Latin America

HL Deb 19 December 1990 vol 524 cc832-69

3.10 p.m.

Viscount Montgomery of Alamein rose to call attention to the situation in Latin America; and to move for Papers.

The noble Viscount said: My Lords, it is now exactly 19 years less one month since we last had a debate on Latin America. That was in response to a Motion put down by the late Lord Cowley. The debate lasted three hours and 40 minutes and there were 14 speakers. Today we have 16 speakers who are allocated two and a half hours. That shows a considerable increase in productivity in your Lordships' House.

Unfortunately, despite some efforts on my part, there are no speakers today who spoke in the last debate. One noble Lord I encouraged to speak said that so much time had elapsed since my Motion first appeared on the Order Paper that what he intended to say had been overtaken by events. However, we have today a wide range of speakers who will cover a variety of aspects of this immense subject, which is of enormous interest.

I am very glad that we shall hear a maiden speech from my noble friend Lord Aldenham whose family is a fine example of British mercantile involvement with Latin America dating from the beginning of the last century.

I have spoken on this subject in the House many times. The last occasion was the foreign affairs debate on 13th November. Today I want to tackle different aspects of the problem. However, it would be right to start by giving some background.

We are discussing an immense continent comprising nearly 450 million people. Half of the population lives in two countries—Brazil and Mexico. Brazil is larger than continental USA and Argentina is the size of India, with only 5 per cent. of the population of that country. Latin America stretches from the US frontier to the edge of Antarctica. It contains some spectacular scenery and notable mountain ranges and its minerals, agriculture and human resources are of almost unquantifiable proportions. Two thirds of the world's surviving rain forest is in the Amazon basin, which is larger than Western Europe. The Amazon river contains 20 per cent. of all riverine fresh water in the world. Those are shattering statistics.

The rain forest is a matter of worldwide concern. It is very exciting that today the Latin Americans themselves are addressing the problem with great vigour. I am sure that we shall hear more on the subject from my noble friend Lord Chorley and the noble Lord, Lord Shackleton, who are both former presidents of the Royal Geographical Society. It is worth mentioning that the Royal Geographical Society has played an important part in developing that relationship and stimulating interest in the rain forest among Latin Americans, as have other British institutions, such as the Royal Botanic Gardens.

As I said, it is a continent of vast and extraordinary potential. Sadly, in the course of this century we have seen a decline in British interest in Latin America. Exports to Latin America from the UK amount to only 2 per cent. of our total exports. Our share of the market is now less than 2 per cent. Two-way trade between Latin America and the UK, at just over £2 billion, is less than our two-way trade with Denmark. That is extraordinary when one considers, in terms of developing countries, that it is a continent of highly entrepreneurial people. Stock markets have been in existence for many years, in some countries since the middle of the last century.

I like to think that a new-found confidence will result from the re-establishment of democracy. In many countries in Latin America there are now new young politicians who are making structural changes to their economies. They are leaving behind the rhetoric of nationalism, which is in decline, and considering the advent of new, open markets. They are vigorously attacking inflation. With more stable currencies we hope to see a new flow of much-needed investment capital.

The point about open markets is that they must be two-way. It is therefore with great sadness that we have seen the recent failure to reach full agreement in the GATT talks. There is a European dimension to the issue. The situation is not quite as apocalyptic as the press would have us believe, but it is a serious impediment. Agriculture is vital to the recovery of many Latin American countries and the diversification of their markets should not be impeded by protectionist tariff barriers in Europe and the USA. Most Latin American statesmen recognise the social problems which face European agricultural producers, but surely individual governments in Europe must solve the problem by other means than subsidising the price of agricultural produce. It happens that in this instance the UK and Latin America have much in common. The United Kingdom can be seen as an ally in Europe and as a gateway and bridge into the Community for Latin America.

This is a vast subject and we have limited time. But it would be wrong for me to leave the subject of Latin America without mentioning the work of Canning House, more formally known as the Hispanic and Luso Brazilian Council. This is a charitable institution which I have supported for many years in different capacities. It acts as the focal point for promoting knowledge of Latin American and the Iberian peninsula in this country. A very small and dedicated professional staff carries out an immensely important programme. Among other things the council has recently introduced an annual morning seminar for parliamentarians, focusing on current issues. The seminars will continue and I hope that we shall see new faces each year from both Houses at those events.

There is also the matter of language. Spanish is now the most internationally spoken language in the world after English. However, for some reason it is still relegated to an extra in the national curriculum. I do not know whether people appreciate that more than 10 per cent. of the population of the United States speak Spanish as their first language. It is a shattering thought that before the end of this decade there will be more people in the United States who speak Spanish than there are in Spain.

Canning House also focuses on the European dimension, since we believe that the decade of the 'nineties will see a major development in European-Latin American relations in which the United Kingdom has an important role to play. In that context I have two suggestions to make to Her Majesty's Government who, I believe, have a most important part to play in assisting the development of that new relationship.

There is a good deal of enthusiasm for Latin America among the small number of middle and senior management in UK companies involved in the region. However, a problem has existed for some time in focusing the attention of chairmen and chief executives, unless those companies are large or well-established in the area. New entrants into the market are quite rare. That may be because there is such pressure in the London market to achieve short-term results. I believe that Her Majesty's Government could give a lead in that connection.

Nearly 20 years ago, in 1972, a major conference took place at Lancaster House which followed a visit by a Cabinet Minister to Latin America. I suggest that that should be repeated in the middle of 1992, giving a lead time of about 17 months. Apart from being the year of the completion of the single European market, 1992 is the 500th anniversary of the encounter between the New World and the Old World dating from the voyage Cristóbal Colon across the Atlantic. It was an important encounter between two civilisations. A major conference organised by Her Majesty's Government in 1992 would seem appropriate.

My final suggestion concerns visits. During the 1960s and 1970s before which time Latin America was largely undemocratic, there were an enormous number of visits by royalty. But since the return to democracy these have become very rare. Although there are fairly frequent visits by Ministers of State and junior Ministers, Cabinet Ministers seldom travel to Latin America and no Prime Minister has ever been there. Meanwhile the King of Spain is in action a lot of the time and has visited almost every country in Latin America since the restoration of democracy. President Bush has just completed an important whistle stop tour at what must have been an extremely difficult time for him. I like to think that that may signal the start of a new initiative in Latin America by the United States since there has been no such thing since President Kennedy and the Alliance for Progress nearly 30 years ago. However, we should now do something from the United Kingdom.

In articles and speeches in various forums I have suggested frequently that the former Prime Minister should visit Latin America, but I fear that her heart was not in the project. We now have a new Prime Minister and a new opportunity to develop the special relationship. I believe that nothing could make more of an impact, and nothing could be more original or welcome, both in Latin America and in British industry and commerce, than for the new Prime Minister to visit Latin America, make an extensive tour and treat those countries seriously with a view to building a new relationship between Britain and Latin America. I hope that this will happen.

My Lords, I beg to move for Papers.

3.22 p.m.

Lord Shackleton

My Lords, I should like to congratulate the noble Viscount, Lord Montgomery. The whole House knows his total and devoted interest in South America. As president of Canning House for many years and having been involved with many other such institutions, there is no one better qualified to speak to your Lordships. Once again I find myself speaking first on that aspect, when I intended to make only a brief intervention on the Anglo-Argentine fisheries agreement. However, I must attempt to follow up some of the important points made by the noble Viscount.

I had been a Minister for one week when I was first sent to South America. I flew out to the inauguration of President Frei. That was a time of great hope in Chile before the disaster following the Allende presidency and the takeover of Pinochet. We hope to see Chile return fully to democracy now. I landed at Rio. I saw a lot of soldiers on the airfield and wondered what they were doing there. I thought that perhaps there was a review taking place. Suddenly the British Ambassador appeared and asked me, "Minister, are you ready to inspect the guard of honour?" I sat there in slacks and shirt. However, the very first guard of honour that I inspected as a Minister was from the Brazilian air force. I have a very soft feeling for the kindness that I received on that occasion.

