HC Deb 18 October 1976 vol 917 cc933-5
11. Mr. Rooker

asked the Secretary of State for Trade if he will make a statement on motor car imports from Japan during 1976.

21. Mr. William Hamilton

asked the Secretary of State for Trade what response he has had from the Japanese Government to his request for reductions in the numbers of cars imported from that country.

Mr. Dell

I have made clear to the Japanese authorities our concern about levels of car imports into this country. The Japanese industry told our industry in July that it did not foresee any conspicuous change this year in its share of the British market. I shall continue to keep a close watch on the figures.

Mr. Rooker

My right hon. Friend has made clear to the Japanese authorities, as his predecessor did a year ago, the Government's and industry's view, and yet Japanese imports are still increasing.

Mr. Speaker

Order. The hon. Gentleman is making a case. Will he please ask a question?

Mr. Rooker

Has my right hon. Friend given a commitment, as the present Secretary of State for the Environment gave to the Japanese almost exactly a year ago? Is my right hon. Friend satisfied that we should go on chatting to the Japanese, asking them not to import too much into this country and saying that otherwise we will take action when no action has ever been taken?

Mr. Dell

My hon. Friend is quite wrong in saying that no action has ever been taken. To begin with, exports of Japanese motor cars to this country are governed by an understanding reached with the British industry in July that there would be no conspicuous change in their share of the market. The trouble is that British industry has not been able to take advantage of what has been left in the market because of its own inability to supply, and the market has been taken up by European suppliers. The problem is one of making British industry more competitive so that it can take advantage of the opportunity created by the agreement with the Japanese industry.

Mr. Sims

Is the Minister aware of the Japanese Government's claim that if invisible trade is taken into account the balance of trade is more favourable to the United Kingdom than to them? Will he clarify the position to clear up the misunderstanding and discuss the matter with members of the Japanese delegation which is now in this country?

Mr. Dell

I am aware of the claims made by the Japanese authorities about this country's invisible earnings with Japan. We have examined the figures and find that they grossly exaggerate the position. It is true that our invisible income makes some contribution to cover the deficit in our visible trade, but it does not eliminate it and it probably does not reduce it by more than half.

Mr. Skinner

Does not my right hon. Friend agree that the question goes a little wider than blaming British manufacturers and partcularly British workers in the car factories? Are not the Japanese more shrewd than our people in that they adopt techniques and tests which prevent British cars from passing a hurdle which amounts to a tariff? Could we not act in a similar fashion in this country?

Mr. Dell

It is true that the operation of Japanese tests regarding pollution controls operate as a non-tariff barrier. We have been discussing this with the Japanese authorities and we would like to see a relaxation of foreign imports into Japan to improve the opportunities for foreign car exports to Japan. But the main problem in our relations with the Japanese is that they should import more manufactured goods from this country and from the rest of the world. This is a matter which we are discussing with the Japanese Government, and I took the opportunity this morning to impress that point at a meeting with Japanese industrialists. I think they are taking the point on board, but we shall have to watch the situation.

Mr. Shersby

Is not the best way of tackling Japanese penetration of the market an increase in efficient production in this country, particularly by British Leyland, and the elimination of non-tariff barriers? Does the Minister agree that the ambiguous statement made by his hon. Friend the Under-Secretary of State about import controls is likely to lead to further speculation against the pound?

Mr. Dell

I do not think that my hon. Friend made an ambiguous statement. The Government's position is clear. Of course we need to improve the competitiveness and efficiency of the British industry, and the Government are giving considerable help to British Leyland and Chrysler to that end. We want to see British industry taking advantage of the situation created by the agreement with Japan.