HC Deb 02 July 1979 vol 969 cc893-5
13. Mr. Neubert

asked the Secretary of State for Trade by how much in money terms imports exceeded exports in the first five months of this year.

14. Mr. Knox

asked the Secretary of State for Trade what was the United Kingdom's current account deficit in the most recent month for which figures are available.

Mr. Parkinson

The trade figures so far this year have been distorted as a result of industrial action, and need to be interpreted with caution. The published figure of a visible deficit of £1,693 million in the first five months of this year overstates the underlying deficit, while the published current account deficit of £75 million in May is likely to understate the underlying position.

Mr. Neubert

Are there not grounds for believing that under-recording, as a result of the computer operator's strike, is masking a deficit on visible trade of more like £2 billion rather than the official figures that my hon. Friend has just given? Is it not clear that one of the legacies inherited by this Government is a very serious deterioration in non-oil trade? What are the prospects for the year as a whole?

Mr. Parkinson

My hon. Friend is right to point out that the figures I have just reported to the House are part of a legacy which the previous Government left us. It is not possible to predict the annual outcome on the basis of the present figures because the figures are so distorted—by the strike and by other factors, such as stocking up, and the distorting effects of our trade with Iran and Nigeria.

Mr. Knox

How do the figures square with the claim made by the former Chancellor of the Exchequer that the new Government had inherited a surplus on the balance of payments?

Mr. Parkinson

I am not prepared to waste my time or that of the House trying to justify the statements of the former Chancellor.

Mr. Jay

Has the Minister noticed that the worst visible deficits at present are in manufacturing trade with the EEC Six? Is he aware that this deficit did not exist before the Tories took us into the EEC?

Mr. Parkinson

The right hon. Gentleman is right—the major part of the deficit is our underlying deficit with the EEC. But that is hardly surprising since the EEC is far and away our biggest trading partner, representing more than 40 per cent. of all our trade. The proportion of our imports from the EEC covered by our exports is improving.

Mr. Robert Atkins

Is the Minister aware of the increasing number of Christmas cards, subsidised by the Russian Government in order to gain precious foreign exchange, that are being exported to—nay, dumped in—this country to the substantial detriment of British manufacturers and those whom they employ? Does he intend to investigate this state of affairs?

Mr. Parkinson

My hon. Friend will not be surprised to hear that that was the first time that particular problem had been brought to my attention. I assure him that, having learned about it. I shall investigate it.

Mr. Leighton

Does the Minister agree that if there is an increasing switch of purchases from British factories to EEC factories it will lead to growing unemployment and de-industrialisation in this country? If it is right to impose quotas on Japan, is it not right to impose them also on countries such as Germany?

Mr. Parkinson

It would be illegal because of our treaty obligation, which prevents us from doing so. The hon. Gentleman must not just look at the areas in which we do not do well. There are many other areas in which we do extremely well, and if others adopted the attitude that he is advocating now world trade would grind to a halt.