§ 2.40 p.m.
VISCOUNT ELIBANKMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government whether, having regard to the statement by the Chancellor of the Exchequer on 17th April that to meet the large increase in the import bill and our other commitments we needed a substantial increase in exports but did not get it, they will initiate in COCOM at an early date steps to abolish—except for arms, munitions, military equipment and machinery specially designed for their production—the embargo on exports to China and other Eastern bloc countries which seriously hampers British exporters in those markets.]
§ THE JOINT PARLIAMENTARY UNDER-SECRETARY OF STATE FOR FOREIGN AFFAIRS (THE MARQUESS OF LANSDOWNE)My Lords, the Embargo List is kept constantly under review, in consultation with our Allies. As the noble Viscount is well aware, the List is confined to items of strategic significance and does not appreciably inhibit trade with the Sino-Soviet bloc. Such trade has been expanding steadily 748 during recent years, and is limited more by the amount of sterling available to the bloc countries than by these controls.
VISCOUNT ELIBANKMy Lords, I beg to thank the noble Marquess for his Answer. Arising directly out of it, is he aware that in 1956 the Government decided, in the face of opposition from America, to introduce the exceptions procedure, to the great advantage of British exports with China? And is he further aware that in 1957 the Government decided to part company with America in so far as COCOM was concerned and to reduce the China embargo, with the result that British exports to China increased from approximately £10 million per annum to over £30 million per annum to-day? Would the noble Marquess be kind enough to suggest to his right honourable friend the President of the Board of Trade that he should again adopt what has now become a traditional British solution to these problems?
§ THE MARQUESS OF LANSDOWNEMy Lords, I looked out some figures of our trade, as I thought they would be of interest to the noble Viscount particularly. In 1959, our exports to China were running at £24.4 million, and by 1960 they had increased to £31.4 million. As I said in my original Answer, the COCOM restrictions really are not an inhibition in our trade. The principal inhibition is the lack of sterling. I think the noble Viscount is well aware of that.
§ BARONESS SUMMERSKILLMy Lords, may I ask the noble Marquess to define in some detail articles of strategic significance?
§ THE MARQUESS OF LANSDOWNEI think the noble Baroness knows what that term means. It means, surely, certain items that it would perhaps not be desirable for these countries to hold. I think the noble Baroness knows quite well what I mean. The list is being steadily reduced, though there may Abe additions made to it as new inventions become available.
§ BARONESS SUMMERSKILLWhat I meant was: to what extent are they raw materials?
§ THE MARQUESS OF LANSDOWNEThey are not raw materials.
§ LORD HENDERSONMy Lords, may I ask the noble Marquess whether there is a difference of opinion between this country and America as to the Embargo List? My noble friend has provided for the exclusion of what might be called security items; but, surely, there are many other items which ought not to be excluded on grounds of security. We recognise China, and America refuses to recognise China. Are we to be governed by American requirements in this matter of trade?
§ THE MARQUESS OF LANSDOWNEI quite appreciate the point the noble Lord is making. As the noble Lord knows, the Embargo List is an international list agreed by us all. It has been reduced from 350 items in 1954 to 20 items at the present time.
VISCOUNT ALEXANDER OF HILLS-BOROUGHMy Lords, I wish to ask a question on that point, if I may. We are glad to hear the figures as to the improvement given in reply to the noble Viscount who put the Question. But is it not a fact that, having regard to the two speeches that President Kennedy has recently made called "Pan America" with regard to the possible development of an American Common Market like the Six over here, we need something special to step up our exports? And ought not this matter to be entirely reconsidered, so that we may certainly improve upon the disastrous results last year in our balance of payments?
LORD HAWKEMy Lords, is it not a fact that the Chinese capacity to import more depends entirely on whether they can get some more credits from Russia? The position of their credit, in view of the need to import heavy shipments of wheat, is a very parlous one.
VISCOUNT ELIBANKMy Lords, may I ask the noble Marquess a further question with reference to what he has said? I repeat the words of Mr. Erroll in the House of Commons yesterday—he is a Minister, so I may quote him. He said that the controls are still necessary, and they are not a significant factor in trade. That, with great respect, is what the noble Marquess said. But, to take the electronics industry, is he aware that the Chinese do not apply for electronics from this country? They 750 do not come into this market, because they know what the answer will be; but they are getting them elsewhere. Why should not British manufacturers of electronics be able to supply them as well as other countries?
§ THE MARQUESS OF LANSDOWNEMy Lords, I do not think that I can usefully add anything to what I have already said, but I should like to say to the noble Viscount how glad I am to see him again in robust health and again attacking me.
§ THE EARL OF LUCANWould the noble Marquess agree that the sum of his replies to the noble Viscount's Question is that it has been answered in the negative?
§ THE MARQUESS OF LANSDOWNEI think that was rather sneaking up on me on the inside. I will certainly take note of what the noble Viscount has said.
§ VISCOUNT ALEXANDER OF HILLSBOROUGHIn that case, may I say how happy we are to see the Foreign Secretary in his place, and I hope that he has been taking due note of the pros and cons which have been put to your Lordships.