§ 17. Mr. Freeman
asked the Chancellor of the Exchequer what representations he has received from the Confederation of British Industry in 1985 on the United Kingdom joining the European exchange rate mechanism.
§ Mr. Ian Stewart
The CBI has stated that its present view is that the United Kingdom should join the exchange rate mechanism of the European monetary system.
§ Mr. Freeman
Does my hon. Friend agree that our excellent export performance can be improved only if business men believe that we have stable interest rates, particularly in relation to our European partners? Does he also agree that one way of achieving stable exchange rates is for Britain to announce at an early moment that we will join the exchange rate mechanism?
§ Mr. Stewart
My right hon. Friend the Chancellor explained a while ago that the Government's policy is to keep the question of membership of the EMS under review and that we have not judged that circumstances are right for us to join. My hon. Friend referred to both interest and exchange rates. The greater the stability with one, the greater the likelihood of instability with the other.