HC Deb 12 March 1979 vol 964 cc19-20
15. Mr. Shersby

asked the Secretary of State for Trade what is the value of British exports to China for the latest 12-month period for which figures are available; and what are the prospects for increasing trade during the next 12 months.

Mr. John Smith

The value of United Kingdom exports to China for the year ending December 1978 was £91,093,000. Following the signing of the economic co-operation agreement during my right hon. Friend the Secretary of State for Industry's recent visit to China, there are excellent prospects for a considerable increase in our trade with China, not only over the next 12 months, but increasingly in the longer term.

Mr. Shersby

Is the Secretary of State aware that the announcement of increased prospects of trade with China is welcome? Will he say exactly what orders have been placed? What is proposed in terms of the line of credit? Will that involve any buy-back arrangements?

Mr. Smith

The agreement that was reached by my right hon. Friend was an economic co-operation agreement, which creates the framework for our future commercial relationships with China. During his visit, leading representatives of British industry made significant progress towards achieving contracts, although I do not think that any were signed. We have made arrangements for credit under ECGD. The question of buy-back arrangements is always a problem when dealing with State trading companies, and that will have to be resolved in the context of each individual contract.

Mr. Norman Atkinson

It is true that an agreement has been signed which spells out economic co-operation for the future, but will my right hon. Friend now confirm that, because not one hard contract has been signed between the two countries, the view taken by the technical representatives who were in China is that those contracts are never likely to be signed and that the co-operation agreement is not worth the paper that it is written on?

Mr. Smith

I do not think that my hon. Friend does a great service to British industry, and to the great efforts that are being made to secure contracts in China, by statements of that kind. I refer him to the views of the publicly-owned industries, particularly the National Coal Board and the British Steel Corporation, which have very high hopes of increasing trade with China.

Mr. Blaker

Will the Secretary of State give an assurance that the official export credit arrangements for exports to China are at least as favourable as those in relation to exports to the Soviet Union, bearing in mind that the latter is hostile to us whereas China is not?

Mr. Smith

I do not want to enter into arguments as to the relative merits of trade with the Soviet Union and China. However, I can tell the hon. Gentleman that the Government have expressed their willingness to support credit of up to £2.5 billion until 1985.