HC Deb 10 March 1981 vol 1000 c758

But Britain is not alone in facing these problems. In the spring and summer of last year, output fell sharply in six out of seven of the major economies. Unemployment rose by about 3 million in the OECD countries during 1980. In the American motor industry alone, almost 200,000 workers lost their jobs. The average OECD inflation rate remains in double figures. This year the output of the European Community as a whole is not expected to show any improvement over 1980.

A major cause of this world-wide setback is the enormous rise in oil prices in the last two years. The oil-producing countries of OPEC last year collected about 150 billion dollars more in export receipts than they did in 1978. That huge increase, and the surpluses that it created, mean that the rest of the world has had less to spend on other goods and services. At the same time, Governments have had to act firmly to counter the inflationary spiral set in motion by higher oil prices.

Those are the main reasons why the OECD has estimated that the national product of the industrial countries this year will be at least 6 per cent. lower than it would have been without the latest oil price increases. That represents a very large enforced reduction in sales and output. It has inevitably meant a big jump in unemployment. Because we are a trading nation, the fact that we have our own oil cannot protect us from the slowdown in many of the markets to which we sell around the world.