HC Deb 21 November 1984 vol 68 cc291-2
14. Mr. Yeo

asked the Secretary of State for Trade and Industry whether he is in a position to authorise more credit for those countries which are successfully emerging from their debt crises.

Mr. Channon

I hope to be able to announce shortly that, for debtor countries which are rescheduling their debts, the Export Credits Guarantee Department will, in appropriate cases, maintain cover or resume it at an earlier stage than hitherto to support credit for goods which would contribute to the economic recovery of the debtor country.

Mr. Yeo

While it is essential to avoid providing irresponsible credit, which would only increase the risk of future defaults by developing countries, is it not very much in the interests of British exporters that adequate credit be provided to countries which are taking steps to emerge from their debt crisis?

Mr. Channon

Yes, my hon. Friend is quite right. We have such considerations in mind, and I hope shortly to be able to announce to the House in further detail what we propose to do. Both the considerations that my hon. Friend has mentioned are important. We must avoid further irresponsible lending which would put our credit insurers at greater risk, but we must also encourage British exporters by giving adequate credit in markets which are recovering.

Mr. Silvester

Bearing in mind the Minister's earlier remarks about the Export Credits Guarantee Department, will he confirm that he intends, not to impose a profit target on the department, but to maintain the objective of breaking even, taking one year with another?

Mr. Channon

The intention is to retain the target of breaking even. It is always difficult to achieve both our targets, because the second target is to promote British exports, and so the two are very often in contradiction

Mr. Speaker

Order. I remind hon. Members that the question is about debt crises.

Mr. John Smith

I welcome the Minister's remarks about the action that the ECGD will take in relation to certain countries with a debt crisis. Has not the time come for the Government, in association with other Western Governments, to take a much more imaginative eacl in trying to find an international solution to the problem of the debtor countries? We need a much more imaginative approach than the Government have been prepared to display so far in international forums.

Mr. Channon

I note what the right hon. and learned Gentleman says. He raises very wide considerations which are mainly within the province of my right hon. Friend the Chancellor of the Exchequer. I shall certainly ensure that they are conveyed to my right hon. Friend.