Now is a time that we need to concentrate our interests much more strongly in South America. I shall not waste time speaking of the sad tragedies, the disasters and the awful affairs that took place in South American countries. I shall look at the more hopeful side. Now is a time of hope and of increasing economic liberalism. There is a movement towards democracy, although there are many areas in which there are shortcomings. No doubt noble Lords will speak on that situation.

I should like to refer to the development of economic liberalism which was described by the Venezuelan Foreign Minister, Reinaldo Figueredo Planchart, when he was at Chatham House in July. I am sure that the noble Viscount is well aware of that. That brings me to a country in which I declare an interest as an investor and a businessman; namely, Venezuela.

I regard Venezuela as a good example in South America of a country which becomes more and more understandable to the British. It is a working democracy and has been so for 30 years. There is much that one could say on the positive side in Venezuela, as indeed in other South American countries. Venezuela—it is notable with the ambassador here—is taking a lead on the environment. The environment comes up frequently. It is not just confined to a few European countries. Venezuela has introduced all kinds of regulations to strengthen environmental considerations. It has banned mining and cutting down forests in certain areas. Venezuela has taken a deep interest in the problems of the atmosphere and cutting down forests. It has set up a number of institutions. As in Brazil, I want to see further co-operation.

The noble Viscount, Lord Montgomery, referred to the excellent co-operation on forestry that has taken place in Brazil. He mentioned particularly the work of the Royal Geographical Society. I shall not go into the details but leave that matter to the noble Lord, Lord Chorley, who is the immediate past president of that society. That is a most encouraging development. In a recent report mentioned today in The Times, a House of Commons Select Committee paid tribute to the president of Brazil in regard to the initiative that he shows about conservation in Brazilian forests where, as in Venezuela, there is great progress and great scientific interest.

As I said, I had intended to speak primarily about the Anglo-Argentine fisheries agreement. Noble Lords will be aware that I am very firm in my conviction that the Falkland Islands are British. But I welcome that agreement as an admirable example of co-operation and political wisdom on the Argentinian side. I should like to pay tribute to the Argentine negotiators for being responsible for a sensible and imaginative agreement. There is no time to describe it but the Falklands would obviously have liked to claim the 200 mile limit. The original security zone was set at 150 miles. There is a large area which is not protected by licence and where the fishing, of squid in particular, has almost drained that part of the ocean of biological resources.

There is now to be a joint commission to administer that area. It involves Argentina recognising the Falklands' interest and the Falklands recognising the Argentine interest. There is no suggestion that there is any danger to the Falklands' nationality. Both sides reserve their position. It is an agreement modelled, if I may say so, somewhat on the Antarctic Treaty. That is an example of which we ought to take note and express great satisfaction about. As a committed Falkland Islander I welcome it and hope that the Falklands will recognise that this is a step which will improve fishing and conservation and also contribute to Anglo-Argentine friendship.

3.29 p.m.

Lord Greenhill of Harrow

My Lords, I have long admired the noble Viscount's persistent campaign to make us realise the changes which are now taking place in Latin America. He is fully justified in his efforts. He is especially qualified to speak and by his personal efforts has certainly contributed to the renewal of more normal links with the Argentine, although the basic problem of the Falklands remains and could one day present difficult dilemmas.

I am glad that the noble Lord, Lord Shackleton, referred to the fishing agreement which has been reached. It is a very skilful agreement and one which diminishes the chances of such troubles arising. I am also very glad that the noble Lord, Lord Shackleton, referred to the activities of the Venezuelan ambassador in this country. Both he and his wife are graduates of both Oxford and Cambridge. He sets a good example in showing how we can make progress in our relations with Latin America.

I find myself very much in agreement with what the noble Viscount, Lord Montgomery, says: I shall not need eight minutes to add to it. I sometimes find it hard to forget what I was once told by a former governor of the Bank of England. Although he is not in the House, I am glad that he is still with us. He stated some time ago that the British have lost more money in South America than they have ever made. Even if that were still true, I believe that it will not be valid by the end of the century provided we take advantage of the changes now taking place.

We have neglected opportunities in the past. However, our large investments were one of the financial casualties of World War Two. For a long time we were unable even to try to rebuild. Consequently, the continent fell very low in our international priority list. Very few of us remember immediately that Brazil joined the Allied Forces in World War Two. I remember standing in Naples harbour watching the Brazilian contingent disembark—I believe that that was in 1944. However, I can speak now only from my experience in the Foreign Office since 1946. For many years we had very few real specialists on Latin America in the office. If there were economies to be made in official establishments, as there always were, it was inevitably within the Latin American continent that they fell.

Curiously enough, in the days of Mr. Bevin an extravagant and elaborate new embassy was built in Rio, just in time to become a white elephant when the Brazilian capital moved hundreds of miles away to Brasilia. I do not think that the Treasury has ever forgotten that, especially as the building had to be sold at a low price. It now graces Rio as one of the finest buildings in the city.

However, generally speaking, it was always difficult to interest Ministers in South America. The late Lord Stewart of Fulham sensible as always, was, I believe, the first British Foreign Secretary to visit the continent on a comprehensive tour in 1966. As one would expect, at the time of the Falklands War the British embassy in Argentina was undermanned although the Franks Inquiry found that there had been little fault in its reporting.

I mention this past history only to ask the Minister to give an assurance that there is now a new attitude in the Foreign Office towards the Latin American continent; and that our staffs are adequate for both political and commercial purposes. There is now a Spanish-speaking Minister of State in the office and I expect him to give a new impetus in both areas.

The British Council, Canning House, to which the noble Viscount has referred, the British Overseas Trade Board and the BBC Overseas Service have important roles to play in supporting a new British effort in the continent. But it is up to British companies to take initiatives to expand their businesses. As the noble Viscount has pointed out, profound changes are taking place. He spoke of significant moves towards democratic government, although Central America still lags well behind. I expect the right reverend Prelate the Bishop of Manchester to refer to that later in the debate.

As important as the growth of democratic government is the advancement of high technology industries in competition with the industrial activities of Europe and America. There is also a changing pattern of population—a large influx of Europeans and Japanese. It was news to me to be told that the largest Swedish city outside Scandinavia is in Latin America. The links with Europe, always strong, are becoming stronger. With the support of Spain and Portugal within the European Community, it is not surprising to learn that there is talk of trying to create a free trade area with the Community.

Similarly, President Bush has advocated a free trade area between Latin America and the United States; and a trade agreement with Mexico and the United States on the lines of the US/Canada trade treaty has been secured.

Another factor to be noted—one to which the noble Viscount, Lord Montgomery, referred—is the use of the Spanish language not only in the United States but world wide. Noble Lords will find, as I did comparatively recently, that many young people from the Caribbean area are learning the language and seeking opportunities to study in Venezuela and other Spanish-speaking countries. There were once significant British populations in a number of those countries. They formed an important commercial link with the UK.

One could go on pointing to important changes and developments. The lesson for us is to learn about them and to keep up to date with them. We need as many overseas markets as we can achieve. The Latin American continent could well be an important element in our future prosperity.

I greatly look forward to the maiden speech of the noble Lord, Lord Aldenham. I am sure that he will do justice to the importance of the debate.

3.37 p.m.

Lord Aldenham

My Lords, I should like to thank the noble Viscount, the Lord Montgomery, for his kind introduction and for asking me to speak in the debate. I have a personal interest. I was born in Santiago in Chile. In the past few months, I have learnt that my parents seriously thought of settling down there.

I shall confine my remarks to Chile—or to the west coast of the continent. I am proud to have Chilean nationality as well as British. Indeed, I nearly did my national service in that country but chose to go to university instead. However, I spent nine months in Chile when I was 18 and I saw a great deal of that country and its people.

