HC Deb 28 January 1974 vol 868 cc9-12
6. Mr. Moate

asked the Secretary of State for Trade and Industry what is the latest available figure for the United Kingdom balance of trade deficit with the rest of the EEC in 1973.

21. Mrs. Doris Fisher

asked the Secretary of State for Trade and Industry what was the percentage increase for British exports to the EEC for 1973; and what was the comparable percentage increase for EEC imports into Great Britain.

The Secretary of State for Trade and Industry and President of the Board of Trade (Mr. Peter Walker)

The deficit for 1973 was £1,120 million, and the percentage increases for exports and imports were 37 per cent. and 48 per cent. respectively.

Mr. Moate

Does my right hon. Friend recall that it was for the privilege of securing this enormous trade deficit of £1,120 million that the Government were prepared to accept the obligations of Community membership and the burden of the common agricultural policy? As a bargain, it can hardly be described as a good one. Does not my right hon. Friend consider that the time has come for a substantial renegotiation of the terms of entry?

Mr. Walker

Compared with the rest of our exports which went up 26 per cent. last year, our exports to the Community went up 37 per cent. There are also very substantial invisible earnings from which we have benefited as a result of our entry into Europe.

Mrs. Fisher

Is the right hon. Gentleman really satisfied with these figures? Do they not prove that we are losing the battle of exports across the Channel? Will he now produce for the benefit of the House a White Paper showing the trading figures for and against our first year's membership of the EEC?

Mr. Walker

The hon. Lady, coming from Birmingham, should appreciate that virtually the whole of the deficit is accountable by the increase in our imports of fuel, machinery and industrial materials, which have been of benefit to industrial areas like hers which have also benefited from the 37 per cent. increase in our exports.

Mr. Fell

Can my right hon. Friend recall the figures for our trade with EFTA in the last year?

Mr. Walker

Not without notice.

Mr. Dell

Do the Government attribute this deficit and the enormous deficit with the countries with which we were formerly members of the European Free Trade Area to a basic uncompetitiveness of the British economy as compared with Europe, or to the Government's economic policies?

Mr. Walker

The fact that we have increased our exports to such a degree and the fact that during a period when there was a substantial growth in manufacturing industry in this country we have imported more machinery, fuel and industrial materials than before have been the reason for this size of deficit in the last year.

Mr. Grylls

Although this supplementary question is not directly connected with the EEC, will my right hon. Friend take note of the fact that we all congratulate him on his deal with Iran and say whether he thinks that there is a great future for our exports to the Middle East?

Mr. Walker

In recent months the proportion of our exports to the Common Market has been increasing. I still believe that there is a substantial potentiality for growth in this export market.

Mr. Greville Janner

When did the Government first recognise that our trade deficit, of which the EEC portion forms only part, was getting serious?

Mr. Walker

At the beginning of the year we predicted that even on the then knowledge of commodity prices there would be a deficit if we were going to get a period of growth. Alas, the price of world commodities substantially increased that deficit.

Mr. Rost

Has my right hon. Friend calculated to what extent our trade deficit with Europe is attributable to Communist subversion which is affecting British industry, slowing down exports and sucking in more imports?

Mr. Walker

No, Sir.

Mr. Carter

In view of the devastating effects of the three-day working week and of the Government's economic policies on the output of British industry, will the right hon. Gentleman give serious consderation to the restriction of imports of foreign motor cars into this country?

Mr. Walker

I can imagine nothing which would do more harm to British Leyland than the creation of conditions world-wide whereby countries imposed restrictions on the import of cars. As the hon. Gentleman will know, the British motor industry has a very substantial interest in exporting cars throughout the world.

Mr. Wilkinson

Will my right hon. Friend take every step to encourage European investment in the regions of this country, which would make a very substantial net improvement to our balance of payments position?

Mr. Walker

Yes, Sir. Already a number of my right hon. and hon. Friends in the Department of Trade and Industry have held conferences with business men and Governments on the Continent for this purpose.

Mr. Benn

In this connection, will the right hon. Gentleman convey to Sir Christopher Soames—whose salary, as a civil servant, we pay and who represents nobody—the great resentment created in this country by his political statements about the trading policy of this Government or of any British Government, particularly in view of the very great damage to our interests which has taken place in trading in the first year of our membership?

Mr. Walker

No, Sir.