HC Deb 19 June 1978 vol 952 cc16-8
10. Mr. Dykes

asked the Secretary of State for Trade when he intends next to attend a meeting of the Council of Trade Ministers of the EEC.

Mr. Dell

I regularly attend meetings of the EEC Foreign Affairs Council when trade matters are discussed. I shall be attending the Council on 27th June.

Mr. Dykes

As the detractors of our membership are continually talking about our so-called large EEC deficit, will the right hon. Gentleman at that meeting have a statistical discussion with his colleagues to remind them, and the House, that the gross amount of the so-called deficit is substantially netted down to a modest figure for real industrial imports once we have taken out food imports that are now coming from the EEC instead, other transactions and all the entrepôt trade that comes through Holland, for example?

Mr. Marten

If we take everything out, we shall be in surplus.

Mr. Dell

No, I shall not be discussing that matter because it will not be on the agenda. It is true that our trade figures are on a consignment basis. They almost certainly exaggerate the extent of our deficit with the Community.

Mr. Ioan Evans

Will my right hon. Friend discuss with the Trade Ministers the fact that under the common agricultural policy we have to purchase dairy products from within the Common Market rather than without, yet we have large stocks of coal in Britain and the other EEC countries are purchasing their coal outside the Common Market? It seems that we are losing on the roundabouts and on the swings.

Mr. Dell

It is true that one aspect of our membership of the Community is adherence to the common agricultural policy, which imposes upon us certain obligations. The House should be aware that the trade figures with the European Community, although there is undoubtedly a substantial deficit that we wish to reduce, are calculated on a basis that exaggerates the deficit. According to the trade statistics in 1977, among our imports from the European Community were significant imports of soya beans, cocoa butter, tea and tungsten. That is because they are on a consignment basis. I do not think that any hon. Member believes that these products are produced within the European Community.

Mr. Nott

With the benefit of hindsight, does the right hon. Gentleman think that he was rather ill-advised to make the comments that he did on the German Finance Minister's intervention at the recent Trade Ministers' meeting? Would not he do better to find common cause with Count Lambsdorff in his real concern that the industrial side of the Commission, under Commissioner Davignon, appears increasingly to become more and more interventionist, concerned with throwing up tariff barriers around the outside of the EEC? Does he agree with that process, which is accelerating? Would it not be better to support Count Lambsdorff rather than to make the sort of comments that he made about his intervention?

Mr. Dell

I supported a part of what Count Lamfdorff, the German Economics Minister, said at the meeting of the Council. I pointed out that I agreed with him entirely on the dangers of the existing open trading system. I object to having a finger pointed at certain countries—this applies to not only one country but others —for their protectionism when other countries are equally protectionist when it suits them.

I indicated—I hope in moderate language, as is my wont—that the Germans were somewhat protectionist in agriculture and showed signs of being protectionist in shipping. I said that we should try to discuss these difficult problems of maintaining the open trading system with a due appreciation of each other's problems. The policies of Viscount Davignon that we have adopted for textiles and steel are sensible. The European Community's steel policy followed certain initiatives from the United States. We are having to move to a world agreement on steel because of the great difficulties that everyone is facing in that area.

Mr. Nott

A moment ago the Under-Secretary of State said that he believed that the greatest scope for the increase of our exports and our trade was with the developing countries. However, the whole thrust of Davignon's policy is to increase cartelisation within the European Community and throw up tariff barriers against the imports of these countries into the EEC. Surely that must go against what the Under-Secretary of State was saying earlier.

Mr. Dell

My hon. Friend had in mind the opportunities for exports that exist, and from which we are gaining considerable benefit, from the oil developing countries. Undoubtedly there are certain problems that have arisen for European industry and American industry from the exports of certain developing countries. There are problems of over-capacity in steel and in other sectors. There is the problem of maintaining a domestic textile industry in Europe as in the United States. These are all problems that we have to address with great care and without assuming that in present economic conditions we can easily adjust into new employment opportunities those who would lose their jobs in existing employment opportunities. After all, we have a sufficiently high level of unemployment in the Western world at present not to assume that the adjustment process is as easy now as it once was.