Although I am not, and have never been, in business with South America, my family have been involved throughout the continent's independent history. My ancestor, Antony Gibbs, who founded the London house of Antony Gibbs and Sons, opened his first office in Lima two months after the declaration of independence. It first traded in Peruvian guano and later switched to Chilean nitrate. As a farmer, I am aware how important those new sources of fertiliser were in helping to raise agricultural yields in that country as the demands of expanding industrial cities rose. The exploitation and sale of these untapped resources brought much needed revenues to the Peruvian and Chilean governments. The profits helped the partners of Antony Gibbs to invest in Brunel and his Great Western Railway, to become model Victorian landlords, and to indulge their high church religions by restoring and building churches in Britain.

Chile, and its nitrate, became the focus of Antony Gibbs' trade. It leads me to one of Chile's most serious problems. It has been a one-product economy, first based on nitrate and then on copper. When artificial nitrate first appeared in the late 1920s, the economy slumped. In the same way, until recently, world copper prices have dominated the country's finances.

Most school children used to be able to recognise Chile on the map. It is the long thin country on the west coast of South America. The range of climate is extraordinary. There is barren desert in the north, but rich in nitrate, copper and other minerals, and with a sea rich in fish. There is a steadily increasing rainfall as one travels south, with odd variations caused by the north-south mountain ranges. As a result a great variety of foodstuffs can be grown ranging from the staples of wheat and maize; and beef, chicken and of course wine; to all kinds of fruit and great stretches of forestry. Chile's exports of fruit, vegetables wine, timber and timber products are growing fast. The tourist industry has great potential. There are fine sea beaches north of Valparaiso (although the sea is always cooled by an Antarctic current), skiing, fishing, marvellous countryside, excellent wine from pre-phylloxera vines, good food and a very exceptional, friendly welcome.

I had the good fortune to travel this lovely country from north to south, from Arica to Punta Arenas. I made the journey with agents of the family company. They took me round their districts where they bought and sold and bartered if necessary. They were not unlike the old pack pedlars, although they travelled in ancient pickup trucks. Business was a long affair of news and gossip ending with a glass or two of home-brew to seal the bargain. In this way I was able to see a way of life that probably had to vanish. It is a country of small-holdings eking out a living and large ranches which were not much more profitable. As I said, it was a poor country with one great source of foreign earnings—that is, copper—and therefore at the mercy of world prices. Lack of secure revenue led to a range of social problems which were so difficult to cure that they tended to be neglected by a series of traditionalist middle-class governments.

I too was in Chile at the time of the Frei Government, at a time of great hope. However, I come now to the tricky part in Chile's recent history. In 1970 Senor Allende became the West's first democratically-elected Marxist president with 40 per cent. of the vote. By 1973, he was dead. During his short period in office he tried to push through many reforms which he hoped would prove irreversible. In the long term they might have worked but in the short term they caused enormous disruption and total panic among the middle classes; the people who had been in management positions many of whom fled the country.

I do not believe that anyone can seek to justify methods and the excesses of the ensuing military government. Hundreds of bright, young and not-so-young people whom the country could ill-afford to lose also fled if they could. I was in Australia at the time and I met some of them there. I still recall the horror that I felt at the news of the coup. To me Chile was a bastion of democracy in the continent and the Chilean army was non-politicised. I could not believe that the stories were true. When further reports appeared about what was happening to Allende's supporters I thought that they had to be made up or at least exaggerated. Such things do not happen in Chile. To hear my semi-adopted country held up as one more model of totalitarianism, and pilloried for it, was more than painful. I felt like disowning it.

But after the first plebiscite in 1980 backed the Junta with 75 per cent. of the vote, the economy appeared to be on the mend. Now, in 1990, we have a new democratic government again. It is circumscribed, it is true, by several parting shots from General Pinochet. It has some terrible social and welfare problems as a legacy of 16 years when these were unheeded. The fact that Chile relies on imported oil for some 50 per cent. of its power requirements meant that inflation leapt from about 24 per cent. per annum to nearly 30 per cent. after the Gulf crisis began in August. But that level of inflation, itself partly caused by the outgoing government, is far lower than that of most of its neighbours which might be happy with that rate per month. Chile's trading base is now much wider, with copper representing only about half exports and new items of produce from agriculture, forestry and manufacture making up about one third. Foreign debts, with some external goodwill, appear to be controllable having been much reduced in the past seven years. Above all, the Government coalition, vulnerable though it is, enjoys the goodwill of the people who appreciate its good intentions.

Britain has long had a close relationship with many South American countries, and not least with Chile. Two of Chile's greatest heroes are Cochrane, one of my boyhood heroes, and Miller, his chief lieutenant. English is widely spoken, although one of my guides in the south, who I named Tommy Smith, spoke not a word of English. News of our royal family is as eagerly read there as it is here.

As the noble Viscount, Lord Montgomery, has pointed out, we have been looking for new markets in China and in Eastern Europe. These countries also present financial, practical and sometimes ethical problems to the investor. Chile is an old, well-known and welcoming area for trade and investment. I welcome the news that Her Majesty's Government are actively seeking to cement new relationships in this area. If a search for profitable business can also benefit a country which is seeking to re-establish its democratic roots, I believe that every effort is worth making.

I am most grateful for your Lordships' patience in allowing me to speak about a country of which I am very fond.

3.45 p.m.

Lord Rea

My Lords, it is my pleasure to congratulate the noble Lord, Lord Aldenham, on his maiden speech. I was delighted that he spoke about Chile. I have visited the country and appreciated the detailed and heartfelt description that he gave. It was delivered in a clear, non-controversial style and kept the House interested throughout. I hope that we shall hear more from him in the future.

I had intended to begin my speech by talking about Chile. In 1986 I travelled for two months through Latin America and visited nine countries. I started in Chile and headed north to Mexico. I travelled by bus, train, plane and jeep, staying with friends and in simple hotels. I was helped by Oxfam and the Catholic Institute for International Relations, both well-known non-governmental organisations. Earlier this year I was the guest of the International Planned Parenthood Federation as an observer at the second western hemisphere conference of parliamentarians on population and development. The conference was held in Quito in Ecuador. Subsequently I visited Guayaquil and then Mexico City.

During both journeys I visited health clinics and hospitals in rural villages and cities, including their slum or shanty town districts. I was deeply impressed by the friendliness and hospitality of the ordinary people. I was also impressed by their flair for colour and design, their music, the magnificent scenery, the remains of ancient civilisations and the beauty of the cities and cathedrals that were built by the Spanish in the colonial era. I came away deeply aware of the poverty of the people, particularly those of Indian origin. However, I was impressed by their strength and resilience, particularly of those tough bowler-hatted women. The design of their hats and skirts was based on an Andalucian model. A 17th century Spanish governor decreed that they should wear them because he believed that bare heads and legs were indecent. Those indigenous people have retained their dignity despite more than four centuries of economic and political oppression.

In recent years there has been welcome evidence that real, rather than surface, democracy has begun to emerge. However, the real power remains in the hands of large landlords whose holdings come from the large estates bestowed on immigrants from Spain and Portugal when their governments were encouraging emigration and settlement of the new colonies. Overtly or covertly the military backs the power of that landowning class.

Since the influence of Spain and Portugal receded a century and a half or so ago, the United States has taken on an increasingly dominant role, usually backing the military or landowning classes which have been in a governing position. American investment and finance has also become dominant. United States is the home of the "gringo". I am told that the reason for the word "gringo" is that American marines in various skirmishes in Latin America used to sing, "I'll sing you one-oh, green grow the rushes-oh!". The Spaniards understood the word "gringo" to sound like "green grow the rushes-oh". Because of its power the United States has become grudgingly admired but also fairly universally hated. The economic grip of the industrialised countries—which, though to a lesser extent than it used to, still includes us —has increased further since the debt crisis and the fall in commodity values over the past decade.

The debt burden of Latin American and the Caribbean was, according to the World Bank's tables, 474 billion dollars in 1989 against a GNP of 852 billion dollars. The debt amounts to half the total GNP. That debt has not decreased in recent years. Debt service costs are equivalent to 40 per cent. of export earnings. Obviously some countries are doing better than others and the region as a whole is holding its own better than Africa, but there it still carries a very onerous burden. It is not surprising that the invisible trade in cocaine is thriving, particularly in very poor countries like Bolivia.

