Far East (Hansard, 30 March 1995)

§ 7. Mr. Key
To ask the Chancellor of the Exchequer what representations he has received from Ministers and business men in the far east regarding the prospects for Britain's future economic success. [15281]

§ Mr. Kenneth Clarke
I regularly meet Ministers, officials and business men from the far east. Britain's good economic prospects always feature strongly in my discussions with them.

§ Mr. Key
In little more than a decade, China will be the world's biggest economy. Is not the dramatic rise in Britain's exports to China in the past couple of years proof of the effectiveness, efficiency and competitiveness of our economy in the world?

§ Mr. Clarke
I agree with my hon. Friend. I am extremely glad to say that exports to China rose by 70 per cent. in the last year for which we have full figures alone. China is now one of the most dynamic economies in the world. It is a sign of how much Britain has changed over the past 16 years that British business and industry is now competitive and so effective in taking part in the affairs of that part of the world which has the most dynamic economies.

§ Mr. Stevenson
Is the Chancellor aware of the flood of investment from this country to the far east? For example, Royal Doulton in my constituency has just announced its intention to build a factory and create 600 jobs in Indonesia. Is he concerned about this so-called out-sourcing? How is it in Britain's interests? Is it not just another example of the export of jobs?

§ Mr. Clarke
The abolition of exchange controls and the opening up of investment from this country overseas and into this country by overseas investors is one of the most dramatic and beneficial changes that the British economy experienced in the 1980s. The hon. Gentleman epitomises just how old-fashioned the Labour party is in its approach to these matters. This country benefits from investment by Japanese, Korean, American and European companies. It also benefits from the flowing back into this country of what is earned from investment by British companies overseas. Indeed, we have now restored the old level of investment that Britain used to have before its past portfolio went during the wars, and the flows into this country are extremely valuable—as valuable as visible trade to the well-being of this country.

§ Mr. Marlow
As an avid reader, has my right hon. and learned Friend read the very interesting article in today's edition of the Daily Mail by Mrs. Fukuda, vice-chairman 1173 of a major Japanese investment bank, Nikko Europe, in which she says that she suspects that Japanese investors would be happier if Britain stayed outside the single European currency? Is that a fit subject for discussion with his hon. Friends and, if so, is his door open?

§ Mr. Clarke
I am sure that there is a range of opinion on these matters in Japan as there is in this country. I would be happier if the Japanese lady would wait until the single currency has been designed—[Interruption.]—until we have seen whether Britain is likely to join it and when we have an altogether better basis on which to make a decision on that event if and when it ever occurs. At the moment, I think that Japanese opinions are mixed. Certainly, our involvements with Europe and in south-east Asia are both essential to the continued success of this country in the world economy.

§ Mr. Corbyn
In his discussions with business men in the far east, does the Chancellor of the Exchequer ever raise the subject of the use of prison labour and child labour and of human rights abuses in the economic zones of China that he is so quick to praise? Will he link Britain's trade relations with China with the urgent need for a review and improvement of that country's abominable human rights record in those areas?

§ Mr. Clarke
I have never been to the People's Republic of China, so I have never had an opportunity to raise the matters to which the hon. Gentleman refers. Every hon. Member is of course against slave labour, child labour, prison labour for export and the other things that the hon. Gentleman described. Our trade with China is extremely beneficial to this country—straightforward trade and investment, which is of great benefit to the people of this country. We look forward to China becoming a successful, free-market economy and a more liberal and democratic society, which increased prosperity there will tend to produce. Britain should be a close trading and investing partner with that country.