HC Deb 29 January 1987 vol 109 cc480-1
13. Mr. Skinner

asked the Chancellor of the Exchequer what recent meetings he has had with the other Finance Ministers regarding financing of Third world debt; and if he will make a statement.

Mr. Lawson

The financing of Third world debt was among the matters discussed at the annual meetings of the IMF and World Bank in Washington last September, in which I took part.

Mr. Skinner

Is it not true that the Tory Government have double standards with regard to assisting the debtor countries in the world? Will the Chancellor admit that they were very quick to respond to the need for a massive loan to Fascist Chile and that, in 1986, they encouraged their friends in the City, to make a deal—by backdoor methods—to bail out the South African Government when they faced a £20 billion debt? They provided tax credit to the banks to bail out Argentina, but the poorest countries in the world have been left to fend for themselves.

Mr. Lawson

The hon. Gentleman is mistaken. Moreover, if he is concerned about the problem of indebtedness he should look much closer to home, at those Labour authorities reported on today by the auditors of local government for financial mismanagement and creative accounting on a massive scale.

Mr. Moynihan

Does my right hon. Friend agree that the existence of a discounted secondary market in debt offers substantial opportunities for the Government to use, this financial mechanism to fund developing countries programmes?

Mr. Lawson

My hon. Friend is right. The debt problem is still a very serious one, which all the major countries are addressing. A number of methods such as those that he has suggested need to be brought into play.