Over the years political efforts seriously to challenge the economic dominance of the often very wealthy landowning minority and large foreign—especially North American—concerns have met with overt and covert measures to overthrow, as the noble Lord, Lord Aldenham, mentioned with regard to Chile, more liberal governments and to replace them with governments willing to preserve the status quo. Some of those have been, leaving aside Hitler's Germany, the most cruel and oppressive regimes we have seen this century. Some methods which they have used to gain or hold power have been spectacularly nasty. The United States has been involved in most of those counter-revolutionary activities and coups; for example, those in Guatemala, E1 Salvador, Chile and Nicaragua, to name only the best known. It is not for nothing that the CIA is represented as a skull in an SS style helmet in a well-known mural in the National Assembly in Quito.

The emerging democracies of Latin America are now held in the vice of the debt crisis. The restructuring of their economies, which has been insisted upon by the World Bank and the IMF, has made it virtually impossible to deliver the programmes of health, welfare and education which their populations ask for and need. That is why desperate and destructive guerrilla movements, such as the Sendero Luminoso—the Shining Path—in Peru, have had such an appeal, and why there are slogans everywhere such as the one I saw in Quito: "No paga la deuda externa!"—Don't pay the foreign debt." Democracy has an uphill struggle in the present economic climate and without better health and education the people of Latin America cannot advance and prosper.

As various noble Lords have said, there is a huge potential demand for goods from the industrial world, which includes the United Kingdom, which at present is held back because of the slowing of development caused by the need to service debt. The EC is becoming aware of its economic strength. We should take a leading part in assisting Latin America to "lift off" by offering generous aid for effective social and infrastructure programmes for those countries moving along the road to democracy. We are not so tainted with the suspicion in which Latin America holds the USA. There is a big opportunity waiting. However, simultaneously, we need to go much further down the constructive road to reducing debt, a road along which John Major took a small but useful step at the Commonwealth Finance Ministers' meeting in Port of Spain, Trinidad, last September.

3.55 p.m.

Lord Thomas of Swynnerton

My Lords, I too should like to thank my noble friend and kinsman Lord Montgomery of Alamein for introducing this debate which has already been both interesting and important.

I take issue with the overwhelmingly negative picture of Latin American relations with the United States given by the noble Lord who has just sat down. He mentioned a number of instances in which the United States is supposed to have obstructed Latin American countries on the path to democracy. However, if the United States was involved at all, it was merely assisting the process of democracy against regimes which he may find to be sympathetic but which happen to be on the Left.

The noble Lord instanced Chile, Nicaragua, E1 Salvador and Guatemala. There is no clear evidence that the United States was as a government involved in any coup d'état or attempted coup d'état in any of those countries, with the exception of its operations in Guatemala in 1954 and what happened—or did not happen in fact—in Nicaragua in the 1980s. The Nicaraguan Marxist regime was ultimately overthrown but I do not believe that it can be said that that was as a consequence of the CIA or the United States Government's operations. In some respects that seems to me to reflect the curious mixture of idealism and hopefulness which characterises so many on the Left in Western Europe in relation to Latin America.

A friend of mine, Carlos Ranhel, committed suicide because of his despair at not being able to put over his point of view. He wrote a book called From Noble Savage to Good Revolutionary which indicated that Latin America had always played a part in the imagination of Western Europe or the United States—an extension of Western Europe in those terms—which bore very little relation to reality. The noble savage was neither so noble nor as savage as Voltaire considered; and that played one part which was balanced by the image of a Latin American revolutionary in the 1960s—a saintly warrior fighting against purportedly evil regimes in the interests of Utopia. However, in many ways that was a fantasy deriving from ignorance.

Ignorance has certainly been an important element in the attitude of Western Europe and Britain towards Latin America. I believe that Jonathan Cape offered a dictum and good advice to any would be publisher just starting his business career: in your first year never publish a book about Latin America but always publish a life of Nelson. Perhaps that is still a typical characteristic of our attitude towards Latin America in the 20th century.

In other centuries it was very different, particularly in relation to Britain but also in relation to other European countries. Britain was the dominant power in Latin America between the beginning of the 18th century and the beginning of this century. Many of your Lordships will recall that for a time Argentina was regarded as the sixth dominion; and Latin American place names understandably play a part in the British literary and artistic imagination. One can think of such names as Portobelo and Nombre de Dios. That point is very clearly made. Every English novelist in this century of any quality, from Conrad to Huxley, from Graham Greene to the author of Under the Volcano, went to Mexico and was inspired by a visit to that country.

On a more mundane level though a level which Members of your Lordships' House will perhaps recall more vividly, the British founded navies and insurance companies and built railways, public utilities and businesses throughout Latin America. The seated figure of the first Lord Cowdray at the Port of Veracruz—which he built—is in some ways symbolic of that association, as are the numerous plaques in remote squares of long forgotten provincial capitals which we see when we travel in Latin America. They commemorate the role played by British citizens in the independence of Latin America at the beginning of the last century. The fact that many of those volunteers for liberty were Irish is perhaps a reflection of the mismanagement of our affairs rather than anything else. Nevertheless, one will find such plaques everywhere, from Caracas to Argentina.

It was not simply one-way traffic. Lord Curzon in your Lordships' House in 1919 said that victory had been brought to Europe on waves of oil. He was referring to the oil brought from Mexico by Lord Cowdray. Nor is it just a matter of big issues. Anyone with a twinge of historical sense will be recalling next week that the principal items making up his Christmas dinner are basically Latin American products. I refer to the turkey, the potato and the tomato; and if he is lucky he may smoke a cigar and eat chocolates. If he is very grand perhaps he will be able to help himself from something which we call Georgian silver but which was basically Mexican silver. If he is fortunate enough to dine in a panelled room the odds are that it will be Nicaraguan mahogany by which he will be surrounded.

The contributions of Latin America to Britain and Western Europe have not been entirely positive. The ancestors of any hereditary peers may have had their lives foreshortened by the great Latin American contribution to Western European diseases, namely syphilis. Many may say that that is a fair revenge for Western Europe's contribution to Latin America of measles, influenza and through the slave trade of malaria and yellow fever.

What relevance has all that to the present situation? It is always difficult to relate historical experience to contemporary practicalities. I believe that those who trade with Latin America are helped by the knowledge of our historical past and by being reminded of the colossal role which British traders—capitalists and investors—played in the past, not to speak of the volunteers for liberty to which I referred.

It is also important to be reminded that Latin America in every sense except the purely racial is a department of European culture. Latin America is hardly a part of Europe, though I confess I once heard the great French historian Braudel claiming that Brazil was essentially a Mediterranean country. Nevertheless, it plainly is a part of Christendom —a word we once used as a synonym for the West. That is how we should place Latin America, rather than as a part of the third world which has no institutions and no connection with Western culture.

I recall that during the Falklands war I said with some reluctance to a banking friend of mine, "Whatever you may think about this conflict, it is the first war won by the West since 1945". His reply was, "It is a great pity that it was also against the West". In some ways that illustrates the position of Latin America in our society. I feel that in the future Latin America will play a very positive part in what the present US Secretary of State spoke of as evolving a new world order. That is a slightly ominous phrase but I like to think of it in the most positive sense.

As my noble friend and kinsman pointed out, most Latin American countries are now democracies; most subscribe to the principles of the free market. Many have given good examples in that respect, in particular President Salinas of Mexico, who visited London and made a speech in this House earlier this year. Most Latin American countries have been remarkably persistent and good members of the United Nations. I suspect that they will play a considerable part in the future. We must not forget that both Mexico and Argentina—to take countries at the extreme ends of the Latin America geographical spectrum—are sending contributions to the Gulf.

The Minister of State, Foreign and Commonwealth Office (The Earl of Caithness)

My Lords, I hesitate to interrupt my noble friend in his very stimulating and interesting speech but perhaps he could consider the time.

Lord Thomas of Swynnerton

My Lords, I do so and sit down.

4.7 p.m.

