Japan (Hansard, 22 December 1982)

§ 48. Sir David Price
asked the Secretary of State for Foreign and Commonwealth Affairs what decisions have been taken at the Foreign Affairs Council of the European Community on ways and means of improving commercial relations between Japan and the Community.

§ Mr. Hurd
The Foreign Affairs Council stressed the urgent need for effective action by the Japanese Government. A number of decisions were taken, including a move to the second stage of the GATT dispute settlement procedure, an extension of import surveillance and a demand for effective and clearly defined restraint of Japanese exports in sensitive sectors. The Commission affirmed its willingness to begin safeguard action for sensitive products in accordance with the appropriate regulation. The full text of the Council's conclusions is available in the Library.

§ Sir David Price
Is my right hon. Friend aware that there is a growing feeling throughout Europe that trade between European countries and Japan is too much a one-way business? Is he further aware that any and every action that the Council of Ministers can take will have the full support of the British people?

§ Mr. Hurd
I agree with my hon. Friend about that feeling. I believe that the Foreign Affairs Council made progress—not before time—in getting the European act together, so as to bring effective pressure to bear on the Japanese.

§ Mr. Cryer
Are the Japanese exercising effective voluntary restraint over the export of motor vehicles to this country? Does the Minister agree that restraint should also be exercised with regard to the import of Common Market vehicles into this country and that the real cause for concern is our massive deficit in manufactured and semi-manufactured goods with the Common Market? What does he intend to do about that?

§ Mr. Hurd
One-quarter of our total imports from Japan, including cars, are now covered by inter-industry understandings, and I understand that those agreements are respected. As the hon. Gentleman well knows, the position with regard to imports from our EC partners is entirely different. I do not understand how he expects us to restrict British customers buying from our partners while expecting our partners to go on buying British.

§ Mr. John Townend
In view of the astronomical balance of payments deficit between this country and Japan, does my right hon. Friend agree that a time limit should be set for the opening of the Japanese market to British goods and services, and that if Japan has not acted within that time we should take retaliatory action, as the French have done?

§ Mr. Hurd
I am not sure that the French action will prove particularly effective. My hon. Friend is entirely right, however, in saying that one of the prongs of our policy must be to ensure a proper opening of the Japanese market with the shortest possible delay so that Japan plays a fair part in the international system to which it belongs.

§ Mr. McNally
Is the Minister aware that his statement resembles many made to the House in the past decade? Before such a time limit is imposed, as many Members on both sides believe that it must be, will he arrange a meeting with the Japanese, at the highest level, to impress upon them that time is running out for them in their trading and that the operations now being suggested will lead to a spiral of protectionism? Does he agree that top level talks on trade are now urgently necessary?

§ Mr. Hurd
Certainly there in urgency. Such high level talks have taken place in the past, and no doubt there will be others in 1983.