HC Deb 25 March 1958 vol 585 cc206-8
17. Mr. Philips Price

asked the Chancellor of the Exchequer what official approach he has made to the Government of the United States of America with a view to securing its agreement to use the International Monetary Fund to strengthen international exchange reserves by extended credit in the event of a deepening of the American trade recession.

Mr. Amory

The use of the International Monetary Fund is the subject of regular discussion in the Fund's Executive Board, which includes full-time executive directors from this country and from the United States. No new agreement with the United States of America or the Fund is necessary to ensure proper use of the Fund's resources.

Mr. Price

Will the right hon. Gentleman bear in mind that this might be a very important means whereby a depression might be forestalled? In the event of public opinion in the United States being favourable towards it, will he keep his mind open about it and take action wherever possible?

Mr. Amory

I agree with what the hon. Gentleman has said, and I think that the International Monetary Fund and the International Bank have both done extremely useful work during the past ten years. It may well be that there is still more important work for them in the years ahead.

Mr. H. Wilson

Is not the Chancellor aware that, as long ago as last October, when the Government were still complacent about the matter, we pressed this proposal on the Government, and it was turned down flat? Is he aware that it is not a matter of agreement as to the use of existing reserves but that the reserves of the International Monetary Fund need to be very greatly strengthened and enlarged in order to meet the shortage of liquidity in international trade?

Mr. Amory

I think that there are no signs, so far, that the resources of the Fund are insufficient; but I quite agree that a position may arise when the activities of both these organisations ought steadily to expand, and I hope that that will, in fact, be the course that we shall see followed in the years ahead.

Mr. Wilson

But will the right hon. Gentleman say whether, during the recent mission to Washington of high officials of his Department, this question was discussed with the American Government?

Mr. Amory

The right hon. Gentleman knows that we take every possible opportunity of keeping in personal touch with the Administration in the United States on all current problems.

Mr. Biggs-Davison

Would not part, at least, of the desired result be achieved by raising the price of gold?

Mr. Amory

I am afraid that I am not in a position to take unilateral action on that.