernmenthasalsoshowninterestinimportingfrom
theCommunitymilkproductsubstitutesforuseasanimalfeed.Inpractical
termsthiswouldinvolvepurchasinginthefirstyearatleast5«000tof
theseproducts,inwhichasubstantialproportionofdriedmilkwould "be
incorporated .
3,HavingexaminedtheproposalsoftheEgyptianauthorities ,theCommission
considersthatitisnotpossibletomeetalltheirrequests.However,in
viewofthepresentandforeseeabletrendofCommunityproduction andcon­
sumptionoftheproductsinquestion,andthusofexportavailabilities ,
itvrouldseemdesirablefortheCommunitytoconcludeanagreementonthe
linesindicatedinthedraftdirectivesinannex.Itshouldalsobeempha­
sizedthattheearlyconclusionofanagreementofthisnaturewouldconsti­
tuteapositivestepinthedevelopmentoftheCommunity'srelationswith
Egypt.
4.ForalltheabovereasonstheCommissionrecommendstotheCouncilthatit
beauthorisedtoopennegotiations fortheconclusionofanagreementwith
#
Egyptforthesupplyofcertainfoodproducts,inaccordancewiththedirec­
tivesannexedhereto.
*
**
Itistobeexpectedthatinthenegotiations theEgyptianauthoritieswill
layparticularstressontheirdesiretoobtainincreasedsuppliesofcertain
products,especiallycereals,intheformoffoodaid;theywillalsobe
eagertoestablishfinancialandtechnicalcooperationwiththeCommunity

3.
fordevelopingproductioninEgypt'sagriculture andfisheriessectors
soastoensurethatthedomesticmarketisbettersupplied,
-AsregardsfoodaiditshouldbenotedthataidsuppliedbytheCommunity
anditsMemberStateshasdeclinedconsiderably inrecentyears.TheCommission
considersthatinviewoftheeconomicandsocialconditionsstillobtaining
inEgypttheCommunityshouldgiveanassurancethatanyadditionalrequests
submittedbytheEgyptianGovernmentforincreasedCommunityfoodaid,in
particularintheformofcereals,willbeexaminedwithallduecare.
-Onthesubjectoffinancialandtechnicalcooperationforspecificpro­
jects,itshouldbepossiblefortheCommunitytoagreetothesematters
beingexaminedwithintheframeworkoftheprojectedeconomicandtrade
cooperation agreementbetweentheEuropeanEconomicCommunityandEgypt,
exploringinparticularthepossibility ofsettingupjointventures.

DECISION OFTHECOUNCIL
concerningtheopeningofnegotiations withtheArab
RepublicofEgyptfortheconclusionofanagreement
forthesupplyofagricultural products
THECOUNCILOPTHEEUROPEANCOMMUNITIES ,
HavingregardtotheTreatyestablishing theEuropeanCommunity,andin
particularArticle113thereof;
Havingregardtotherecommendation fromtheCommission ;
WhereastheEgyptianGovernmenthasproposedthatoutlineagreementsbe
negotiatedbetweentheEuropeanEconomicCommunityandEgyptforthesupply
ofagricultural products;whereastheconditionsfortheopeningofsuch
negotiations havenowbeenmet,
HASDECIDED:
SoleArticle
TheCommissionisauthorizedtoopennegotiations withtheArabRepublic
ofEgypttoseekanagreementforthesupplyofagricultural productson
thebasisofthedirectivesadoptedbytheCouncilon and

annexedtothisDecision,subjecttoanyfurtherdirectives.
TheCommissionshallconductthenegotiations inconsultation withthe
SpecialCommitteeprovidedforinArticle113oftheTreaty,whichshall
assistitinthistask.,
Poneat .on
FortheCouncil
ThePresident

ANNEX
DRAFTDIRECTIVES FORTHENEGOCIATION OF
OUTLINEAGREEMENTS BETWEENEGYPTANDTHE
EUROPEAN ECONOMIC COMMUNITY
GENERALOBJECTIVES
Theobjectiveoftheagreementwouldbetoensureforgivenperiodsguaranteed
suppliestoEfeyptofcertainagricultural productsfromtheCommunity#
OBLIGATIONS OFTHEPARTIES
Foralltheproductscoveredbytheoutlineagreements,theEuropeanEconomic
CommunitywouldguaranteetotheEgyptianGovernmentthattheproductsin
questionwouldbeavailableforthedurationoftheagreementandinaccordance
withthedeliveryperiodsdeterminedjointlybythetwoparties#Inreturnthe
EgyptianGovernmentwouldundertaketoimportthecorresponding quantities
followingthesametimetable#
ARRANGEMENTS FORTHECONCLUSION ANDIMPLMENTATION OFOUTLINEPRODUCT
AGREEMENTS
Foreachoftheproductslistedbelow,thetwopartieswouldagreetoconclude
anoutlineagreementincorporating obligations andrulesadoptedjointlyand
detailedhereunder#
1#Cereals
(a)Quantities
TheEgyptianGovernmentwouldundertaketoimportandtheEuropeanEconomic
Communitytosupplyforthe1975-76marketingyearaquantityofapproximately
1milliontofwheatorwheatflour-includingatleast200000tofflour-
meetingthetraditionalspecifications forEuropeanexportstoEgyptianmarkets

