HC Deb 14 December 1983 vol 50 cc985-7
11. Dr. Roger Thomas

asked the Secretary of State for Trade and Industry what percentage of the United Kingdom's imports of manufactures from the European Economic Community is now covered by its exports to European Economic Community.

Mr. Trippier

In the third quarter of this year the coverage was 66 per cent. measured on a balance of payments basis.

Dr. Thomas

As the figures confirm our continuing deficit, does the Minister believe that we have benefited at all from a free, unprotected market for our manufacturing industry?

Mr. Trippier

Yes, I believe that we have benefited from membership of the European Economic Community. Other EEC countries are an increasingly important market for our exporters and now take 38 per cent. of United Kingdom manufacturing exports compared with 29 per cent. in 1970.

Mr. Dorrell

As the EEC is the largest single market in the world for manufactures, does my hon. Friend agree that it is essential to concentrate, not on cutting ourselves off from that market, but on making ourselves competitive so that we can win orders within it in open competition with the best in the world?

Mr. Trippier

I agree with my hon. Friend. In addition, we are attracting foreign investment, especially by American and Japanese companies. They are gaining access to the European market by building factories here, bringing jobs to industry which would go elsewhere if we were not in the EEC.

Mr. Nellist

Does the Minister agree that his figures, and the replies of the Secretary of State, show that the Government have changed Britain from the workshop of the world into the warehouse of the world? Instead of blaming the workers and low productivity, will he consider the fact that Germany, for example, invests £2.31 in manufacturing industry for every £1 that Britain invests? Does he appreciate that investment is the motive force for the production of jobs and goods?

Mr. Trippier

I do not recall blaming the workers in any of my answers. A major plank of the hon. Gentleman's party at the general election was that Britain should withdraw from the EEC, which turned out to be Labour's biggest own goal in June. Moreover, a recent House of Lords Select Committee report shows that the vast majority of industrialists favour staying in the EEC.

Sir Anthony Meyer

Does my hon. Friend agree that the United Kingdom traditionally has an adverse balance of trade with other advanced industrialised countries and that the coverage of imports by exports is far worse in the United States and Japan, which are the other two principal outlets?

Mr. Trippier

That is indeed so. Imports of manufactures have been growing faster than exports for some years, not only in the EEC but throughout the world. The way to reverse that trend is to improve British industrial competitiveness both at home and overseas.

Mr. Shore

Perhaps the Minister will stop emoting for a moment and think instead. Is he aware that his figure of 66 per cent. for the coverage by exports of British imports of manufactures from the EEC compares with 89 per cent. four years ago and 130 per cent. before Britain joined the EEC? In view of those two very different and far more favourable figures, how does he reconcile the claim that Britain's industry has become ever more competitive under the Conservatives with the fact that our export-import ratio in manufacturing trade with Europe has declined so seriously and has indeed halved since we joined the Community?

Mr. Trippier

As the right hon. Gentleman well knows, it is wrong to concentrate on one section of the current account. Oil and services must also be included. Increased exports of oil and services are inevitably accompanied by higher imports of manufactures. Despite that, however, there was a current account surplus of £1.2 billion in the first nine months of 1983.