HC Deb 12 July 1976 vol 915 cc14-5
10. Mr. Blaker

asked the Secretary of State for Trade what amount of the British credit of £950 million for exports to the Soviet Union has been taken up at the latest available date.

Mr. Dell

The total value of contracts placed under the agreement to date is approximately £36 million and further substantial contracts are under discussion between United Kingdom exporters and Russian buyers.

Mr. Blaker

Have the Government considered whether it makes sense for us to compete with other industrialised countries to provide cheap credit to the Soviet Union when we have to pay much higher rates of interest to borrow the money than do other supplying countries? Should we not rely more on the competitive edge given by the depreciation of sterling rather than on subsidised credit?

Mr. Dell

The Government have considered that point and we have come to the conclusion that we nevertheless need to provide this sort of agreement as a framework for trade with the Soviet Union. We now look forward to the Soviet Union placing large orders in this country, in accordance with the assurances given during the recent visits here of both Mr. Gromyko and the Deputy Prime Minister, Mr. Kirillin.

Mr. Kenneth Lewis

Is that not a very poor reply? Will the Minister have a word with his hon. Friends below the Gangway, because whatever influence they have in this country they do not seem to have much influence with their extreme Left-wing friends abroad? This country is doing better trade with capitalist countries than it is doing with Communist countries.

Mr. Dell

There is no point in the type of remark that the hon. Gentleman has just made. Companies in this country are in serious negotiation with the Soviet Union in respect of very large orders, and I anticipate that large orders will be placed within the framework of this agreement.

Mr. Costain

Is the Minister aware that the majority of these orders are for capital goods? Is it not farcical that we should be giving the Soviet Union credit on cheaper terms than our own industries so that they can produce these consumer goods? Is that not absolutely stupid?

Mr. Dell

I must tell the hon. Gentleman, who I know has contacts in industry, that industry does not regard the terms on which we are assisting British industry with the export of capital goods as being excessively competitive. They also want assistance to get orders in the various markets of the world open to them and in the Soviet Union as well.

Mr. Geoffrey Finsberg

Does the Secretary of State not think that there is a danger in supplying this sort of credit and accepting orders for capital and consumer goods, thus allowing the Soviet Union to get on with defence production?

Mr. Dell

The hon. Gentleman knows the controls that exist on the export of defence equipment. We have to decide whether to export civil equipment to the Soviet Union for large orders that we countries, and I find that it is not just the view of the Government but also of British companies negotiating with the Soviet Union for large orders, that we ought to give them this sort of support.