HC Deb 02 April 1998 vol 309 cc1410-1
17. Mr. Geraint Davies

If she will make a statement on the priority her Department attaches to promoting competitiveness in Europe during the British presidency of the European Union. [35989]

Mrs. Beckett

European competitiveness is a key DTI priority for the UK presidency, just as it is in our policies within the UK. On 11 March, I addressed a debate in the European Parliament on this issue, and next month, when I chair the Industry Council, we shall be having the first full debate on European competitiveness, including how industry and Government can work together. A particularly important feature of our approach to competitiveness is the improvement and completion of the single market.

Mr. Davies

Does my right hon. Friend agree that exchange rates largely link to external factors in Europe, Asia and Japan, and that the proportion of exporters that are showing a dip in sales is the same as the proportion that are showing lower input costs in terms of raw materials? Does my right hon. Friend agree that about a third of manufacturers serving the domestic market are in boom? Does she agree also that exporters would be best advised to focus on higher productivity and better product differentiation, and then to focus on the home market? In no circumstances should we expose the wider economy to the risk of inflation because of the short-term pain of some exporters.

Mrs. Beckett

My hon. Friend is entirely right to identify that the overall position is much more complicated than the Conservatives seek to pretend. He is also right that our consistent advice to manufacturers and others has been that Britain's long-term competitiveness lies in the pursuit of quality and high added value rather than in simply attempting to compete on price. On all these issues our message has been consistent, and it has been of assistance to people in dealing with the present circumstances with the level of sterling.

Mr. Garnier

What does the President of the Board of Trade consider to be the pound's optimum level against the deutschmark to promote competitiveness?

Mrs. Beckett

I do not think that anyone would attempt to answer such a theoretical question. I simply remind the hon. and learned Gentleman that neither sterling nor interest rates are yet at the level that they reached under the previous Government, which was the result of a deliberate act of policy.

Mr. Campbell-Savours

May I ask my right hon. Friend a question about competitiveness among Europe's airline operators? Can she give an assurance that British Airways, with its new cut-price operation, will not be allowed to drive existing cut-price airline operators out of business? Clearly, that would not be in the public interest.

Mrs. Beckett

I am always cautious about being drawn into comment on competition issues in the House. The Government have not only advocated and pursued a policy of strong and fair competition but will continue to do so.

Madam Speaker

Sir Teddy Taylor.

Sir Teddy Taylor

Does the Minister agree—

Madam Speaker

Sir Teddy, I am calling you for Question 18.

Sir Teddy Taylor

It is Question 17.

Madam Speaker

You have Question 18. Either you want to put it or you do not.

Sir Teddy Taylor

Question 18. Yes, that is me.