HC Deb 03 February 1949 vol 460 cc1809-11
6. Mr. Janner

asked the President of the Board of Trade if he can yet make a statement on the recent tobacco talks.

8. Mr. Harrison

asked the President of the Board of Trade if he will make a statement on the recent Anglo-U.S. negotiations on Virginian tobacco supplies.

Mr. H. Wilson

Yes, Sir. At the request of the United States Government, officials of my Department together with officials of the Treasury last week met officials of the United States State Department, Department of Agriculture and Treasury and of the Economic Cooperation Administration to discuss the future outlook for United Kingdom purchases of United States tobacco. The United States representatives explained the importance of their knowing the probable requirements of the United Kingdom during 1949 in order to ensure so far as possible that an adequate crop was planted this Spring. The United Kingdom representatives said that the imperative need to balance the United Kingdom's dollar payments as soon as possible would continue to impose a strict limit on the sums which could be spared for the purchase of American tobacco. For this reason United Kingdom purchases from the 1947 and 1948 crops had been restricted below the minimum necessary for the present level of consumption which had been maintained only by drawing on stocks; but in order to maintain the present rate of consumption the United Kingdom expected (provided that there was no substantial adverse change in the dollar position) to buy in 1949 more U.S. tobacco than in 1948.

The probable position in later years was touched on but not discussed in detail. It was made clear in the discussions that full allowance was being made for all supplies which could be obtained from other sources. I should emphasise that nothing that took place during these talks affects the need for the United Kingdom to obtain from non-dollar sources as much tobacco of suitable quality and price as possible.

Mr. Janner

Can my right hon. Friend say whether there is a prospect in consequence of these talks of a reduction in the price of tobacco and cigarettes in the near future?

Mr. Wilson

My hon. Friend had better put a Question down.

Mr. Harrison

In connection with these negotiations, has my right hon. Friend given full consideration to the possibility of expanding our re-exports of manufactured tobacco, thereby keeping both the local and the national tobacco trade fully employed and encouraging the maintenance of areas in the tobacco belt for the purpose of producing the Virginian tobacco which we like so much?

Mr. Wilson

Yes, Sir. Those considerations are very much in mind, but I would remind my hon. Friend that it would be uneconomical to increase to any substantial extent our re-exports to soft currency areas of tobacco which had been paid for in dollars.

Squadron-Leader Fleming

Will the right hon. Gentleman keep in mind during any further talks on the matter that British Empire tobacco growing interests must not be impeded by any future negotiations with the United States?

Mr. Wilson

That has been very fully kept in mind throughout the discussions. The record of the Government and the tobacco manufacturers of this country in placing contracts for Commonwealth-produced tobacco is an extremely fine one.