HC Deb 30 November 1949 vol 470 cc1121-2
16. Mr. Skeffington-Lodge

asked the Secretary of State for Foreign Affairs what steps he has taken in the interest of British recovery to divert the German export drive to markets in Eastern Europe; and what measure of success has so far been achieved.

Mr. Mayhew

As one of the Occupying Powers His Majesty's Government is committed, in association with the French and United States Governments, to ensure that German trade conforms with the principles of the European Recovery Programme which is in itself a safeguard for British interests. Within this framework it is the policy of the Occupation Authorities to encourage the development of Western German trade with Eastern Europe which is one of its natural markets. As a consequence trade agreements have been concluded with a number of Eastern European countries envisaging a volume of trade to the value of approximately £70 million in each direction.

Mr. Skeffington-Lodge

Is my hon. Friend satisfied with the progress that has so far been made, and does he realise that unless this progress is extended it is quite likely that the low wage economy in Western Germany will ultimately have a serious effect on our own exports?

Mr. Mayhew

Yes, we appreciate that it is necessary to encourage this trade. The reason that further progress has not been made is certainly not due to any lack of encouragement by the occupying authorities.

Viscount Hinchingbrooke

Will the hon. Gentleman see to it that no British industry is protected in the way suggested in this Question until it is thoroughly efficient?

Mr. Pickthorn

Does the hon. Gentleman's answer mean that in the opinion of His Majesty's Government it is within the ordinary rules of international law and comity that an occupying Power should use its position to direct and control the external trade of the State occupied?

Mr. Mayhew

Clearly we have responsibility here. I would make it clear that we encourage what should be regarded, I think, as a natural development of trade with Germany and we are not protecting our own competitive interests in any way.