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Choosing the Periphery 89
modernisation plan was to subject sheltered industry to foreign competition and
turn it into an export industry. However, the contract with the trade union movement
and industrial organisations suggested the need for modernisation before exposing
the sheltered industry to competition. As developing the export sector consumed
the majority of the investment resources available, modernisation lagged
behind. Hence, it was protected throughout the 1950s. Norway was trailing in its
liberalisation of import quotas and in the textile industry the government raised tariff
rates when it was forced to liberalise import quotas. For many of the commodities
produced by the domestic industry, the tariff rate was between twenty and thirty
percent ad valorem. Prior to the GATT bargaining rounds, negotiators were
always instructed that export interests were to be balanced against the domestic industry's
need for protection. During the Torquay round, in 1951, Norwegian negotiators
would not push the high-tariff countries too hard because “one would risk decisions
which threatened the domestic market industry”. 35 A defensive bargaining
policy for the 1956 Geneva round was developed because quota liberalisation had
become effective. 36 While Norway was listed as a member of the Low Tariff Club
in the OEEC, it was well aware that the tariff rates for domestic industry in a
number of cases made such membership fairly undeserved. Fears of the strong
Swedish industry also encouraged the Norwegian government to reject a Nordic
preference area in the 1950s. As the next section will show, a change in attitudes
concerning domestic industry developed in 1957-58 and was confirmed by the
EFTA experience. This led, consequently, to regard the Community in the 1960s as
a lesser threat to the Norwegian sheltered industry than heretofore.
The long-term plan developed in the 1940s also included the primary sector.
Both agriculture and fisheries had low productivity and the goal was to liberate labour
from the primary sector through modernisation for the expanding industrial
sector. According to official statistics, the outcome of this policy was a decline in
the number of operator-owned farms from 195,000 in 1949 to 141,000 in 1969.
During the same period of time the number of fishermen declined from 98,000 to
45,000. At first glance these were dramatic changes. However, the farm units that
disappeared were so small that under no circumstances would they have provided a
basis for subsistence. The same trend applied to the fishing fleet. The desire for a
careful modernisation in the primary sector allowed both agriculture and fisheries
to retain a structure and an income level that made them utterly dependent on protectionism,
market regulations and State subsidies. Thus, the prospect of Norway's
Community membership was perceived from the primary sector as a real threat.
Due to the operating structure of the sector, the drop in employment was not translated
into a proportionate drop in electoral strength. In 1949 full-time farmers operated
only about forty per cent of the farms. In 1969 the proportion dropped to thirty-three
35. RA, Privatarkiv Norges Industriforbund [Private archive of the Norwegian Industrial Association]
(henceforth, PNI), box 1746, Report from the Norwegian delegation at the international tariff negotiations
in Torquay, undated.
36. UD 44.2/13, Report from the committee set up to prepare Norwegian policy at the tariff negotiations
in Geneva, undated.