Lord Walston

My Lords, first I offer my brief but sincere thanks to the noble Viscount, Lord Montgomery, for giving us the opportunity to have a debate on this enormously important part of the world, and for introducing the debate in such a brief, concise and stimulating manner. On a purely personal note, I should like to congratulate the noble Lord, Lord Aldenham. I was an old friend of his father and we discussed the Caribbean and Latin America on many occasions. The noble Lord made an admirable speech which gave a lovely picture of a lovely country. I wish we could have heard more, and I hope that we shall do so.

I shall confine my remarks to an area which, not surprisingly, has been entirely neglected in this debate. I refer to one of the outposts of Latin America; namely, Cuba. It is an extraordinary and potentially important country. I had the pleasure of visiting it on several occasions. The last time was with the noble Lord, Lord Selsdon. We could tell many stories about it; but that would take too long and may not be very helpful.

As we all know, since the Castro revolution Cuba has been an outcast in the whole of the Latin American scene. It should not be an outcast. I shall not go into the pros and cons of the policy of the United States towards Cuba. However, it is worth remembering that in the pre-Castro days Cuba was ruled in the final instance—the last of a longish line—by a man called Batista. He allowed and encouraged the most appalling social injustices, cruelties, inequalities and corruptions. Whatever else Castro may have done or failed to do, he removed those injustices. He created a country where, admittedly, there are political prisoners—I do not condone that for a moment—and only a modified form of democracy, which I should like to see greatly extended, but a country where a lot of potential has been developed.

A far greater social equality has been introduced and education has been increased enormously. The number of people going on to higher education and universities has gone up by leaps and bounds. The countryside has been developed with better housing, schooling, roads and transport. At the same time, Cuba now has a health service and a medical profession which is the envy of many far more developed countries in the world and certainly the envy of many countries in Latin America. Therefore, there are many pluses in addition to the aspects we are more inclined to hear about.

There is a point worth remembering. Your Lordships may have seen in the newspapers recently the efforts that are being made to improve and preserve the environment, particularly the historic buildings in Havana and elsewhere. The country is not entirely materialistic or one of these pseudo-communist countries which prove the failure of that type of economy.

As I said, I shall not seek to balance out the pros and cons, but I remind your Lordships that Cuba is a country of about 10 million people—a not insignificant country that has great resources. It has an educated and healthy population. It has a good internal communications system. Cuba has resources in the form of fertile land with a potentially important sugar production, tobacco production, and so on. It has attempted to diversify and to some extent has succeeded. It has minerals and a certain amount of industry. In other words, one can say that Cuba is poised on the brink of an economic take-off. However, it cannot take off while it is isolated, above all, by the United States and to a large extent by its other, on the whole, poorer neighbours.

Until recently, Cuba has subsisted on the charity of the Soviet Union, for obvious reasons. It has been feared by the United States for exactly the same reasons, and that is why we have had such episodes as the missile crisis, the Bay of Pigs, and so on. That is all history. The cold war is now coming to an end. The influence of the Soviet Union, in so far as it had any influence in Latin America, has disappeared. The threat to the United States is no longer there, so surely the time has come for the past to be forgotten and Cuba given the help that it needs—and, my goodness, it needs a lot of help particularly with its sugar industry.

I remind your Lordships that sugar is the kingpin of the Cuban economy. It is one of those peculiar commodities which does not entirely depend on a free market. Not more than 15 per cent. of the world's sugar production is sold on the free market. The other 80 per cent. to 85 per cent. is the subject of preferential treatments, the common agricultural policy, import allowances and various other arrangements of that nature. Now that assistance from the Soviet Union is fast disappearing the plight of Cuba, if left to itself, will be little short of disastrous. The effect on that part of the world can only be bad on what one can almost call a poverty-stricken slum—not that it is that yet, but it will become so unless the West takes some steps to replace the enormous assistance that has been given by the Soviet Union.

I urge Her Majesty's Government to take such initiative as they can in bringing Cuba into the comity of Latin American nations, of their own volition and through the Economic Community; certainly through Spain and, to a lesser extent, France. There will be no lack of allies. Above all, the Government must use such influence as they have on the United States to draw a line under the events of the past 30 years and to look on Cuba as being potentially an extremely important area both for the economy of Latin America and for trade with this country.

4.15 p.m.

Lord Selsdon

My Lords, I thank my noble friend for introducing this debate but I wonder why it is necessary. With such a vast continent and all its resources, why do we need to draw attention to it? Possibly it has something to do with history, and we have had a history lesson today. One must ask: why did we have such a close and developed trading relationship in the past and why not today?

Before the start of the debate my noble friend Lord Orr-Ewing passed me a note which I hope my noble friend will treat as a compliment if I repeat it now. He said that I should remind the House that in the 1920s it was said: Antony Gibbs made their dibs, from the turds of foreign birds". I take that as a text because in those days we went abroad to buy. We did not go to sell. We went to countries that had natural resources that could help our industrial revolution, to develop and expand our own trade and to add value. However, as the world demand for products shifted so countries like Chile, which had one or two products, faded away and countries that had failed to industrialise or develop lost their appeal to the buyers. Those buyers were from many great families and they took great risks. They made contributions to many of the countries of the world, but they fell away and the sellers came along.

I was always told of the philosophy that if you wished to sell a product you never tried to sell but always bought; that you should never let anyone know whether you were a buyer or a seller because there was a big difference between bid and offer. If you wanted to know whether you should buy or sell you should offer your most prized possession for sale and if everybody wanted to buy it, you sold. If nobody wanted to buy it, you bought.

The prices of commodities and products throughout the world today are at an historic low. We assume that they are so low because they are no longer desirable; or perhaps they have had their day and no added value can be created. I know not the reason, but when the sellers came and endeavoured to sell products that the buyers did not want those of us in the banking world were not far behind because trade and finance are linked. We came along, encouraged by governments of all political creeds, colours and religions, and we offered money to people to buy products that they did not really need. They did not know what to do with them. Vast white elephant projects emerged. Perhaps again historically, if you consider Latin America, the buying came first and with it came what today are considered white elephant projects but in those days were the great industrial infrastructures that were set up for the benefit of the countries concerned.

Following this wave of what I deem to be irresponsible and misguided lending, based more upon a lack of knowledge than any foolish attempt or ill will, we created this vast mountain of debt, to which the noble Lord opposite referred. It is a debt of which 40 per cent. is unlikely to be repaid. At the same time, in the developed financial markets of the world we did something that historically was perhaps equally unforgiveable. We floated currencies all in one go. The initial attempt was to float for a short period of time to stabilise one country against another. Gradually that floating caused problems and differentials in exchange rates. It created debts in the wrong place and, with them, interest rates rose to combat inflation.

The purity of trade fell away, because all trade historically comes first, before finance. However, even before that comes politics and if there is not an adequate political environment in which to trade, traders will not trade—neither buyers nor sellers. Over time in Latin America we have seen such political shifts that there have been fears and nervousness throughout industry and all aspects of commerce. That nervousness has led gradually to a complete and utter lack of knowledge among the managers of industry who seldom visit the countries. Indeed, that applies to Ministers in Her Majesty's Government. I hang on to the coat tails of the noble Lord, Lord Walston, from time to time regarding countries about which he is knowledgeable. He is the only Minister who has visited Cuba. Even then the Foreign Office said that he must go in a private capacity.

I have been there on many occasions. I find it a strange and interesting country with almost two faces. One face shows the barriers and shutters up against the United States and on the other they are down. It is said that it is impossible to get there. However, I have one privilege in life in that I believe I hold the world record for the journey from London to Havana and back to London. I was telephoned and asked to go to lunch. I took Concorde to Miami and quite happily flew from Miami and over Valadesa and back the next day.

The noble Lord, Lord Walston, and I warned the Cuban Government that if they spent all their time in Moscow's pocket in due course countries and attitudes would change and Cuba would remain isolated as perhaps it is today. Hence there is an opportunity for this country to increase its trade there. Before we can move much further there is a need for closer ministerial relationships and understanding with all countries. Only when the political climate is perfectly right will industry follow. Industrialists—or the private sector, as we call it these days—pay far more attention to politics than politicians believe. It is vital to know that there is a stable relationship between these countries and all the countries of Latin America with which we wish to trade.

