HC Deb 08 April 1968 vol 762 cc887-92

The following Question stood upon the Order Paper:

72. Mr. HOOLEY

To ask the President of the Board of Trade, if he will make a statement on the progress of discussions at the United Nations Conference on Trade and Development II.

The President of the Board of Trade (Mr. Anthony Crosland)

With permission, Mr. Speaker, I will now answer Question No. 72.

The Second United Nations Conference on Trade and Development began in New Delhi on 1st February and ended on 29th March. The Conference covered virtually all subjects in the field of trade, aid and development which affect the economic interests of the developing countries. It is too early to make a final judgment on the achievements of the Conference. But I believe that it did produce a number of positive results and in certain sectors laid the foundations for further advance.

First, the Conference unanimously agreed on the early establishment of a system of general preferences on exports of manufactures and semi-manufactures from developing countries. This involves a major change in commercial policies as between developed and developing countries. Although this will require further intensive work, the aim is to settle the details of a mutually acceptable system in the course of 1969.

Secondly, the Conference made significant progress in respect of the aid target. The developed countries accepted a higher target than hitherto, namely, to try to transfer annually to developing countries resources of a minimum net amount of one per cent. of their gross national product at market prices. Previously donors had interpreted the target as 1 per cent. of net national income at factor cost. This new target offers the prospect of a substantial increase in the flow of resources to developing countries in the years to come.

Thirdly, the Conference agreed that work should be put in hand to resolve the problems which still remain in devising a scheme for supplementary finance, and that measures should be worked out and presented to the Trade and Development Board next year.

Fourthly, there was agreement on an international action programme on commodities.

The Conference also adopted resolutions on a wide range of other topics including the terms and conditions of aid, various shipping questions, economic cooperation and regional integration among developing countries, and special measures on behalf of the least developed among the developing countries.

The Conference did not, any more than did its predecessor, produce all the results for which the developing countries hoped. But it did produce certain positive achievements, whose importance in practice will now depend on the follow-up action to be taken. The British delegation played an active and indeed often a leading rôle in the Conference itself. Her Majesty's Government will be equally active in seeking to ensure that the detailed subsequent negotiations make a genuine contribution to the welfare of developing countries.

Mr. Hooley

I am grateful to my right hon. Friend for that very exhaustive and interesting reply. In view of the immense importance of this Conference to the whole of world trade, and especially to under-developed countries, would my right hon. Friend be prepared to publish a general appraisal, including the information he has now given and the significant resolutions of the Conference, so that we can study them more carefully at a later date?

Mr. Crosland

I will certainly consider that suggestion, although, if a document were published, it would have to be a very long one. There were 34 resolutions covering a very large number of subjects, and the House will have access to the normal United Nations documentation which will be available to us.

Mr. Higgins

First, will the President of the Board of Trade confirm that the increase in the financial resources transfer target from I per cent. of national income to 1 per cent. of gross national product is very substantial indeed? How many developed countries are now achieving this? What does it imply for the level of United Kingdom aid? Secondly, as our achieving the target will depend very much on private investment, which the right hon. Gentleman did not mention, what is he now doing to encourage it? Thirdly, has there been any change in the French position on generalised preferences?

Mr. Crosland

The hon. Gentleman is quite right in saying that the newly defined target will mean a very large increase in aid; indeed, there will be a difference of about 25 per cent. between the old target and the new one. I cannot say offhand how many countries are already achieving the higher target, but I would think virtually none is. The United Kingdom is exceeding the present target, but has not achieved the new and higher target. I have said more than once in answering Questions in the House that private investment did not figure in any significant way in the U.N.C.T.A.D. discussions, and there is no change in Her Majesty's Government's policy. The policy of the developed nations as a whole on preferences was laid down in the O.E.C.D. document produced at the end of last year and, although there were certainly modifications on the part of individual countries, that still generally represents, as it were, the negotiating position of the developed countries as a whole.

Sir R. Russell

What effect will this have, broadly speaking, on the Commonwealth preference system as it exists at the moment?

Mr. Crosland

This will prove to be an extremely complex question. The problem will be to dovetail the existing Commonwealth preference system into the new generalised system of preferences. In practice this will be one of the most complex, detailed and difficult parts of the negotiations which will be taking place.

Mr. Philip Noel-Baker

In view of the great importance of the decisions taken at the Conference, and in view of the lack of information facing the Press, the public and hon. Members, may I urge my right hon. Friend to agree to the proposal to publish a White Paper made by my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley)?

Mr. Crosland

I will certainly bear that suggestion in mind.

Mr. Wingfield Digby

Can the President of the Board of Trade give an assurance that no encouragement was given to discrimination in the use of merchant shipping?

Mr. Crosland

There were very long and, again, very difficult negotiations on merchant shipping. I will not go into detail now, unless the hon. Gentleman asks me to, but there was no resolution in favour of flag discrimination, which is what the hon. Gentleman is concerned about; and, had there been one, we would have voted strongly against it.

Mr. Sheldon

As the real hopes for success here very much depend on the improvement of the situation concerning preferences for manufactured and semi-manufactured goods, and as Britain has a very good record in this matter, will my right hon. Friend say what attempts are being made to translate this into positive action when the details are being discussed? It is on these details that success will depend. The general agreement, standing alone, will be of no use. It is the details, which will come next year, which will determine any chances of success.

Mr. Crosland

My hon. Friend is quite right, although I think that we should not underestimate the importance of the agreement in principle which was reached at the U.N.C.T.A.D. Conference. This is something which has not happened before. But my hon. Friend is right in saying that it will be the detailed negotiations that matter, and then I hope that we shall play as constructive a role in them as we can. The Special Committee on Preferences to discuss the details will hold its first meeting in November of this year.

Mr. Maudling

As our balance of payments is much affected by the extent to which aid is tied or untied, to what extent was this discussed or commented on at the Conference?

Mr. Crosland

There was much discussion of the question of untying aid. There is no hope of moving towards more untied aid, in view of the position of the United States Government, who are totally adamant and, therefore, prevent any move towards more general untying. All we were able to do in practice on the question of tying and untying was to discuss the disadvantages which now arise from tied aid, which are quite considerable in practice, and to try to alleviate these.

Mr. Gardner

As to Commonwealth preference, what would be the likely effects on United Kingdom trade if there were these generalised preferences in favour of developing countries?

Mr. Crosland

The object of the exercise is to give an advantage to all developing countries, both Commonwealth and non-Commonwealth countries. To the extent that we give them an advantage, this affects United Kindom trade. This is the whole object of the operation, after all.

Mr. Biggs-Davison

Whether or not there are serious objections to the generalisation of preferences in the Commonwealth, will the President of the Board of Trade state what is the present position of India and Nigeria on this matter?

Mr. Crosland

The hon. Gentleman is quite right in saying that there are different opinions within the Commonwealth on general preferences, as there are on Commonwealth preferences, due to the fact that some countries gain more from the existing Commonwealth preferences than others do. When we come to the detailed discussions in November, we shall, as we did in New Delhi, keep in the closest touch with all Commonwealth countries.

Mr. James Johnson

Is it not a fact that only the French have hit the target of 1 per cent. so far? It is a modest target. When does my right hon. Friend think that we are likely to achieve it, in view of the anxieties in the developing countries, particularly those in Africa?

Mr. Crosland

As my hon. Friend knows, there are special factors which lead to the total French aid being exceptionally large. As for when we shall reach the new target, it would be wrong to give a date, and we did not give a date in New Delhi. We must make sure that our own balance of payments position is brought under control before we can set a definite date to the achievement of the new target.