§ 30. Mr. HAMMERSLEYasked the Secretary of State for the Colonies if he can now make a statement on the policy of His Majesty's Government for dealing with excessive importation from Japan into the Colonial Empire?
§ The SECRETARY of STATE for the COLONIES (Sir Philip Cunliffe-Lister)I understand that my right hon. Friend the President of the Board of Trade is to make a statement in reply to a subsequent question.
§ 43. Captain DOWERasked the President of the Board of Trade if he is now in a position to make a statement as to the result of his further conversation with 716 the Japanese Ambassador with regard to trade negotiations between this country and Japan?
§ 44. Mr. REMERasked the President of the Board of Trade if he has any statement to make as to his conversations with the Japanese Ambassador on Thursday?
§ 46. Mr. CHORLTONasked the President of the Board of Trade whether he can now make any statement on the conversations between His Majesty's Government and the Japanese Government relating to the cotton and rayon industries?
§ The PRESIDENT of the BOARD of TRADE (Mr. Runciman)The House will remember that when I last made a statement on this subject on 15th March I informed them that, on the failure of the representatives of the textile industries of Japan and of this country to come to an agreement, the whole position was under review between the two Governments. When I saw the Japanese Ambassador on 16th March, I handed him a memorandum inquiring whether, in the circumstances, the Japanese Government had any proposals to put forward for dealing with the problem. On 31st March I received a reply in which the Japanese Government expressed their willingness to consider any further proposals which His Majesty's Government in the United Kingdom might make, but made no proposals of their own.
The Government have considered the whole problem again very carefully in the light of this reply. It is already a year since His Majesty's Government drew the attention of the Japanese Government to the serious position arising from Japanese competition. It is, of course, of the utmost importance that every effort should be made to deal with a problem of this magnitude in the most appropriate way. Unfortunately there appeared to be nothing in the Japanese Government's note of 31st March to suggest that an early agreement on this subject was to be expected. Although, therefore, the Government still hold the view that the problem which faces us is one which can only be settled satisfactorily by co-operation in some form between Japan and ourselves, His Majesty's Government cannot allow a situation to develop in which negotiations are protracted indefinitely without any immediate prospect of success 717 and during this time the Japanese—quite naturally from their point of view—are continuously expanding their exports in our markets to the detriment of Lancashire, while our hands are tied. Accordingly His Majesty's Government have come to the conclusion that they would not be justified any longer in postponing, in the hope of agreement, such action as is open to them with a view to safeguarding the trade of this country. I therefore informed the Japanese Ambassador on Thursday last that in the circumstances His Majesty's Government were obliged to resume their liberty to take such action as they deemed necessary to safeguard our commercial interests. I assured him—and I am confident the House will join me in this—that such steps as it was proposed to take would be taken in no unfriendly spirit.
As regards the Anglo-Japanese Treaty, I am satisfied that His Majesty's Government can, without denouncing it, take proper and sufficient measures to protect the commercial interests of this country, and in these circumstances I see no reason to terminate a Treaty which has regulated the commercial relations between the two countries for over 20 years. As far as the United Kingdom market is concerned, the Government do not feel they can any longer continue to suspend the review of the silk duties by the Import Duties Advisory Committee and my right hon. Friend the Chancellor of the Exchequer has asked the Committee to complete its report on these duties as quickly as possible.
In the case of Colonial markets, my right hon. Friend the Secretary of State for the Colonies has been in consultation with Colonial Governors. The Governments of the Colonies and Protectorates for which such action would be appropriate will be asked to introduce import quotas which, except in the case of West Africa, would apply to all foreign imports of cotton and rayon goods. With a view to reinstating this country in the position in those markets which she held before the present abnormal period, it is intended that the basis for apportioning these quotas as between foreign countries shall be as far as possible the average of their imports in the years 1927–1931. It is further proposed that the necessary legislation in the Colonial territories should be enacted with the least possible delay, and that it should be so framed 718 that the actual quota regulation will be reckoned as commencing retrospectively from to-day, 7th May, so that no attempt at forestalling will be allowed to frustrate the policy and intentions of the measures under contemplation. In the most important of the West African Colonies, as the House is aware, there are treaty obligations which preclude differentiation in favour of our own goods. It was for this reason that on 16th May of last year notice was given to release the West African Colonies from their obligations under the Anglo-Japanese Treaty, and action there will be limited to Japanese goods.
I have not attempted to deal in this statement with the position of any goods except cotton and rayon textiles. The Government are aware that Japanese competition is not limited to these goods, and they are considering in the case of each of the other industries involved what tariff action in Colonial markets is called for. As regards the home market, I have no reason to suppose that the matter cannot be dealt with by means of the ordinary procedure of the Import Duties Act. While His Majesty's Government cannot any longer refrain from taking steps to safeguard our trade interests, we shall, of course, be ready at any time to give the most careful consideration to any proposals which the Japanese Government may desire to put forward towards the solution by mutual agreement of this difficult problem. A solution of this kind ought to be possible where the Governments of the two countries are, as I am sure they are, anxious to agree.
§ Mr. HAMMERSLEYWhile thanking my right hon. Friend for the comprehensive nature of the reply, might I inquire whether steps are to be taken to consult the Dominions with a view to their taking co-operative action?
§ Mr. RUNCIMANThat is a question purely for the Dominions themselves, and I am afraid that I cannot intervene in that matter.
§ Captain DOWERWhile thanking my right hon. Friend for his reply, which will be most warmly welcomed in Lancashire, may I have his assurance that he will watch the dumping into the Colonies of Japanese goods other than textiles?
§ Mr. CHORLTONMay I ask my right hon. Friend if, in the action which he 719 proposes to take, he can tell us anything about the most-favoured-nation clause and its denunciation, because that will provide him with a far greater weapon than those which he proposes this afternoon?
§ Mr. RUNCIMANNo, Sir. I am afraid that I cannot agree with my hon. Friend in that conclusion.
§ Mr. AMERYMight I ask if there is any reason why the Dominions should not be consulted with a view to their co-operating with us in this matter?
§ Mr. RUNCIMANThe Dominions have been kept fully informed of what we have done, but the initiative must, of course, come from them.
§ Major PROCTERMay I ask whether, in fixing the quota, the right hon. Gentleman will also fix the price of the quota cloth from Japan going into the Colonies?
§ Mr. HALESMay I ask the right hon. Gentleman whether he has thought of consulting with other nations outside the Empire, as the Japanese competition is affecting every nation of the world and is undoubtedly the greatest menace since we have had a civilisation?