It is equally vital that we sort out somehow at government and international level the question of indebtedness. To a third world country it is practically impossible to sell anything meaningful these days without some form of finance and an acceptable schedule for repayment. Too many countries of the world have had the unpleasant experience of being unable to pay their mess bills and then being called to some smart club known as the Paris Club where they are kept waiting by officials for weeks or months before trying to reschedule the debts. That is a very unpleasant experience for any country and particularly for its Ministers.

When my noble friend replies today can he let us know the view of the Foreign Office and Ministers at the moment? To some extent we have a Minister for Latin America. Will he be visiting Latin America shortly and will the Government be making a greater effort? I hope so.

4.22 p.m.

Lord Molloy

My Lords, I offer my sincere congratulations to the noble Lord, Lord Aldenham, for a maiden speech which was almost unique in that he could speak for two countries with deep and genuine feeling. He therefore made his maiden speech attractive and informative. It was worth coming to the House today to listen to the noble Lord going back over the history of his family and of his own personal feelings. He created some kind of link between our island, Chile and other Latin American states. I also wish to express my appreciation of the Inter-Parliamentary Union, British branch, for the work it has done in assisting us and for the work that it does generally in helping us to keep international contacts throughout the world, particularly in Latin America.

I join the noble Viscount, Lord Montgomery of Alamein, in expressing appreciation of Canning House. It has made a remarkable contribution to most countries of Latin America on behalf of our country. It has helped and encouraged the establishment of good trade relations which has always been preferred to aid. If Canning House can carry on its efforts, that will be to the advantage of both Latin America and this country.

Our association with the states of Latin America leaves a great deal to be desired. The noble Viscount, Lord Montgomery of Alamein, seeks and gives examples of change and of the way in which to improve our relations with Latin America. He is the only person I know who can use his status as a president of our association and combine that with all the urgency of a Chief Whip when a matter is on the agenda concerning our group and any part of Latin America. He deserves our special praise because he keeps us all on our toes. He also ensures that we are directed to the places where we can get proper information.

As I understand it, in a month or two, President Aylwin will be taking over in Chile. That country is striving to remove a distasteful past, and it is succeeding. The 1989 reforms of the former military constitution are being changed, but there is still a great deal to do. I hope that our country will help Chile in its endeavours to create a just and fair country and to establish its own form of democracy which is acceptable to all others.

These days we cannot mention Brazil without thinking of the great problems of the rain forests. The future of this planet could depend on that country. Therefore I should like this country to have more to do with Brazil. At the moment Brazil is still suffering from a degree of lawlessness. There has been an awful report From Amnesty International. However, Brazil is sincerely struggling to improve its democracy and social reform programme; but it has problems. We can help Brazil by understanding its problems. For example, we can help that country to try to get rid of its drugs problem. Britain is in a special position to do something about all those problems. Brazil is the largest state in South America with a population of 141 million most of whom I understand to be Roman Catholic. It is following the democratic path which began in 1946, and that democracy is still developing. As I understand it, the collapse of the Cruzad plan in 1987 was succeeded by the 1988 constitution and social reform programme, and that shows encouraging headway.

To turn to Argentina, I hope that after the Falklands episode the diplomatic ice is thawing. As I have said on previous occasions, travel restrictions have been removed. I understand that Mr. Hurd, our Foreign Secretary, has had useful discussions regarding the South Atlantic fisheries. There has also been the Madrid agreement. I also wish to compliment Mr. Tristan Garret Jones on his recent visit to Argentina. He spoke a great deal of good sense on behalf of this country for the encouragement of Argentina.

I wonder whether the House would consider sending me, my right honourable friend the Leader of the Opposition and the Chairman of Committees, to Patagonia because we have something in common which I believe will be of great advantage to that part of Argentina. If that did not enhance the reputation of England, Scotland and Ireland, it would certainly allow Wales once more to make a very valuable civil contact. People have left my own little country and have gone to Latin America and they are particularly admired and respected.

In Nicaragua there is a serious challenge to peace and democracy even after 10 years of civil war. International help through lending agencies can combat poverty and inflation, and avert disaster. When the Minister replies, I hope that he will refer to this matter because there is a serious situation in that country. From my own researches, I am of the opinion that the mass of ordinary people would enjoy and would know how to use the form of democracy that we enjoy if only they could have some help.

In El Salvador, President Cristiani is under siege. He has done reasonably well. Cuts in the army have been urged. In my judgment, the aid package from the United States should be renewed. One has in mind the awful international condemnation concerning the death squads and the slaying of innocents. However, it does not help to shut one's eyes to these matters and to withdraw totally. That is the wrong thing to do. The British, Americans and others of the great democracies should try to get involved in E1 Salvador in order to show that country that it is going the wrong way. If we are prepared to do that and give practical economic and moral assistance, that would make a large contribution.

Guatemala faces charges of sham electoral processes. All these matters are worth pointing out because if there is a sincere desire to see a better relationship between the Latin American countries and our own, first and foremost we should acknowledge that there are certain things that we do not like; but, nothwithstanding those factors, we wish to work, help and trade with them. The present violation of basic human rights in Guatemala should be challenged by us. We should allow parliamentary delegations to go there to stress that point. We are particularly good at that kind of function.

In Peru I understand that President Alberto Fujimori is a member of the Japanese ethnic Christian minority. It is amazing that in this so-called Latin America, where all kinds of terrible things are going on, someone with that background can become president. I am quite sure that if the noble Lord, Lord Aldenham, had been there he would have been a president by now—and easily the most popular one of all time. Peru has to bear an enormous burden of foreign debt; and of course we realise that is plaguing it. Perhaps the Minister can examine some endeavours or initiatives which would help Peru in trading.

In conclusion, I should like to say a word about Latin America. I owe most of my knowledge about Latin America to the endeavours of the noble Viscount, Lord Montgomery of Alamein, and I am very proud of being able to assist him because he is so worthy of being assisted. He is certainly a very good chief whip and a very good leader; but the fact that he is always successful is reflected in the number of times I have to get up on my feet to assist him—or should I say to help him?

Latin America needs the support of Europe and the United States of America. Through the United Nations and other international organisations I hope that we shall be able to become involved in the desiderata in order to build a civilised and healthy Latin America which we all want. The way has been indicated by the noble Viscount, Lord Montgomery, and all we have to do is to back him up and ask the Ministers to do likewise. I am sure that would be good not only for Latin America but also good for Great Britain.

4.31 p.m.

Baroness Gardner of Parkes

My Lords, I too am a great admirer of the noble Viscount, Lord Montgomery, and I am grateful to him not only for introducing this debate but also for the excellent advice he gave me when I was setting out for South America this year. I suppose that my interest in Latin America stems from being an Antipodean myself. It is also related to the fact that my father, as a young Member of Parliament in the New South Wales Government at the time when the Brazilians withdrew from Australia, was asked if he would take on the job of honorary vice-consul for Brazil. That happened in 1920 and time wandered on, and he still retained that office until the day he died in 1949. It was many years after that before the Brazilians reappointed someone to a new diplomatic position in South Australia.

My interest has been doubled by the fact that this year I have taken on the United Kingdom chairmanship of a children's charity concerned with fostering children, which is called Plan International. We do a great deal of work in South America and I was able to combine my attendance at the inter-parliamentary conference in Uruguay with a visit to see work in the field in Ecuador.

Ecuador is a fascinating country because you can stand with your feet on either side of the equator and see right above you snow-capped mountains. It is hard to believe that there can be such a contrast, with the snow there right on the equator. I visited two projects. One was in Canai, which was in the hills, and the other was in Guasmo, a slum area, which was mentioned by the noble Lord, Lord Rea. The Canai project was very much a rural one, in very mountainous country. People there were shown how to grow various vegetables. Indeed, they asked us what they should do with broccoli after they had grown it. They had grown it very well indeed but they did not know quite how they should treat it. They were also having lessons in producing more interesting food for the population so that they could have better nutrition.

