HC Deb 27 October 1953 vol 518 cc2618-22
The President of the Board of Trade (Mr. Peter Thorneycroft)

With your permission, Mr. Speaker, and with that of the House, I should like to make a statement about the recent session of the General Agreement on Tariffs and Trade.

At this session, four matters of special interest to the United Kingdom were discussed, and I shall deal with them in turn. The Japanese request for provisional association was eventually abandoned in favour of a resolution under which those countries who wish to do so can assume individually the obligations of the General Agreement towards Japan. The United Kingdom and a number of other countries abstained from voting on this resolution and will not undertake to assume the obligations of the General Agreement towards Japan under the resolution. I explained the reasons for our policy in my speech to the Contracting Parties on 23rd September. As I then said, we consider that any step towards admitting Japan to the General Agreement would be premature and might well lead to a general raising of trade barriers.

On the no-new-preference rule, I am happy to be able to inform the House that the Contracting Parties have agreed to a waiver which will give the United Kingdom, subject to certain conditions, general dispensation from any obligation to impose duties on Commonwealth goods in cases where we are free to impose or raise tariffs on foreign goods, and where we need to do so in order to protect United Kingdom industry. I have placed in the Vote Office copies of the resolution and procedures which were adopted, so that hon. Members may see the precise terms of the waiver. The procedures agreed upon in Geneva fall somewhat short of what we would have liked to obtain to meet our difficulties in full, but Her Majesty's Government are confident that, with the goodwill on which we can rely, the procedures will work satisfactorily. Her Majesty's Government will, of course, keep a close watch on developments, and, if unexpected difficulties arise, will naturally have to review the position.

The House will also wish to know that the United Kingdom agreed with the other Contracting Parties to extend for a further period of 18 months the bar against re-negotiating duties which are bound by the General Agreement. This will provide for a desirable degree of stability in tariffs for the period in question.

Finally, the Contracting Parties have provisionally agreed that there should be a comprehensive review of the General Agreement in the late autumn of 1954.

Mr. H. Wilson

While complimenting the right hon. Gentleman on the policy he has followed in relation to Japan, which we on this side of the House, wish to endorse, may I ask him two questions on the other point? In the first place, will he make it clear to the House that this obligation to the contracting parties is not in any sense designed to increase the flow of Commonwealth trade to this country, but only a device to enable him to consider applications for increased horticultural and other tariffs? Secondly, will he tell the House whether during his negotiations in Geneva he re-affirmed the statement made by this party when we were the Government of the country that if the General Agreement is to become a per- manent instead of an interim instrument, we shall require to see the no-new-preference ban removed?

Mr. Thorneycroft

On the first point, the waiver with which I have been concerned here is to deal with the special difficulty in which this country finds itself, under Which, unlike any other country, we were effectively prevented from moving on our unbound tariff list. It was that difficulty and not a general extension of preferential margins with which we were concerned.

With regard to future agreements or discussions which may take place about the reform of the General Agreement, I think that detailed discussion of that can wait until we are a little nearer to the time. We have already made perfectly plain our particular views about the no-new-preference rule, which were, indeed, embodied in the communiqué issued after the last Commonwealth Conference.

Mr. Beresford Craddock

May I assure my right hon. Friend—[HON. MEMBERS: "No."] I am making a preface to my question—that he has the full support of a very large number of hon. Members on this side of the House in the attitude he has taken up towards the application of Japan for membership? It seems——

Mr. Speaker

Order. Prefaces should be short.

Mr. Craddock

Does the new position with regard to Japan alter their export programme of textiles to, say, British East Africa? That is my first question.

The second question is, am I right in assuming that under the procedure, if my right hon. Friend wishes to increase the preference of a product, he has to give notice to those concerned and that they have 30 days in which they can refuse or accept his proposal after which it then goes to arbitration? If that long procedure is correct, can anything be done to hasten it?

My third question—this is a very important question for the future of British trade—is with regard to the question of a review taking place. Would my right hon. Friend consider setting up a committee in this country to consider the future trade policy of this country on the lines of the commission which President Eisenhower has set up with regard to the future policy of the United States?

Mr. Thorneycroft

With regard to the first question, the position concerning Japan remains as it is today, namely, that we have not assumed the obligations of the General Agreement towards her. With regard to the second question, the procedures are set out in detail in the papers now in the Vote Office, but it is correct to say that there is a 30-day period during which countries are entitled to raise the point. With regard to the commercial policy of this Government, while I admire much that goes on in the United States, I do not think that we need necessarily follow slavishly the examples set in other countries when framing our own policy.

Mr. S. Silverman

Has the right hon. Gentleman formed any estimate of what is likely to be the effect of the admission of Japan on Lancashire's textile trade, and can he say whether he has in mind any protective device of any kind to save the Lancashire trade from too great an impact from the new situation?

Mr. Thorneycroft

I do not think it is really possible to make any detailed assessments as to what will be the effect upon Lancashire trade upon the accession of certain countries that might seek a protocol. So far as this country and the southern Dominions are concerned, they have stood out and are not under an obligation to extend those particular arrangements towards Japan.

Captain Duncan

May I congratulate my right hon. Friend, as far as the horticultural industry is concerned, in allowing us to give such protection to it as to make it continually prosperous, and may I ask him what steps the horticultural industry should now take relating to the level of tariffs which they require?

Mr. Thorneycroft

I have been considering an application from the National Farmers' Union for higher duties on horticultural products. A large part of its application deals with fresh and preserved fruit and vegetables on the unbound tariffs. This waiver should enable us, in this and any other cases where we decide that the duties should be increased, to move on those items, and we are now putting them through the procedures agreed for the purpose of so doing.

Several Hon. Members rose——

Mr. Speaker

Order. There is no Question before the House.