South Africa: UK Investment (Hansard, 20 November 1985)

Baroness Sharpies
My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

§ The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth)
My Lords, the most recent official figures show that the book value of United Kingdom investment in South Africa at the end of 1981 was £2,826 million.

Baroness Sharpies
My Lords, I thank my noble friend for that reply. Does he agree that perhaps investment should be increased enormously because there are 21 million coloured and black people in South Africa, and also there is the problem now arising with unemployed people in the white community?

§ Lord Lucas of Chilworth
My Lords, in general terms I think that we would probably agree with my noble friend, but certainly decisions on overseas investments are best left to the commercial judgment of the companies concerned, and that investment in South Africa is making a contribution to the economy of that country.

The Lord Bishop of Manchester
My Lords, will the noble Lord agree that most responsible leaders of nationalist black opinion in South Africa are against this continued level of investment from western countries which they believe is perpetuating an unjust and oppressive regime?

§ Lord Lucas of Chilworth
My Lords, the Government have on a number of occasions made quite clear their abhorrence of the regime in force in South Africa. But we do not believe that the withdrawal of our investment or of our economic activity, which employs so many of the population of South Africa, is the best way to ensure change.

Lord Paget of Northampton
My Lords, will the noble Lord agree that investment in South Africa has proved a good investment? It has increased the wealth both of the borrower and the lender. However, investment in the rest of Africa has, on average, proved the opposite largely because of the amount that gets stolen. On the whole, loans to the advancing countries in South Africa are money which is lost and does no good to anyone. In the circumstances that we benefit Africa as well as oursleves, will the noble Lord encourage investment in a good and reliable source?

§ Lord Lucas of Chilworth
My Lords, since my noble friend's Question addresses the position in South Africa, I would prefer not to be drawn on the rest of Africa. There is no doubt in the Government's mind that sound investment in South Africa is one of the best ways of ensuring and aiding change in the direction to which I think we would all wish that regime to go.

Lord Paget of Northampton
My Lords, that is surely a by-product.

§ Lord Monson
My Lords, does the noble Lord agree that most British and international firms are a positive force for good in South Africa? I say this because if you want to see black men and women in responsible, well-paid white collar jobs, you are likely to find them, above all, in branches of Barclays Bank, Standard Chartered Bank, British insurance companies and international hotel chains.

§ Lord Lucas of Chilworth
My Lords, in general terms of course I would agree with the noble Lord, Lord Monson.

§ Lord Sainsbury
My Lords, may I ask the Minister whether it is not a fact that many wise British companies have already withdrawn their investments in South Africa?

§ Lord Lucas of Chilworth
My Lords, the fact that some companies may have withdrawn their investments is a commercial decision for them. I do not believe that it bears at all upon the underlying reference in the noble Lord's question.

Lord Morris
My Lords, my noble friend quoted the book value of investments in South Africa. Can my noble friend possibly tell the House what is the real value of those investments?

§ Lord Lucas of Chilworth
No, my Lords, I cannot. Since there have been exchange rate changes in recent weeks, I have not made the calculation. It would be dangerous for me to give a view on valuations by commercial companies of their assets. I do not think they would thank me and nor do I think my noble friend would do so.

§ Lord Avebury
My Lords, does not the Minister think that the majority of people in South Africa are entitled to have a say in what is the best means of ensuring change in that country? Since their representatives are unanimous in believing that disinvestment is the correct answer, why are the Government deaf to their entreaties?

§ Lord Lucas of Chilworth
My Lords, I do not believe that what the noble Lord has said is in fact correct; nor is it indeed true. Again, it is for the individual companies to make their investment decisions. We believe that investing in South Africa, and the benefits that accrue to South Africans of all races by virtue of that investment, is the best way of helping to make the change which both the people in South Africa and ourselves would wish to see.

Lord Bruce of Donington
My Lords, will the noble Lord agree that the term "British investment", which was in the Question put down by the noble Baroness, can be misleading? Will the noble Lord also agree that it might be thought that this is an investment made by the will of the whole British people? Will he make it abundantly clear that the bulk of the people of the United Kingdom do not approve of investment of this kind, and that the investment decisions are made by individuals and firms?

§ Lord Lucas of Chilworth
My Lords, the noble Lord, Lord Bruce of Donington, is trying to mislead either me or your Lordships' House. The investment is a result of the decisions of individual companies. It represents their commercial decision. It is not a matter in which the British Government can or will issue directions.

§ Lord Hatch of Lusby
My Lords, if the noble Lord and the Government are sincere in their belief that British investment is assisting the move away from apartheid and towards democracy in South Africa, how does it come about that after 85 years of British 552 investment the plight of the African and coloured populations in political and human rights terms is much worse than it was at the beginning?

§ Lord Lucas of Chilworth
My Lords, it would be quite wrong for us to encourage the removal of British investment in South Africa. That investment is the largest foreign investment in South Africa. It has made a contribution and continues to make a contribution to the wellbeing of that country. Were that investment to be removed there would be, I suggest, something approaching economic chaos in that country, in which then no progress along the direction which the noble Lord seeks could ever possibly be made.