I was intrigued to see the hat-making and to learn that most of the hats we call panama hats in this country are made in Ecuador. Of course a lot are also made in Mexico. We saw people weaving with incredibly nimble fingers the most complicated and fine hats, starting with 24 strands and gradually adding in more and more. They explained to us that for their raw materials they have to pay 20 US cents and that it takes them five days to get the hat to the point at which they can pass it on to the next person, who finishes the brim. For five days' work they receive 80 cents, and when you think of the prices people throughout the Western world pay for those hats you realise that there are a lot of other people making money along the way.

Guasmo was a complete revelation to me. This had been a swamp area and people had squatted there and colonised it: it was an area that was almost completely uninhabitable, one would have thought. Our organisation had been able to put in hard core, so that instead of walking through mud you were able to walk along a road, but the houses still had to be built on stilts in most cases. I have called them houses, but really they were just shacks.

However, it was fascinating to see that in the small bamboo shacks of three rooms people had given up one room to create homes for help and to make child clinics available for mothers and babies. It rather puts our National Health Service to shame, but they had a 95 per cent. successful immunisation programme of the children in that terrible area. There was no running water: people had to buy water which was brought in on tanker trucks. It took one-quarter of the family income just to buy enough water.

I had a meeting with the vice-president who explained that the World Bank was prepared to give them the money to run a pipeline. I hope that will be done. But when we went away people told me that prospects were really very limited. There are such enormous vested interests in the water supply that we may never really see the pipes there.

My trip through South America coincided with the time when the Minister, Tristan Garel-Jones, who has been referred to, was making a visit. I should like to place on record the great credit that he received as the first Spanish-speaking Minister ever to have represented this country in that part of the world. It made such a difference that he was able to communicate directly with people. I would remind your Lordships that in this House we now have Spanish-speaking classes. I found that even the little I had learned was of enormous benefit to me.

I went also to Peru, but just as a tourist. There I was amazed to learn that before the new government took over—and I have great hopes of them—inflation during the previous year had reached 14,000 per cent. We simply cannot contemplate inflation of that dimension. One friend I met told me that she had gone for a meal one evening and the price was 10 US dollars. She went the following evening for the same meal. When she arrived the price was still 10 dollars but by the time she had finished eating it had gone up to 25 dollars.

Peru has about 400,000 tourists a year: that is only 1,000 a day in a country which so many people would love to visit. However, we have all heard the stories about personal safety, although we ourselves had no such problems. When I was about to set off I said to the noble Viscount, Lord Montgomery, that I believed it was rather dangerous and he said, "It wouldn't stop me." That was good enough for me. I went on that basis and we had no trouble at all. In London, we have 20 million tourists a year: 50 times as many as Peru has. Really, Peru desperately needs the income that more tourists could bring to them.

All the people in the Andean area are industrious; they are interested and keen to learn. They are willing; they are never idle. As they are walking between their farms and where they sell their goods, which is often a long way, they are weaving or knitting. You also see them carrying enormous gas cylinders. We have to appreciate the work and the willingness of these people, but stable government is the most essential thing. Democracy is of course the answer for them. They also need a stable currency. The noble Lord, Lord Selsdon, mentioned stable relationships between countries. These will come when we have a stable relationship and a stable situation in the country itself.

I would never underestimate the value of co-operation between the developed and developing countries. The ODA has been very good in funding projects done by our organisation overseas. People in this country who give voluntarily, through the Government or through overseas development agencies, should appreciate that their money is put to very good use: not a penny is wasted. I look forward to greater co-operation between the developed and the developing countries.

4.40 p.m.

Lord Chorley

My Lords, I must begin by apologising to the House because I have not been able to listen to most of the debate today. Unfortunately, I was detained on other business in a Select Committee. In particular, I regret not having been present to hear the speech of the noble Viscount, Lord Montgomery. I believe that all of us would agree that no one knows Latin America better than he or has such a wide experience of the area. However, I shall read the report of his speech, and indeed of all the others, with great interest.

For my part I cannot claim to have any real knowledge of Latin America, and certainly nothing like that of the noble Viscount. I suspect as a nation that we do not have the same sort of knowledge about the area as we have about Africa, Asia and indeed the old and new Commonwealth. We also enjoy a warm relationship with the United States. Yet historically in the 19th century we had extraordinarily close contacts in the area. We had huge investments there, such as the railways. Moreover, Argentina was thought to have better prospects than the USA. It seems surprising today that that should have been so, but it was indeed the case.

Latin America is a huge continent, as I am sure has already been said. It has a great history and civilisation. The first time I visited the area—and this, I suppose, shows my historical ignorance—I was surprised to note that it was colonised a hundred years before North America. Historically it has close ties with continental Europe. However, for the most part it has remained a developing economy, if one can generalise about such a vast continent. It is also true that it has some major pockets of fully industrialised industry.

In short, Latin America is clearly a continent of great importance. It is a continent with a huge richness of natural resources—both exploitable resources and what one might call environmental resources. Therefore Latin America —and this may already have been said during the debate—will be a major player in how we manage our planet in striving to arrive at the right balance between exploitation for economic progress on the one hand—that is, in the narrow sense—and conservation on the other and in striving to arrive at what we now call sustainable development. That is no easy task for a continent with rather low standards of living.

I turn now to my main theme. In no case is this development more important or more acute than in the case of the tropical rain forests. We should remind ourselves that two-thirds of the world's remaining rain forests lie in Latin America and one-third of the total lie in Brazil. We all know of the threat to the rain forests. The destruction is not just from misguided attempts to convert the forests into cattle pastures, often solely for fiscal advantage; it also comes from large-scale logging for Western markets, from huge hydro-electric power schemes, from large-scale mining enterprises and from road building.

The damage caused to the area by such schemes is not just the loss of trees. There is also the loss of bio-diversity. I believe that it is true to say that Amazonia is probably the richest area biologically in the world. It is an area which may be of considerable importance to the economic development of natural pharmaceutical products. There is little doubt too that destruction of these forests on a wide scale may have incalculable—I use that word in the strictest sense—effects on the micro-climates of the area; that is, the local climate. It is well known that slash and burn destruction for cattle ranching and so on adds to the problem of greenhouse gases and global warming.

All that is well known and well documented. However, what is less certain is the rate at which destruction is taking place. The figures which are published vary hugely. That is partly because it is no easy thing to measure. Indeed, there are problems of definition and of sheer measurement. It is interesting to note that these problems were fully discussed and explained at a recent meeting of the Royal Geographical Society by a senior Brazilian scientist, Dr. Barboza. His best estimate is that to date about 6 to 7 per cent. of the forest has been destroyed. That figure is in fact lower than most people expected. But, nevertheless, we should remember that the catchment of the River Amazon, where the main forest is situated, is as large as Western Europe. It is a huge area, which I have flown over. I am sure that anyone else who has done so will agree with me on that point. Indeed, you fly for hours and see nothing but green trees.

The Brazilians have been very sensitive to Western criticism. I believe that that is quite understandable. No poor country likes to be told what to do about managing its affairs by a rich country, partly for the benefit of that rich country. I suggest that we in the West have hardly been very tactful in the matter. However, I believe that attitudes are changing. Britain has been important in bringing about this change. As a past president of the Royal Geographical Society, I should like to point out that the society, through its Maraca Scientific Project of 1987–88—incidentally, the noble Viscount, Lord Montgomery, was chairman of the committee which oversaw the project—has been an important factor in improving relations.

Leaving aside the important scientific work carried out by both British and Brazilian scientists, the Maraca project engendered a really good trust between the two sides. No political statements were made. The first project conference took place in Manaus on the Amazon and everyone spoke Portuguese. The scientific agenda was worked out with our Brazilian colleagues, and so on. All in all it was a skilled piece of scientific and cultural diplomacy, if that is the right phrase, by the leader, Dr. John Hemming. Moreover, it led the way to a fruitful visit by the then Minister for the ODA, Mr. Chris Patten, and that in turn led to an intergovernmental accord. I believe that no other country has reached a similar agreement with Brazil. Therefore, I very much welcome the initiatives of the ODA and the work which it is beginning to carry out in Brazil.

