HC Deb 27 March 1985 vol 76 cc460-2
2. Mr. Chapman

asked the Secretary of State for Trade and Industry if he will make a statement about the balance of trade with the Union of Soviet Socialist Republics.

The Minister for Trade (Mr. Paul Channon)

In 1984, exports from the United Kingdom to the Soviet Union increased by 65 per cent. to £735 million, while imports from the Soviet Union rose by 17 per cent. to £854 million, producing a balance in the Soviet Union's favour of £119 million.

Mr. Chapman

I welcome the reduction in the imbalance of trade between the United Kingdom and the Soviet Union compared with previous years, and recognise that many of the imports are processed for re-exporting from this country. However, will my right hon. Friend assure the House that countries entering into the COCOM agreement to restrict the export of certain technologies and products to Eastern bloc countries abide by that agreement, and that it is not unilaterally broken at the whim of any one country?

Mr. Channon

Yes, I can give my hon. Friend that assurance. COCOM works by unanimity. I know of no example of a country trying to do what my hon. Friend is protesting about. If he has any evidence that it was being done, we would investigate the complaint as a matter of urgency.

Mr. James Lamond

Will the Minister take a look at the list of items which may not be exported to the Soviet Union? One firm in my constituency, which is engaged in high technology, is prevented from exporting commercial packages and microchips to the Soviet Union, despite the fact that the same products can be bought virtually over the counter in London. There is no doubt that the restrictions are circumvented in that way. Would it not be better to reconsider the list and open up the possibility of trade to all such firms?

Mr. Channon

There must be some restriction on exports to Soviet bloc countries. The list was reviewed last year, and I hope to make an order setting out a new list, which will be laid before the House in the very near future. The list is kept continually under review. If there are any specific points that the hon. Gentleman wishes to raise, perhaps he will get in touch with me.

Mr. John Browne

If the Soviets are to restore growth to their economy, will they not have to accept some forms of financial incentive and decentralisation, and will they not also require massive imports from the West? Will that not therefore offer great opportunities for British manufacturers, financiers and traders, outside the restrictions on strategically important high technology exports?

Mr. Channon

My hon. Friend is quite right. Exports from the United Kingdom to the Soviet Union increased by 65 per cent. last year—an extremely good figure. When Mr. Gorbachev was in London, he said that he hoped that over the next few years there would be an increase of another 40 to 50 per cent. The chances are very good indeed.

Mr. John Smith

Does the Minister agree that, following the election of Mr. Gorbachev in the Soviet Union, the time is right—[HON. MEMBERS: "Election?"] Mr. Gorbachev was elected by the Praesidium. It would be helpful if Conservative Members paid some regard to the diplomatic niceties, if they wish to advance our trade with the Soviet Union.

Would it not be advisable for the Minister and his colleagues — the matter is probably beyond the imagination of the Secretary of State — to mount a special trade mission to the Soviet Union to follow up what one hopes will be the beneficial results of a thaw in the political climate? Can the Minister say what were the results of the discussions with Mr. Gorbachev on his recent visit?

Mr. Channon

Yes. When I saw Mr. Gorbachev in December we discussed the possibility of drawing up a new programme for a long-term trade agreement between our countries. I look forward to seeing his colleagues, who are coming in June for the United Kingdom-Soviet joint trade commission. I hope that we shall draw up a new trade document then. We shall certainly be prepared to consider further exchanges, either by trade missions or some other way, to increase the already great increase in British exports.