HC Deb 14 February 1956 vol 548 cc2146-8
11. Mr. Nabarro

asked the President of the Board of Trade what disequilibrium occurred in Anglo-Canadian overall trade, including invisibles, during 1955; whether he will give figures for such trade; and what steps are being taken to restore balance, overall.

Mr. P. Thorneycroft

I cannot accept the implication that equilibrium in our balance of payments as a whole requires the attainment of the balance individually with Canada or any other country. But what we need to help ease our dollar problem is to win a larger share of Canada's import market. The visible deficit in our trade with Canada in 1955 was about £200 million; imports c.i.f. were £344 million; total exports f.o.b. were £145 million. I regret that the figures of our invisible trade with Canada cannot be separated from those of the dollar area as a whole. The measures which the Government have taken to curb inflation should result in an expansion of our exports to Canada as to other markets.

Mr. Nabarro

Since the deficiency— and there must be a deficiency from the United Kingdom point of view—presumably has to be met by gold payments, what is my right hon. Friend proposing to do about that, in view of the position of the gold and dollar reserve?

Mr. Thorneycroft

It has to be met by gold payments or else by sales to some other market. I do not think it would be practical politics to imagine that we can balance exactly with every country.

Mr. Bottomley

Can the President say what steps are being taken to restore the balance of trade, particularly in view of the latest trade returns, which show a further decline?

Mr. Thorneycroft

To start with, there is the series of measures which the Government have taken to counter inflation. The most important are the increase in the Bank Rate, the reintroduction of hire-purchase restrictions, the call upon the banks to reduce their overdraft facilities and the increases in Purchase Tax in the autumn Budget. All those measures, though no doubt unpopular, are the essential prerequisite of expanding exports to Canadian and other markets.

Mr. Bottomley

Can the President say why trade with Canada is still declining?

Mr. Thorneycroft

I do not accept that it is still declining.

Colonel Crosthwaite-Eyre

May I ask my right hon. Friend, particularly in view of the amount of capital now being spent in Canada by the United States, whether he is taking every step to ensure that British people who wish to invest capital in Canada have that opportunity?

Mr. Thorneycroft

I attach importance to that matter, but the question is primarily one for my right hon. Friend the Chancellor of the Exchequer.