HL Deb 20 December 1955 vol 195 cc335-6

My Lords, I beg to ask the Question which stands in my name on the Order Paper.

[The Question was as follows:

To ask Her Majesty's Government if, with regard to O.E.E.C. resolution for the discontinuance by 31st December, 1955, of export subsidies by participating countries, they are able to report notification by France that she is by the year-end to conform to the Agreement.]


My Lords, by the decision of the Council of the Organisation for European Economic Co-operation to which my noble friend refers, most members undertook to discontinue by the end of this year certain types of artificial aids to export. In the case of France, however, the date for the application of the decision was left to be decided by the Council in the light of a report on the economic circumstances of France. This report was submitted last September and the Organisation is now studying it. Her Majesty's Government will continue to impress upon France the desirability of giving up these artificial aids to exporters.


My Lords, the reply which the noble Lord has given indicates that most countries have agreed to take action, but he referred specifically to France as acting in a way different from the rest. Therefore, I would ask the noble Lord this further question: if, as would appear, there is procrastination on the part of France, can he indicate any evidence of genuine intention on the part of France to conform to what the other nations have agreed should be done? Because the action of France, as our industrial competitor in those industries most affected, is causing the greatest difficulty and inconvenience to our exporters.


My Lords, I must confess that the action of France has not been everything that could have been wished. The French Government have, however, announced and reported to the Organisation some reductions in the rebate given to exporters of certain turnover taxes. This change is welcome: but it is not clear that the rebates in question were, in fact, covered by the Council decision or contribute to carrying out the obligations which France has been repeatedly asked to undertake.


My Lords, seeing that this continuance reacts injuriously on British exports, can the noble Lord not state a time by which the French Government must abide by the Articles under which we are acting?


My Lords, if I am right in assuming that Her Majesty's Government had some success in persuading Western Germany to give up these practices, what will be the effect on the Continent of Europe if France carries on with her present attitude? May I also ask the noble Lord this question? As our export industries are in such a precarious state at the present time, what will be the Government's reaction, when they find failure staring them in the face, to their laudable but vain efforts to get other nations to give up subsidising exports in direct competition with ours?


My Lords, may I first answer the supplementary question of the noble Viscount, Lord Elibank? It is easy to name a date, but it is not so easy to make France adhere to it. All we can do is to continue, as we have in the past, to bring pressure to bear on France to make her see the necessity for honouring her European obligations. The noble Lord, Lord Lucas of Chilworth, asked me what would be the effect in West Germany, which has agreed to abandon these practices. The point is a valid one. I think the effect will be an unhappy one. As to his remark about failure, we prefer to think that, if we persevere in our present policy, we shall eventually achieve a greater measure of success. If failure is to occur, we must put of that unhappy day until we have to meet it. In the meantime, we propose to go on with our present policy as best we can.