Japan: UK Trade Opportunities (Hansard, 10 May 1988)

§ Lord Young of Graffham
My Lords, the appreciation of the yen and efforts by the Japanese authorities to boost imports have greatly improved the prospects for exports to Japan. British exports rose 26 per cent. in sterling value in 1987, and given the right approach on the part of British companies I believe that they could be doubled over the next three years. The Opportunity Japan Campaign will be conveying this message to British industry at a series of briefings throughout the country this summer.

The Viscount of Oxfuird
My Lords, I thank my noble friend for his reply. Will he elucidate further on the Opportunity Japan Campaign?

§ Lord Young of Graffham
My Lords, I suspect that the barriers to sales to Japan are more apparent than real. Many people in industry and commerce believe that Japan is a difficult market but do not appreciate the potential that it now has. Japan now has the highest per capita GDP of any country in the world and there exist tremendous opportunities, especially for luxury goods. My right honourable friends the Secretary of State for Energy and the Foreign Secretary and myself are speaking at a series of meetings around the country, some 20 in all, at which we shall be approaching many people from industry and commerce and directing their attention towards the opportunities that we believe Japan now presents to the United Kingdom.

§ Lord Taylor of Gryfe
My Lords, does the Secretary of State agree that many sectors of British industry are aware of the opportunities for export to Japan? Will he agree that they are limited by some of the constraints that are placed by the Japanese authorities, particularly in the financial sector, and also the excessive tariffs on items such as Scotch whisky?

§ Lord Young of Graffham
My Lords, so far as Scotch whisky is concerned I have reason to believe that the barriers or tariffs which have existed for some 20 years will be disappearing during the course of this summer. I believe we shall find that the Japanese authorities will be responding to the GATT panel and that the discriminatory taxes against Scotch whisky will be disappearing, even though there may be some difference in taxes between locally produced drinks and Scotch whisky.
On my recent mission to Scotland I took with me the chairman of Guinness, which is now opening its own distribution company in—

Noble Lords
Japan!

§ Lord Young of Graffham
In Japan. I have great hopes of prompting the sales effort. Unfortunately, I was not able to visit Scotland.

§ Lord Taylor of Gryfe
My Lords, will the Minister reply to the first point on the financial sector?

§ Lord Young of Graffham
Of course, my Lords. Only a few months ago the Japanese authorities admitted four more British companies to the Japanese Stock Exchange. I believe we are now seeing the opportunities available in Japan and that we shall see the barriers disappear as well.

§ Lord Jenkin of Roding
My Lords, does my noble friend accept that there is a wide need to improve the standard of Japanese speaking by British businessmen? Has he seen the very generous donation which has been given by one of our leading clearing banks towards increasing the facilities for Japanese teaching in this country for businessmen? Will he undertake to match that donation so as to double the amount made available for this purpose?

§ Lord Young of Graffham
My Lords, I gladly pay great tribute to my noble friend's activities as chairman of the group which has been promoting trade with Japan so strongly over the last year or two. I pay further tribute to his perseverance in asking me yet again about a matter that we discussed not very long ago. I told my noble friend then that I should be happy to consider that matter in some detail very shortly. I was not happy, nor should any Member of your Lordships' House be happy, with the knowledge that the universities only produce some 50 graduates in Japanese a year. That does not seem to be a very satisfactory number. I have since been made aware of a number of polytechnics and further education institutions around the country which are training people in the Japanese language, but what we need as a matter of urgency is to have more of our businessmen fluent in Japanese.

§ Lord Molloy
My Lords, in view of the fact that both British and American businessmen have had to request both governments to make representations to Japan to remove some of the very unfair and unjust restrictions—some still exist—will he say whether both the British and American Governments will continue making representations when unfairness is still applied to British and American goods being exported to Japan?

§ Lord Young of Graffham
My Lords, I am unable to speak for the American Government, but representatives of the British Government have been to Japan. My right honourable and learned friend the Foreign Secretary was there in January. I was there in March. We are making considerable progress and I believe that those businessmen who came with me on my last mission are well aware that the barriers are fast disappearing.

§ Lord Bruce-Gardyne
My Lords, can my noble friend shed any light on what is happening regarding the clearance of Nomura to operate as a gilt-edged market-maker in London?

§ Lord Young of Graffham
My Lords, if my noble friend would care to put down a Question on that I should be happy to answer it.

§ Lord Williams of Elvel
My Lords, will the Secretary of State agree, as all the evidence suggests, that one of the most important opportunities for increasing our trade with Japan is for British companies to be able to acquire Japanese companies? Will the noble Lord recognise that it is infinitely more difficult for British companies to acquire Japanese companies than it is for Japanese companies to acquire British companies? Should not the principle of reciprocity be agreed with Japan in the same way as for other countries, for example Switzerland?

§ Lord Young of Graffham
My Lords, I congratulate the noble Lord on his ingenuity in somehow travelling all the way from Japan to Switzerland without stopping. As this Question is on Japan, I should say that one of the members of my last delegation, who had tried for some time to set up a joint venture in Japan, decided during the course of my mission that he would set up his own green field site factory and is so doing. I am sure there are opportunities, but they cannot be made by governments; they are normally made by business people.

§ Lord Williams of Elvel
My Lords, I am sorry to press the noble Lord. Does he recognise that the Opposition are not asking for the Private Notice Question in another place on Rowntree plc to be repeated in this House in order to help the Government make progress on the Education Reform Bill? Will the noble Lord therefore take the opportunity of making clear the Government's view on reciprocity generally, and particularly in the case of Japan?

§ Lord Young of Graffham
No, my Lords.

§ Lord Rugby
My Lords, to what degree are the Japanese pushing the language of Esperanto by way of a business medium for communication? Is the noble Lord aware that Esperanto is very much easier to learn than Japanese for an Englishman and easier to learn than English for a Japanese?

§ Lord Young of Graffham
My Lord, among the many attributes I have, speaking languages does not figure. Esperanto is as difficult for me as Japanese, and I am afraid that is a different question.

Lord Morris
My Lords, in answer to a previous supplementary question my noble friend stated that our trade over the last three years with Japan had increased by 26 per cent. What is that figure in real terms?

§ Lord Young of Graffham
My Lords, trade last year increased by 26 per cent., not in the last three years. I believe that our trade with Japan last year was some £1.5 billion.

§ Lord Cledwyn of Penrhos
My Lords, the noble Lord was very abrupt and unnecessarily curt when 971 my noble friend asked the question about reciprocity. The fact is that it was decided not to take the Private Notice Question here in order to advance the debate on the Education Reform Bill. Will he be good enough to be courteous and reply to my noble friend?

§ Lord Young of Graffham
My Lords, I wish to assure the noble Lord the Leader of the Opposition that I intended no discourtesy. However, I believe that the noble Lord, Lord Williams of Elvel, knows of my position. I must wait to hear from the Director General of the Office of Fair Trading. In due course I must decide whether to remit the matter to the Monopolies and Mergers Commission. I must then wait until I hear from the commission. That means that I am inhibited to a great extent in, if not prohibited from, commenting on the position. Anything I might say about our merger policy and reciprocity which was more than was said in the working paper issued some six or seven weeks ago would be read by those outside as a comment on the present position. I find myself in a most difficult position; I intended no discourtesy to the noble Lord.