HC Deb 15 February 1989 vol 147 cc310-1
14. Mr. Teddy Taylor

To ask the Chancellor of the Duchy of Lancaster what was the surplus or deficit in trade in manufactured goods with the European Economic Community and the rest of the world, respectively, over the most recent 12-month period for which figures are available.

Mr. Alan Clark

In 1988 United Kingdom trade in manufactures was in deficit by £12½ billion with the European Community and by £2 billion with the rest of the world.

Mr. Taylor

As the deficit with the EEC has increased steadily in every year since 1973 to its present horrific level and as that puts at risk the Government's successful economic policies, does the Minister agree that there is a case for a special detailed inquiry into what is going wrong in our trade with the EEC, whether it is non-tariff protection or something else? Does he agree that in view of the December 1988 figures, which were the worst in recorded history, with £3 of goods coming in for every £2 going out, there might be a case for replanning the Channel tunnel to have two tunnels going in one direction and one in the other?

Mr. Clark

Over the years I have got into enough trouble by commenting on the Channel tunnel to prevent me from doing so on the Floor of the House. The circumstances to which my hon. Friend has drawn attention cannot persist indefinitely. After 1992 the imbalances in that form will no longer exist. There is a school of thought which argues that after 1992 and the completion of the internal market, deficits will disappear in that form and the imbalances will be simply regional and sectoral.

Mr. James Lamond

Does the Minister understand that we know that he does not believe those views any more than we do? How do these disastrous figures square with the rosy picture that has just been painted about the alleged confidence of manufacturing employers in this country? When the Parliamentary Under-Secretary of State for Industry and Consumer Affairs says that his Department has received nothing but views of confidence from manufacturers, should not the hon. Gentleman tell him of the views he has received from textile manufacturers who, despite the increases in productivity and the investment that they have made, now find that this Government are the worst they have ever had to work under?

Mr. Clark

The hon. Gentleman does not do justice to the situation. Almost half our manufactured exports go to the Community, which is by far our largest single market. The level of confidence in the United Kingdom's economy and the amount of internal investment from, for example, the United States and Japan that it is drawing in, continuously—and now sharply—raises our level of manufacturing. It is probable—indeed, my right hon. Friend the Chancellor of the Exchequer expressed this opinion as recently as in the Autumn Statement—that this deficit will diminish over the medium term.

Mr. Churchill

Is my hon. Friend aware that, whereas private enterprise, particularly in the north of England, is well advanced in plans to take advantage of the opportunities afforded by 1992, the Government seem to have a long way to go yet in that direction? Adequate infrastructure should be in place by the time the Channel tunnel opens, so that we can run high-speed freight trains and passenger services. We also need an adequate motorway system to enable us to enjoy, and capitalise on, the benefits offered by the single European market. Will my hon. Friend have a word with our right hon. Friend the Secretary of State for Transport to ensure that proper progress is made?

Mr. Clark

I shall do so, but my right hon. Friend answers questions on this topic from time to time and I suggest that my hon. Friend addresses his questions directly to him.