The French Plan - Blueprint for World Trade Without Tears?

The French Plan proposes a series of international commodity agreements providing for price discrimination between economically advanced and backward countries. It was developed initially as a consequence of the particular set of price support measures adopted in the E.E.C.'s Common Agricultural Policy, but, after: extension and modification, has been put forward as offering a solution to various problems of international trade in agricultural commodities including disposal of agricultural surpluses, the reconciliation of divergent interests in the United Kingdom's accession to the Common Market and the difficulties of underdeveloped countries arising from declining terms of trade and limited export opportunities for primary products. It must, however, also be viewed as an attempt to stave off the need for agricultural adjustment within the European Community and to provide common price levels for food in the Common Market's competitor countries. There are some weaknesses in the conception of the Plan and its practicability is suspect at several points. The Plan could tend to substitute aid through food supplies for other possibly more useful forms of economic aid to underdeveloped countries. Moreover, it would have far reaching implications for efficiency of resource allocation in that it would introduce a wholly managed system of international trade in foodstuffs. Despite its superficial appeal it is therefore concluded that the Plan does not offer a workable solution to the problems of stagnating world trade in agriculture, aggravated as they will be by the Common Market's commitment to a rigid form and high level of agricultural protection.