Journal of European Integration History – Revue d'histoire de l'

Challenge to the Community 19period. 52 At least as long as EFTA's aims – in contrast to the EEC – remainedessentially limited to trade liberalisation and bridge-building, its weak intergovernmentalinstitutional structure did not reduce its effectiveness in challenging theEEC over the trade conflict in Western Europe after de Gaulle's veto against anOEEC-wide FTA. Instead, EFTA's four main weaknesses – as the internal debatesover tariff acceleration and possible EEC membership or association showed in1960-1 – were its low degree of economic cohesion, its lack of political consensuson the best approach to the EEC, Britain's weak economic and political leadership,and the opposition of the United States to a trade settlement between the two blocs.In addition to its overall lack of geographical coherence, two factors chieflyaccounted for EFTA's low degree of economic cohesion. The first was the inclusionof two peripheral states with a very weak industrial base, Portugal and Finland.Unlike in the comparable case of Greece and the EEC, Portugal became a memberof EFTA straight away and thus participated fully in the decision-making process.Finland became an associate member only, to avoid antagonizing the Soviet Union,but de facto participated fully in EFTA deliberations. 53 Both states required substantialderogations and transitional periods and thus complicated EFTA business,especially over the thorny issue of tariff acceleration. Scandinavian pressure largelyaccounted for the favourable association conditions of Finland, which was heavilydependent on its timber exports to the EFTA states, especially to Britain. 54 Finnishagreement to grant imports from the Soviet Union EFTA treatment on a mostfavoured-nationbasis had temporarily called into question whether the British, whostrongly believed that under GATT rules the EFTA obligations would supersedeany bilateral Finnish obligations vis-à-vis the Soviets, would sign the associationtreaty. However, the Swedish Trade Minister, Gunnar Lange, insisted in a meetingwith Edward Heath, the Lord Privy Seal with responsibility for European Affairs,in Stockholm in December 1960 that while “the Finns had been ill-advised in theirtactics with the Russians and (...) had misled all their friends in EFTA”, it wasnonetheless crucial to allow them “to retain one foot in the Western camp”. 55The second factor in EFTA's low degree of economic cohesion was that theEFTA Treaty was widely regarded as an uneven agreement that gave greater advantagesto the industrial export nations and did not provide for sufficient compensationsin agriculture and fish. Norway and Denmark had been content in 1959 withBritain's concessions. On this basis, they had agreed on the initial timetable for the52. A. IVEROTH, “Die kommerzielle Bedeutung der EFTA”, in: EFTA Bulletin 11/4 (1970), pp.12-19(18).53. On Finnish neutrality and European policy see T. MUOSER, Finnlands Neutralität und die europäischeWirtschaftsintegration, Baden-Baden 1986.54. Of Finland's exports in 1958-9, 30.3 per cent went to EFTA states, 26.8 per cent to the EEC and 24.9per cent to Eastern Europe, mainly to the Soviet Union. Cf. Overbeck (Helsinki) to AuswärtigesAmt: PA AA 354/Ref. 200-I A2 (3 November 1959).55. Talks Heath-Lange: PRO PREM 11/4535 (1 December 1960). For British policy on Finland's EFTAassociation see also Bishop to Macmillan: PRO PREM 11/4535 (22 March 1961) and W. KAISER,“Neutral, nicht neutral, auch egal: Großbritannien, die Neutralen und die europäische Integration1945-72”, in: GEHLER and STEININGER, Die Neutralen (forthcoming).