§ 33. Mr. Hal Millerasked the Lord Privy Seal, further to his reply to the hon. Member for Bromsgrove and Redditch, 21 January, col.255, whether the European Community has considered the implications of the agreement between the United States of America and Japan on limitation of motor car trade in its attempts to moderate Japanese exports to the Community.
§ Sir Ian GilmourThe Council of Ministers discussed that subject yesterday in Brussels and adopted a statement of which copies are being made available in the Library. The statement includes calls for an undertaking from the Japanese that there should be no diversion of Japanese cars to the Community following the United States arrangement and analogous measures for exports to the European Community, with special attention being given to member States facing particular difficulties. This includes the continued satisfactory operation of the inter-industry understanding for the United Kingdom.
§ Mr. MillerDoes my right hon. Friend accept that any such undertaking should be not merely on an industry-to-industry basis but should require some form of Government involvement, in view of the increased production in Japan and the risk of diversion to which he has referred?
§ Sir Ian GilmourMy hon. Friend will appreciate, as he has been taking a consistent interest in this issue for many months, that Community participation in these matters necessarily implies the presence of Governments and that matters are not left just to the trade.
§ Mr. StoddartIs the right hon. Gentleman aware that since 1973 British car exports to the EEC have halved and imports from the EEC have gone up by 54 per cent.? Does it not appear that the problems of the car industry rest more with our membership of the Common Market than with Japanese imports?
§ Sir Ian GilmourThere is an obvious logical fallacy M what the hon. Gentleman says, because the Community car industries are also suffering from Japanese competition. That wrecks the hon. Gentleman's logic.
§ Mr. Teddy TaylorIn view of the representations that the Government are rightly making to the Japanese about the impact on jobs of the terrible imbalance in trade and manufactures, will the Government also consider making similar representations to the Federal Republic of Germany as last year our deficit in manufactures with that country was twice that with Japan, according to the Minister's figures?
§ Sir Ian GilmourAs I explained to my hon. Friend in a written answer, there is a considerable distinction between our trade with Japan and our trade with Germany. Japan's trade surplus with the United Kingdom is concentrated in certain sensitive industrial sectors while the pattern of United Kingdom visible trade with Germany—which is our largest export market—is very different. No one could say that Japan is a large export market. Our deficit with Japan is more than twice our deficit with Germany, on a much smaller volume of trade.
§ Mr. Denzil DaviesIs it not true that, despite the fact that car imports from Japan have damaged our domestic industry, far greater damage has been inflicted by car imports from France, Germany and Italy? Is it not absurd that the EEC can seek an agreement with Japan on the import of cars but Britain cannot seek bilateral agreements with France, Germany and Italy to stop the damage where it is greatest?
§ Sir Ian GilmourIf the right hon. Gentleman thinks that imports are damaging, he is returning to the early eighteenth century and adopting a completely merchantilist position. He ignores the fact that the EEC is our largest export market. Does he really want to return to a regime of rigid import controls and bilateral trading such as his party once had? That attitude fits in badly with the Labour Party's pretended concern for the Third world.