HC Deb 27 July 1981 vol 9 cc810-2
11. Mr. Gwilym Roberts

asked the Secretary of State for Trade what are the latest figures available for the balance of trade with Japan; what steps he is taking to improve this balance; and if he will make a statement.

13. Mr. Kenneth Carlisle

asked the Secretary of State for Trade what measures are being taken to improve the balance of trade with Japan.

20. Mr. Chapman

asked the Secretary of State for Trade if he will make a statement on trading between the United Kingdom and Japan, including the value of imports and exports between the two countries during the last 12 months for which figures are available.

22. Sir David Price

asked the Secretary of State for Trade what progress he is making in conjunction with other European Economic Community countries to limit the disruptive effect of Japanese imports into member countries.

Mr. Biffen

In 1980 United Kingdom companies exported to Japan goods worth £597 million; imports from Japan amounted to £1,712 million. The deficit on visible trade was therefore £1,115 million, partly offset by a surplus of some £200 million on invisible trade.

The Government have taken a prominent part in forming the European Community's trade policy towards Japan, which called for moderation of Japanese exports to the Community and an increase in imports by Japan of Community products. Bilateral and Commission representations have led recently to undertakings by Japan, which we welcome, to moderate car exports to the Community in 1981 and to increase imports of manufactured goods from the Community. The practical effect of these undertakings on Japanese imports and exports will be closely monitored.

Mr. Roberts

Will not the Secretary of State accept that Japanese success is based, on the one hand, on Japan's co-ordinated and far-seeing export policy and, on the other, on rigid protection of its home market? Unless Britain adopts the same type of initiative and protectionism for its home market, large sections of British industry—regardless of any pseudo agreement with the Japanese—will completely disappear.

Mr. Biffen

I cannot accept the proposition that a substantial extension of protection would enhance British industry's virility.

Mr. Carlisle

Is my right hon. Friend aware that Japan has a 40 per cent. tariff against, for example, confectionery and biscuit imports from Britain and is substantially hindering our export of those products? Does not my right hon. Friend think that if Japan wants to export its manufactured products to Britain it should be willing to lower those punitive tariff rates on our exports to Japan?

Mr. Biffen

Yes, I do.

Mr. Chapman

Further to the point made by my hon. Friend the Member for Lincoln (Mr. Carlisle), does my right hon. Friend agree that, notwithstanding the different tariffs, it is important that the Japanese should allow us the same conditions of access as we allow Japan on such things as product safety and specification? Is not that a problem that the Government must face?

Mr. Biffen

I am not sure how much of the problem lies in the formal existence of restraints within Japan and how much of the problem is culturally related, in that, in the absence of constraints, the Japanese are still determined to buy Japanese.

Sir David Price

I apologise for not being in the Chamber for my right hon. Friend's substantive reply, but I did not know that he would answer my question so soon. As for the balance of payments, does not my right hon. Friend agree that we are now more than £1 billion in deficit to the Japanese and that the EEC as a whole is nearly £4 billion in deficit? Despite what my right hon. Friend may say about cultural lags in Japan, has not the situation gone on for too long? Will he follow not EEC or British rules but French rules for coping with Japanese imports?

Mr. Biffen

I should like to receive a little advice from my hon. Friend on what constitutes the nuances of French rules. However, I am certain that the present imbalance will give rise to continuing anxieties between the OECD countries and Japan and that it cannot be allowed to continue.

Mr. J. Enoch Powell

Is there any good reason why Britain's trade account with any one country should balance?

Mr. Biffen

Absolutely none. I am surprised that the right hon. Gentleman, knowing my prejudices just as I know his, should ask me that question. We are confronted by an assault from Japan's exporting industries on a scale and a narrowness that gives rise to intolerable economic and social dislocation in the various economies of the West.

Mr. Straw

Given the point made by the hon. Member for Eastleigh (Sir D. Price), is it not a fact that the French Government have clearly directed—rather than pussy-footing around with negotiations with the Japanese over the level of car imports—that not more than 3 per cent. of France's market should be taken by Japanese cars? Given the cultural difficulties that the Japanese have in importing goods from Europe, is not the only action that we can take tough action of the kind that the French and Italians have taken?

Mr. Biffen

The actions of France and Italy are different in character. Italian action proceeds under trade regulations that are incorporated into Community law. The French have applied an administrative procedure which, were it to happen in Britain, would give rise to so much discretionary power on the part of civil servants that it would be rightly challenged in the courts.

Sir William Clark

Does not my right hon. Friend agree that the Japanese have an advantage over us and other Western countries in that their defence expenditure is much lower, because of the peace treaties? If that is so, will my right hon. Friend urge the Government to press the Japanese to increase their overseas aid and thus to take some of the responsibility away from Western countries?

Mr. Biffen

I am certain that if Japan had a defence budget that was analogous to the budgets of many of the other OECD countries Britain would probably be a supplier—given our acknowledged skills in providing defence equipment—to Japan. That is a fact of life.

Mr. John Fraser

If the Japanese continue to increase their exports to Britain or fail to take more exports from Britain is there any reason why, ultimately, we should not emulate the Italians and have unilateral controls?

Mr. Biffen

Any action would probably be undertaken in concert with our trading partners in the OECD.