§ 3.11 p.m.
§ LORD BARNBYMy 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 their information confirms the continual reports in the Press on the damage to British exports to South Africa and Portugal caused by deteriorating sentiment towards the United Kingdom; and whether, particularly, in view of the importance of trade with South Africa, our third largest export market, they realise the extent to which delay in a solution to the problem of the de facto Government of Rhodesia is contributing to this.]
§ LORD BESWICKMy Lords, our exports to Portugal in the period from December, 1965, to May this year, actually increased by £3.6 million over their level in the corresponding period 1964–65. Although our exports to South Africa in the same period fell by £2.3 million compared with the corresponding period, this was a consequence of South African control restrictions which affected all our major competitors. Our trade was held better than that of the majority 1456 of our major competitors. As regards the second part of the Question, we have done our utmost to bring Rhodesia back to constitutional rule. We do not accept the Smith régime as a de facto Government.
§ LORD BARNBYMy Lords, is the noble Lord aware that exports to South Africa have actually fallen by 18 per cent.? These exports are composed largely of heavy equipment, and South Africa is our largest market in the world in those articles. Is the noble Lord further aware that sentiment may have quite an effect? Shipments of gold from South Africa to the United Kingdom, which are down by more than 50 per cent. in the first six months of this year as against last year, may be affected very much by adverse thinking, though he may well say—
§ SEVERAL NOBLE LORDS: Question!
§ LORD BARNBYPerhaps the noble Lord will confirm that South Africa is building up her own reserves, but the total—
§ SEVERAL NOBLE LORDS: Speech!
§ LORD BARNBYPerhaps the noble Lord can confirm that the total shipments are over 50 per cent. down.
§ LORD BESWICKMy Lords, if the noble Lord is saying to the House that we are incurring unpopularity in certain parts of the world because we are doing what is right in Rhodesia, then I hope that he and his friends are prepared to incur this unpopularity. As for confirming the 50 per cent. drop in our trade, according to the trade figures we have in fact, as I said, fallen by £2.3 million over the corresponding period in the previous year; and while our exports went down by 8 per cent., the exports of France went down by 10.6 percent., those of West Germany by 22.9 per cent., and of Japan by 20.8 per cent.
§ LORD ROWLEYMy Lords, can we be assured by my noble friend that Her Majesty's Government will not be deflected merely by economic or financial considerations from seeking a solution to the problem of Rhodesia on proper grounds?
§ LORD BESWICKMy Lords, I am sure that that is the attitude which the 1457 majority of Members on both sides of the House would adopt.
§ LORD OGMOREMy Lords, may I ask, as a matter of constitutional principle, if this Government do not recognise the Smith régime as a de facto Government. with whom Mr. Watson and Mr. Wright have been talking?
§ LORD BESWICKMy Lords, the permanent officials of the Civil Service of this country have been talking with permanent officials of the Civil Service of Rhodesia.
§ LORD OGMOREAnd by what Government, my Lords, are the civil servants of Rhodesia employed?
§ LORD BESWICKMy Lords, they are members of the governmental machine in Rhodesia.
§ LORD GRIMSTON OF WESTBURYMy Lords, are Her Majesty's Government aware that it is estimated that something approaching £300 million worth of exports to the Union of South Africa have already been lost by direct Government action in banning the export of aircraft, ships and electronic equipment, and that to a country with which we are maintaining a defence agreement? Is it still to be the policy of the Government to exacerbate the present balance-of-payments crisis by this action, while at the same time they are asking sacrifices of the country to increase exports?
§ LORD BESWICKMy Lords, I would have thought that, whatever economic policy we pursue, we should have in mind some larger social objectives, and I cannot see that we should allow monetary considerations to govern completely our foreign policy.
LORD GRIMSTON or WESTBURYMy Lords, I would remind the noble Lord that this Government are maintaining a defence agreement with the Union of South Africa, so these high moral considerations really sound rather hypo-critical.
§ LORD REAYMy Lords, might not Her Majesty's Government conclude that it could be in the British long-term interest to reduce the degree of our commercial dependence on South Africa, in case the day might arise when the Government of this country could no longer 1458 resist international political pressure to apply sanctions against South Africa, and to this end would they consider withdrawing their export promotion council from South Africa now?
§ LORD BESWICKMy Lords, perhaps in replying to the noble Lord, Lord Reay, I might add something to what I have just said to the noble Lord, Lord Grimston of Westbury. I did not use the word "moral" in this context; I think it is difficult to use the word "moral" in some of these matters. I would say to the noble Lord, Lord Reay, that if we did apply high moral considerations when deciding with whom we should trade the possibility would be that we should find ourselves on an island doing trade with no one.
§ LORD MERRIVALEMy Lords, when the noble Lord says there has been a welcome slight increase in our exports to Portugal, does he mean Portugal herself or Angola and Mozambique?
§ LORD BESWICKMy Lords, I was quoting from the Board of Trade statistics.
§ LORD MERRIVALEMy Lords, there is a difference.
§ LORD BESWICKPortugal.
§ LORD SEGALMy Lords, can Her Majesty's Government tell us what their attitude is towards the resumption of trade relations between Zambia and Rhodesia?
§ LORD BESWICKMy Lords, I am afraid I do not follow the course of my noble friend's reasoning.
THE DUKE OF ATHOLLMy Lords, could the noble Lord tell us the percentage of the increase in exports to Portugal compared with what I imagine is an increase in exports to the other EFTA countries during the same period?
§ LORD BESWICKMy Lords, I should be delighted to give the noble Duke the references in the Board of Trade statistics if he will give me notice of the question.
§ LORD BARNBYMy Lords, arising out of the noble Lord's first reply, is it to be understood that his view is that should there be a change in the movement of gold from London to other places and 1459 that it would have no adverse effect on sterling? Secondly, can he confirm that the balance of trade between South Africa and this country for the current six months as against the last six months has deteriorated from 70 million rands to 10 million rands?
§ LORD BESWICKMy Lords, what I have said, I have said. I am not expanding on any economic theme. I am saying that I believe we are doing the right thing in Rhodesia and we shall continue to do so. All I would add to the noble Lord, Lord Reay, in answer to whose question I think I was rather less than courteous or forthcoming, is that I accept the fact that we should have regard to the nature of the régime or the Government with which we deal, but I do not think, in all honesty, that we can apply what were referred to as "high moral considerations".
§ LORD MILVERTONMy Lords, arising out of the noble Lord's answer to this question, would Her Majesty's Government not agree, in view of the present trend of negotiations over this matter, that unless a solution is found which is acceptable not only to Her Majesty's Government but to the de facto Government of Rhodesia, the results will be the destruction of the Rhodesian economy? Would Her Majesty's Government not agree that the great train of consequences arising from such a destruction would involve also the High Commission Territories of Bechuanaland, Basutoland and Swaziland, whose hope of a happy future would be endangered by those circumstances if they eventuate?
§ LORD BESWICKMy Lords, the noble Lord has made some very weighty remarks. I hope they are taken fully into account by Mr. Smith and his minority régime.
§ LORD MacPHERSON OF DRUMOCHTERMy Lords, is the noble Lord aware of the loss of invisible earnings from South Africa, in particular on insurance?
§ LORD BESWICKMy Lords, I am aware of all these factors. I am sure that noble Lords on both sides of the House are aware of them. I still think that in these matters we should do what we believe to be right.