HC Deb 15 March 1976 vol 907 cc927-9
14. Mr. Marten

asked the Secretary of State for Trade if he will make a statement about trade with Commonwealth countries.

Mr. Shore

British exports to Commonwealth countries increased in value last year by 20 per cent. over 1974, while imports remained stable. My Department and our posts abroad are alert for opportunities to maintain this expansion.

Mr. Marten

As the Common Market share of our export market is declining whereas the Commonwealth share is not declining, and as, in 1975, we had a balance of trade deficit of £2,386 million with the Common Market, compared with £35 million with the Commonwealth, should not we do everything we can to stimulate trade with the wider market of the Commonwealth and certainly keep out of the currency snake pit?

Mr. Shore

I am anxious to expand trade in all possible ways with our Commonwealth partners. There are difficulties, as the hon. Gentleman is fully aware, because the arrangements with the EEC reduce the opportunities for trade, particularly in food, with Commonwealth countries. That is a feature of the common agricultural policy. Some possibilities for trade exist as a result of the Lomé Convention. The Commonwealth countries concerned are within the EEC ambit and they can trade freely with this country and with others.

As for the Asian Commonwealth countries, we are doing our best through the generalised system of preferences arrangements, and I recently signed an economic co-operation agreement with the Indians, who are the largest of our Asian Commonwealth partners. The other advanced Commonwealth countries are members of the OECD and therefore cannot come easily within special arrangements for trade.

Mr. Raphael Tuck

Will my right hon. Friend come off his ministerial pedestal and, as a private citizen, tell us whether the gloomy figures just given by the hon. Member for Banbury (Mr. Marten) belie completely the great hopes that were expressed three and a half years ago when we joined the Common Market?

Mr. Shore

My hon. Friend knows that I have no difficulty whatever in reconciling my private voice and my ministerial voice on these questions. Those who foolishly thought that at any rate short-term and large benefits would accrue in trade between Britain and the EEC as a result of our membership have been shown to be lamentably wrong.

Mr. Burden

The right hon. Gentleman says that last year there was an increase in value in exports to Commonwealth countries. Will he relate that to volume, and compare it with the previous year?

Mr. Shore

I have not with me the volume figures for the Commonwealth. I should think that the volume figure of our trade increase was probably almost nil, but there must have been a corresponding fall in Commonwealth import volumes.

Mr. Gwilym Roberts

Does my right hon. Friend accept that the increase in exports to the Commonwealth and other areas is a matter not of price alone but of service, quality, delivery dates, and so on? Therefore, does he agree that the recent floating down of the pound was ill advised?

Mr. Shore

I am not here to speculate about the downward movement of the pound, but it is inevitable that with differential rates of inflation there will be exchange rate adjustments. Such exchange rate adjustments have the advantage—together with their disadvantages—that they help to keep Britain's exports competitive.

Mr. Higgins

The Secretary of State's answers reinforce our view that he is not taking the lead in formulating any EEC trade position that we and, I believe, hon. Members opposite would like him to do. Last year he said that the only way out of the crisis into which Britain had been plunged was to withdraw from the EEC. Is that still his view?

Mr. Shore

I accept, as I have said, and as I said at the time, the decision of the British people. The EEC has a trade policy, which is stated in many of the regulations and directives and other arrangements made by the EEC, and those obligations are fulfilled by us, as they are by other members.