HC Deb 10 December 1986 vol 107 cc338-9
13. Mr. Forth

asked the Secretary of State for Trade and Industry if he will make a statement on his recent visit to Japan.

Mr. Channon

My talks in Tokyo with Prime Minister Nakasone and other Ministers covered a range of trade and industrial matters. In particular, I underlined the need for urgent action to correct Japan's massive trade surpluses and to remove trade frictions such as the discriminatory taxation of imported alcoholic drinks. I also discussed ways of increasing British exports and improving access to the Japanese financial markets.

Mr. Forth

I very much welcome my right hon. Friend's comments. Can he give the House any further reassurance about the steps that the United Kingdom Government or the European Economic Community can take to guarantee fairer terms and a fairer balance of trade between our country and Europe on the one hand and Japan on the other?

Mr. Channon

There are several things going on which lead to there being more hope on this front. I do not wish to overstate the case.

Mr. Evans

The right hon. Gentleman has been saying that for seven years.

Mr. Channon

Yes, and before then, too. It has been said for a great deal longer than that. The hon. Gentleman should not imply that it is all the fault of one side of the House.

In answer to my hon. Friend's question, as he will know, the Community has already opened a GATT action on alcoholic drinks. We may have to consider further action under GATT if we do not obtain satisfaction.

Mr. Roy Hughes

Does the Secretary of State appreciate that Japanese industry has been successful because the Japanese have been wise enough to invest in their industry and in new techniques, whereas our steel industry, for instance, suffered years of neglect under private ownership? Is that not a good reason for the Secretary of State to have second thoughts about any rash privatisation scheme?

Mr. Channon

I agree with much of the first part of the hon. Gentleman's question, but I certainly do not agree with the second part. When I recall that when the Government came to office the British Steel Corporation was losing about £600 million a year, I find the hon. Gentleman's remark astonishing.

Several Hon. Members

rose—

Mr. Speaker

I call Mr. Beaumont-Dark.

Mr. Beaumont-Dark

God bless you, Mr. Speaker.

Does my right hon. Friend accept that, for the past seven years, we have been promised that, in one way or another, the Japanese will do better? The more Mr. Nakasone weeps about wishing to be loved, the more the balance of trade goes against us. Have we told the Japanese that we are prepared to take swift and strong action to stop one industry after another being ruined by Japan's unfair trade practices?

Mr. Channon

My hon. Friend will understand that I have made no rash promises to the House—[Laughter.]Nor do I think that is an especially funny remark. I am trying to be absolutely frank and realistic. My hon. Friend is entirely right to make those comments, which have widespread support in the House. As to the general position, we shall have to take action under the GATT, perhaps on a range of matters. As for the specific issues, we may have to consider ensuring reciprocity in financial services. I shall have reciprocal powers to deal with this matter early next year and I shall not hesitate to use them if we do not get proper access to the Japanese financial markets.