§ 4. Major-General Sirf ALFRED KNOXasked the President of the Board of Trade the total value of the imports from Soviet Russia to Great Britain and of the exports from Great Britain to Soviet Russia, distinguishing between exports of goods produced in Great Britain and reexported for each of the years 1934 and 1935; and what was in each case the trade balance favourable to Soviet Russia?
§ The PRESIDENT of the BOARD of TRADE (Mr. Runciman)As the answer involves a table of figures, I will, with
§ The following table shows the total declared value of merchandise imported into and exported fro ii the United Kingdom in the trade with the Soviet Union during each of the years 1934 and 1935, together with the excess of imports over exports.
| Exports from the United Kingdom consigned to the Soviet Union. | |||||||
| Year. | Imports into the United Kingdom consigned from the Soviet Union. | Produce and manufactures of the United Kingdom. | Imported merchandise. | Total exports. | Excess of imports over exports. | ||
| £'000. | £'000. | £'000. | £'000. | £'000. | |||
| 1934 | … | … | 17,327 | 3,641 | 3,905 | 7,546 | 9,781 |
| 1935 | … | … | 21,736 | 3,505 | 6,206 | 9,711 | 12,025 |
§ Notes.—(1) The balance of payments between the United Kingdom and the Union of Soviet Socialist Republics as ascertained in accordance with the Anglo-Russian Trade Agreement of 1934, was as follows:
| 1934. | 1935. | |
| £ | £ | |
| Proceeds of the Union of Soviet Socialist Republics | 16,020,000 | 21,006,000 |
| Payments of the Union of Soviet Socialist Republics | 15,318,000 | 15,917,000 |
§ (2) The figures for 1935 are provisional.
662§ my hon. and gallant Friend's permission, circulate it in the OFFICIAL REPORT.
§ Sir A. KNOXCan the right hon. Gentleman say what was the trade balance in those two years?
§ Mr. RUNCIMANIf my hon. and gallant Friend will await the figures, which are in tabular form, he will see the position clearly set out.
§ Mr. KIRKWOODIs it not the case that the trade balance is more in our favour now than it has been in any previous year?
§ Sir JOSEPH NALLIs it not a fact that there is a very large adverse balance; and in view of the fact that the Soviet does not pay for a great part of its purchases here but is allowed a credit, can the right hon. Gentleman say what is happening to the proceeds of Russian trade?
§ Mr. RUNCIMANNo, Sir. Compared with the proceeds, the payments certainly do not show so great an adverse balance.
§ Mr. MACQUISTENWill not the Russians require all the money they are getting to supply armaments to Sanin?
§ Following is the answer:
663§ 7. Sir WILLIAM DAVISONasked the President of the Board of Trade what was the total amount of exports of. United Kingdom produce and manufacture to the Union of Soviet Socialist Republics apart from re-exports and the total imports from the Union of Soviet Socialist Republics into Great Britain from the date of the temporary commercial agreement of 16th February, 1934, to the latest available date in the current year; and what is the proportion of re-exports to exports of United Kingdom produce and manufactured goods?
§ Mr. RUNCIMANThe commercial agreement between the United Kingdom and the Soviet Union came into force on 21st March, 1934, but the balance of payments between the two countries was regulated as from 1st January, 1934. During the period January, 1934, to September, 1936, the total declared value of merchandise imported into the United Kingdom and consigned from the Soviet Union was £51,880,000 and of exports of United Kingdom produce and manufactures to the Soviet Union £9,857,000. The value of re-exports during the same period was £17,962,000 and was thus 82 per cent. greater than that of United Kingdom goods exported.
§ Sir W. DAVISONDoes the right hon. Gentleman not think it desirable that notice should be given to terminate that temporary or interim agreement, with a view to having a permanent treaty negotiated on terms more favourable to this country?
§ Mr. RUNCIMANI should be prepared to look into that point, but I do not think it arises. We are working now on this agreement and it is not working unsatisfactorily.
§ Sir W. DAVISONWas not a pledge given to a number of people that this should only be an interim agreement pending the completion of a formal treaty of trade and navigation; and as this matter has now been on for nearly three years, is it not time that a formal treaty was under negotiation?
§ Mr. RUNCIMANI cannot undertake to negotiate a formal treaty at the present moment.
§ 8. Sir W. DAVISONasked the President of the Board of Trade for what 664 reasons the British Government guaranteed payments by the Russian Soviet Government to the amount of £10,000,000 in respect of goods purchased in this country, having regard to the fact that the Russian Government have a favourable trade balance in Great Britain estimated at approximately £15,000,000; and what steps will be taken to see that this guarantee is not made use of so that munitions of war may be purchased contrary to the provisions of the agreement out of the free credit balance already at the disposal of the Soviet Government in this country?
§ Mr. RUNCIMANThe purpose of the agreement between the Export Credits Guarantee Department and the Soviet Trade Representative is to encourage the export of goods wholly or partly manufactured in the United Kingdom. It specifically excludes munitions of war, the export of which to Soviet Russia, as to all countries, is subject to the provisions of the Arms Export Prohibition Order, 1931. As regards the balance of trade with Russia, I would invite the attention of my hon. Friend to the Schedule to the Temporary Commercial Agreement of February, 1934, which prescribes the increasing proportion which the disbursements of the Soviet Government. on goods purchased in this country and British shipping services are to bear to their proceeds from imports into this market. The proportion for the current year is 1 to 1.4 while for 1937 it will be 1 to 1.2.
§ Sir W. DAVISONBut that proportion is only obtained, is it not, by taking in re-exports, ninny of which do not even come to this country at all or, at any rate, only pass through our ports; are not those figures therefore fallacious; is it not a fact that the figures quoted in the question are accurate and that there is a trade balance of something approaching £15,000,000; and why should not that be used to make purchases in this country?
§ Mr. RUNCIMANIt has often been explained in this House that re-exports are a distinct advantage to us.