("b)Priceconditionsand,timetablefordelivery
The1975-76marketingyearwould "beginon1August1975*Theplanwouldbefor
aquantityequivalenttotwo-thirdsofthetotalcommitmentsto"bedeliveredby
1March1976*InanyeventtheEgyptianGovernmentwouldundertaketoacceptat
least50^ofthisquantityduringthereferenceperiodinquestion,andthe
remaindershouldbeimportedinthesixmonthsfollowing1February1976#
Thetwopartieswouldagreetotakeallappropriate measurestoenabletraders
tocarryouttheirwheatdealingswithinapricebracketcomprisingaminimumof
US^120andamaximumofUSf>175*
Hiepriceoftheflourwouldbedeterminedbyreferencetothepriceofthewheat,
withaccountbeingtakenofthetechnicalspecifications ofthetwoproducts#
2•Whitesugar
(a)Quantityandtimetablefordelivery
TheEgyptianGovernmentwouldundertaketoimportandtheEuropeanEconomic
Communitytosupplyeachyear,forathree-yearperiodbeginningon1July1975»"j
quantitesofwhitesugarequivalentto75000t•
Thedeliveryperiodforthefirstyearoftheagreementwouldcommenceon
1October1975*
(b)Priceconditions
Thetwopartieswouldagreethatduringthethree-yearperiodpurchasesonthe
Communitymarketshouldbemadewithinabracketwheretheminimumandthemaximum
correspondrespectively totheCommunityintervention priceandtargetpricelevels
expressedfobCommunity. I
Forthecurrentmarketingyear,thebracketcomprisingthefobtargetandinter­
ventionpricesisbetween336*5and320.5u.a.pert.
3.Frozenbeefandvealandcornedbeef j
(a)Quantities
TheEgyptianGovernmentwouldundertaketoimportandtheEuropeanEconomic
Communitytosupplyfopthe1975-76marketingyearapproximately 11000tofthe
frozenbeefandvealandcornedbeef,includingapproximately 1000tofcorned
beef.

FrozenmeatexportedtoEgyptwouldhavetomemeatfromanimal>notmorethan
threeyearsold,exportedintheformofcompensatedquartersmeetingthe
traditionalspecifications forEuropeanexportsofmeattoEgypt#
(b)Priceconditionsandtimetablefordelivery
TheEgyptianGovernmentandtheEuropeanEconomicCommunitywouldtakeall
appropriatestepstoensurethatthefrozenbeefandvealcouldbeexported
toEfeyptbyprivatefirmswithinapricebracketcomprisingaminimumofUS800
andamaximumofUS$85Opert•
Themarketingyearwouldbeginon1August1975*
4#Milkproducts
Thetwopartieswouldagreetoconcludelong-termoutlineagreementsinrespect
ofthefollowingproducts:skimmed-milk (10000t),butterandbutteroil
(10000t)andcheese(3000t)#
(a)Skimmed-milk powder
Thetwopartieswouldagreetoestablishatwofoldprogrammeforskimmed-milk
powderimportstoEgypt:
(i)along-termoutlineagreementforimports,spreadovertwoyearsandcovering
10000tofskimmed-milk powderforhumanconsumption ,atfobpriceswithina
bracketrangingbetweenaminimumof$630pertandamaximumof650per
t#Itisunderstoodthattheseproductswouldbeoftopquality(for
intervention );
(ii)thesecondprogrammeissetoutindetailinthechapteroftheagreement
relatingtofoodaid.
(b)Cheese
Thei^yptianGovernmentwouldundertaketoimportfromtheEuropeanEconomic
Communityanannualquantityof3000tofcheeseoftheCheddar,Goudaand
Edamtypefortwoyears#
TheEuropeanEconomicCommunitywouldtakeallappropriatestepstoensurethat
theofferpricesforexporttotheEgyptianmarketarewithinthebracket
&1000-1I50pertforthequantityindicated#
ItisunderstoodthatindealingswithE&yptthetargetandintervention prices
mayundernocircumstances beaffectedeitherbyexportrefundsorbylevies#
-3- ./

MILKPRODUCTSUBSTITUTES FORUSEASANIMALPEED
Inordertomeetpartoftherequirements oftheEgyptianmarket,the
EuropeanEconomicCommunitywouldundertakeforthefirstyearofthe
Agreementtodeliveratleast5«000tofmilkproductsubstitutesfor
useasanimalfeed.
Thecompositionoftheseproductswouldnormallyheapproximately 50$
driedmilk,15^powderedwhey,20fovegetableoilsandfats,plusminerals
andproteinsofvariousorigins.

V. FOODAID
(a)InviewofthegeneraleconomicsituationinEgyptasregards
food,theCommunityshouldbeabletoindicateitsintentionto
examinewiththeutmostcaretheEgyptianGovernment'sadditional
requestsforanincreaseinCommunityfoodaidtoEgypt,inparticu­
larintheformofcereals.
(b)Programmeforthesupplyofskimmed-milk powder
Furthermore ,thetwopartieswouldagreetoestablishaone-
year"socialprogramme"forthesupplyof10000tofskimmed-milk
powder.
1Suppliesunderthisprogrammewouldbeconditional uponthe
introduction bytheEgyptianGovernmentofaspecificschemeforfree
distribution tothoseinneed.
TheCommunitywouldundertaketochargeapriceof350fobpert.
FollowingtheirpurchasebytheEgyptianGovernment,thesupplies
wouldreachEgyptviahumanitarian organizations designatedbythe
EgyptianGovernment.
AttherequestoftheEgyptianauthorities ,deliveriesunderthis
programmecouldbemadeattherateofupto1000tpermonth.
-5-