HL Deb 25 July 1979 vol 401 cc1923-4

2.46 p.m.

Lord ORR-EWING

My 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 how much the Comecon countries currently owe to (a) the United Kingdom and (b) the OECD countries in respect of trade loans and whether they are satisfied that the repayments are in accordance with the repayment schedule.

Lord TREFGARNE

My Lords, there are no published details of Comecon countries' trade loans or of total indebtedness to the United Kingdom or the OECD countries. At the end of 1978 the Bank of International Settlement reported Comecon liabilities to Western commercial banks totalling about 50 billion dollars, of which about a quarter is owed to banks in the United Kingdom. The Comecon countries have maintained a sound payments record.

Lord ORR-EWING

My Lords, is it not true that the loan of £900 million made by Mr. Wilson in 1974 was made on quite exceptionally advantageous terms—terms which our own industrialists cannot now receive? Is it not also true that the United Kingdom has to accept in exchange goods which handicap our industrialists and distort our trading arrangements? Lastly, does it make sense for the Free World to go on lending these huge sums of money to the USSR, supplying goods and also transferring technology, thus unabling the USSR to continue with the biggest rearmament programme the world has ever seen while keeping their own people relatively happy?

Lord TREFGARNE

My Lords, if I may answer the last supplementary first, I think we have to trade in the real world. We certainly keep a close eye on what we export to the Soviet Union so that we do not unwittingly provide them with technology which we would rather they did not have. With regard to my noble friend's point on cheap interest rates, we have certainly vigorously supported international attempts to rationalise credit and interest rates for these countries, but if British industry is to remain competitive we must match the credit terms made available by our competitors.

Lord GORONWY-ROBERTS

My Lords, is the Minister aware that the policy of strictly scrutinising exports with a view to avoiding the export of strategic goods and services, so called, is being observed very stringently by a number of Western powers, and not least by this country? Can we take it that the present Government are as stringent about this as were their predecessors, and that this scrutiny includes not only the so-called Comecon countries but similar countries in other parts of the world?

Lord TREFGARNE

My Lords, we certainly scrutinise applications with the same diligence as the previous Administration, but we do not always apply the same criteria.

Lord ORR-EWING

My Lords, is my noble friend aware that the Brookings Institute has recently said that these very large debts now owed to the Free World will have to be rescheduled, and are Her Majesty's Government giving attention to this matter and taking an initiative, as they have in other spheres?

Lord TREFGARNE

My Lords, we are not aware that there will have to be a rescheduling. As I said before, the Comecon countries have thus far, at least, maintained a sound payments record.

Lord GORONWY-ROBERTS

My Lords, may I ask whether the noble Lord is aware that that part of his answer referring to his Government not applying strictly the same criteria as their predecessors is a somewhat cryptic statement? Can I take it that the variation to the criteria applied is not a variation of the strategic considerations borne in mind by the Government as a whole?

Lord TREFGARNE

My Lords, yes, you can.