HC Deb 06 February 1978 vol 943 cc1005-7
14. Mr. Tim Renton

asked the Secretary of State for Trade whether he is satisfied with the Government's progress in promoting free and fair international trade.

27. Mr. Higgins

asked the Secretary of State for Trade whether he is satisfied with progress in the present round of multilateral trade negotiations.

Mr. Dell

The Government's policy is to work for the maintenance of the open world trading system, though one adapted to the realities of the present economic situation. The success of the multilateral trade negotiations is a central element in this policy, and I am glad to say that the major participants have agreed to enter the substantive phase of the negotiations on the basis of a number of working hypotheses relating to the various matters at issue. I hope that it will now be possible to draw the negotiations to an early and positive conclusion.

Mr. Renton

Will the right hon. Gentleman expand that answer in layman's language? Can he say simply what initiative the Government will take in the mulilateral trade negotiations in Geneva that might combat the growing trend towards protectionism in the Western world and lead to a further liberalisation of world trade?

Mr. Dell

I think that the hon. Gentleman will be able to understand the answer when he reads it, even if he did not understand it when he heard it. The initiatives which the Government are taking in respect of these negotiations have been incorporated in the mandate of the European Community which will be negotiated at Geneva. They include such matters as a reduction in tariffs on a harmonising basis, a selective safeguard, which we think is essential in the world as it is so as to enable selective action to be taken, and a break in the phasing of tariff reductions. Those are the main elements in the negotiating mandate.

Mr. Higgins

What proposals has the right hon. Gentleman put forward for the reform of Article XIX of the GATT in these negotiations? Can he confirm, with regard to the CAP, that there will be no inhibitions whatsoever on the British Government in discussing that either in the plenary or the committee sessions?

Mr. Dell

With regard to Article XIX of the GATT, we have proposed a selective safeguard; in other words, a safeguard which can be operated on a discriminatory instead of a non-discriminatory basis.

With regard to agriculture, certain initial proposals have been made by the Community. We accept that these negotiations cannot be used as a way of undermining the principles of the CAP, but we hope that there will be movement in this area towards an agreement satisfactory to the United Kingdom.

Mr. Gwilym Roberts

Does my right hon. Friend accept that the very existence of the EEC and its protective habits are contrary to this philosophy of free trade? Will he therefore seriously look again at this matter of the CAP, which in itself is the embodiment of protectionism?

Mr. Dell

Sometimes I hear that the EEC is protectionist, and sometimes I hear that it is too devoted to free trade. It is sometimes difficult to choose between the two. I think that the EEC operates in world trade in the way that most individual participants in world trade do, which is to help its industries, and it is not untypical that the agriculture industry should be assisted. It is not so easy to get agricultural products into the United States, as many suppliers of agricultural products sometimes find.

Mr. Nott

Does the right hon. Gentleman agree that non-tariff barriers are probably a much greater cause of growing world protectionism than tariffs themselves, and in particular the subsidisation of declining industries, such as shipbuilding, and political pricing? Do the Government agree with the draft guidelines which have been produced on non-tariff barriers, and will they be supporting them in the negotiations which are going on in Geneva?

Mr. Dell

There are no firm guidelines on non-tariff barriers. Various informal documents are being circulated, and these are the subject of discussion. Obviously it would be useful to make an advance in dealing with non-tariff barriers. The hon. Gentleman will realise that there is probably no aspect of international trade in which it is more difficult to make progress, because of the difficulty of surveying what is happening and ensuring that people are adhering to the rules laid down.

Mr. Jay

Why do not the Government use these negotiations to help in reforming the CAP, which is the most extreme form of protectionism in the world?

Mr. Dell

Relative forms of protectionism in agriculture might be more difficult to establish than my right hon. Friend assumes. I hope that some progress in dealing with the agriculture issue will be possible and that some greater access will be permitted, and that we shall be able to do something about trade in third markets, but I think that it would be wrong to exaggerate the possibilities created by these negotiations for changing the CAP.