§ 3. Mr. Michael Morrisasked the Secretary of State for Trade what is the value of trade done to date with the USSR under the £950 million trade pact as announced by the right hon. Member for Huyton (Sir H. Wilson) in 1975.
§ The Secretary of State for Trade (Mr. John Smith)The total value of contracts financed under the Anglo-Soviet agreement is now £444.4 million.
§ Mr. MorrisWhy has progress been slow, particularly when the credit arrangements were so beneficial to the USSR?
§ Mr. SmithIt is disappointing that not more contracts have been received under the terms of the agreement. One reason may be that the Soviet Union is coming 1003 to the end of its current five-year plan. A number of fairly large projects are presently under consideration. The hon. Gentleman should bear in mind that this is not a uniquely favourable credit agreement. Our competitors have similar ones.
§ Mr. BlakerIf further contracts are to be signed under this line of credit, what is the Government's policy on the currencies in which such agreements are to be financed? If the currencies are either sterling or United States dollars, will that not involve a substantial burden on the British taxpayer, bearing in mind the big difference between the rate of interest which has to be paid on borrowed money and the rate of interest which would be charged on the line of credit for the Soviet Union?
§ Mr. SmithThis is a matter which has concerned the Government. The Soviet Union has already agreed to foreign currency financing for a major contract under the agreement. We hope that it will be possible to continue to arrange this for future contracts, as for similar exports to other countries. However, the ECGD has agreed that the Soviet Union may have the option to choose the currency in which finance is expressed.