As I am sure has been mentioned, Brazil now has a young and energetic president who told us at the RGS last year that he was determined to stop forest clearances in Amazonia. He has appointed an equally determined, energetic, very "green" and rather remarkable environment minister. Only last week we heard that the murderers of that great rain forest folk hero, Chico Mendes, had been convicted.

Those are all encouraging signs. Moreover, there are other similar changes of attitude in other Amazonian countries. For example, Colombia has a good conservation record. In February I visited Venezuela and had a meeting with the president. I was most impressed by the lively and real interest which he took in environmental matters in his country. He struck me as being very well informed and, indeed, he has a good track record. Incidentally, the Venezuelans have in London as their ambassador a man who has a great reputation in environmental matters and who is a true friend of the United Kingdom.

I must now bring my remarks to a close as I see that my time limit of eight minutes has almost expired. However, I do so on a hopeful note—something which I suggest would not have been possible two or three years ago.

4.48 p.m.

The Earl of Radnor

My Lords, I am probably very badly equipped to talk about Latin America, which is the subject of the debate. It is an enormous continent which has tremendous variety, enormous potential and very real riches. Therefore, I shall concentrate upon one country about which I know a little—the Argentine. However, before I do so I should very much like to congratulate my noble friend Lord Montgomery on bringing the matter before us today, albeit in a debate of only two-and-a-half hours. He has done much to bring that continent to our notice, which must at times have been hard work for him.

Picking up odd remarks which have been made during the debate, it seems quite unusual that Ministers, even junior Ministers, do not visit Latin America. I shall reinforce the remarks made by one noble Lord. I should like to know whether anyone will be going to any of these countries in order to make contact. I do not see how anything can move forward happily if people in the two continents do not have contact with one another. That leads to inertia.

I shall outline my interest in the Argentine. I worked there for two years as a young man in the days of Peron, which were not perhaps the happiest for that country. We were having meat talks and trying to get trade going between the two countries on the basis of exchanging goods from this country for meat, of which in those days we were short. It was not a happy negotiation. Since then, to put it crudely, things have gone from bad to worse, culminating in the unfortunate, but mercifully over, war.

I built a house in the Argentine. My wife carries an Argentine passport as well as an English one. I married into a considerable Argentine family. I have many friends there, and many Argentine friends here as well. Now that things are going so much better between our two countries and we have welcomed Senor Cámpora the Argentine ambassador and sent our man to Buenos Aires, it is most important that we build as firmly as possible upon all the positive achievements and try to put behind us—not forget, because it is impossible to do that—the Falklands war.

The noble Lord, Lord Shackleton, said that he was a Falklander. I would not say that of myself. I believe sincerely in the self-determination of people. Trade is always the best option and it should be developed with the Argentine after the happy new beginning. The fisheries agreement between the Argentine and this country is beginning to be seen to be working well. I understand that the agreement was an original one. It had a great deal to do, as has already been said, with the careful negotiation that was carried on by both sides when people did not take immovable positions. Everyone on both sides should be congratulated on that achievement.

I dare not mention the Antarctic in front of the noble Lord, Lord Shackleton, but I gather that there is also considerable agreement in that area. No one has mentioned that at the moment the Argentine and ourselves are allies in that there are two Argentine battleships in the Gulf with ours and those of other nations.

I cannot say that we should forget the debts—I am afraid that in the end some of them will have to be forgotten if anything is to happen—but if there is to be trade there must be a proper milieu in which it can take place. That brings me to what I believe is one of the most important points—the failure so far of the GATT round. If the world divides into blocs, with protectionist barriers around Europe and America, including South America, the Cairns Group, of which the Argentine is a member, it will be even harder for the whole of South America and ourselves. I speak as a farmer in this country who will probably suffer considerably if the subsidies that we have enjoyed through the CAP disappear. The whole world will suffer a great deal more if the talks, which I believe are to be held again on 15th January, are unsuccessful.

I ask my noble friend the Minister to reassure the House that every effort will once again be made to keep the Uruguay round going because it is of the greatest importance not just to South America, this country and Europe but to the whole world. Will he tell us whether there is any possibility of our taking a less firm view of the CAP, which seems to be one of the two stumbling blocks?

I have just about come to the end of my time. I have managed to make one or two points. I have one to make to the noble Lord, Lord Molloy. He does not seem to realise—there is no reason why he should—that my house is in one of the Welsh enclaves that he described. He did not mention that the Welsh eisteddfod was won by a 16 year-old Argentine girl who came from Trelew.

4.56 p.m.

The Viscount of Falkland

My Lords, I have no direct knowledge of, or contact with, Latin America although the islands, which your Lordships know well, bear the name of a remote forebear. I have however many friends in Latin America, and thanks to my friend—if I may call him that—the noble Viscount, Lord Montgomery of Alamein, I have learned a good deal over the past few years. I thank him for giving us another opportunity to discuss the whole subject of Latin America and to learn so much from the contributions of your Lordships.

In 1973 I was returning from a business trip to New York. Being of a chatty disposition, I spoke at some length to the person occupying the seat next to me. We had a most interesting talk: he turned out to be the Nicaraguan ambassador to Rome. He described his country and of what it consisted. He said that his greatest worry was the great divisions between those who held most of the wealth—several families—and how the transition to a peaceful new order would be achieved. We know the sad happenings of that country. It has unhappily been the pattern in large parts of Latin America.

I congratulate the noble Lord, Lord Aldenham, on an excellent maiden speech. It was most moving to hear his description of the effect on him, his family and friends of the terrible disaster that occurred in Chile when that country was torn asunder by the political polarities that existed. We are encouraged when the noble Viscount, Lord Montgomery, tells us that the rhetoric of nationalism has decreased markedly. There has been political improvement overall in many Latin American countries. Economies are by and large better managed; but many countries are still burdened by the enormous debts with which they were shackled when so much money was available from the Middle East through private banks. The money was misdirected. Such large amounts were loaned in such an ill-judged way in many cases that countries are still carrying the debt. I shall be interested to hear whether the Minister refers to the Government's attitude towards the reduction of debt liabilities in Latin America and how we can influence some of the commercial banks in that area.

The party which I represent has a particular interest in the environment of Latin America. We are all interested in it; we know the important part that Latin America and particularly Brazil play in the future of the environment not only there but throughout the world. Great efforts are being made but even more could be done by countries in Latin America to stop the decline in the quality of their environment.

I am sure that the Minister who will reply to the debate will have views on how we in the industrialised world can encourage and reward countries for their efforts. That is important. It is no good expecting people to make sacrifices in countries with problems of large populations and great poverty. They must receive a return for the efforts they make.

There is great concern about drugs and drug abuse. It is simplistic to take the view, perhaps encouraged by the media, that Latin America, together with certain parts of South East Asia, is irresponsible in the way it produces the basic products for many of the narcotics which cause disaster in the world today. It is true that in Latin America, in the countries of the high Andes—Peru and Bolivia—where the coca leaf is grown, it has played an important part in the agricultural economies of those countries. That crop has been developed and encouraged and has given a means of living to the poor people who grow it. However it is then taken out of the country and processed, particularly in Colombia.

The major profits from this awful business, governed largely by criminal organisations, go to the middle man and the criminal organisations but not to the peasants who are the growers. The coca leaf has always played a part in the life of the peasant in caring for his health. It has been chewed and mixed with lime. This has had a satisfactory effect in resisting cold, hunger and the effects of high altitude. It has played an important part in the religious life of the countries of the high Andes.

It is a tragedy that in our developed world the need for mood-changing drugs has reached a level where there is such a market that people are exploited. They get very little out of it; the crime organisations reap most of the benefit. In this country, very little cocaine is used compared with other drugs. Perhaps that has to do with the geographical location of the United States which has more of a cocaine problem. We have other problems. I do not wish to upset noble Lords, but this is mainly due to the National Health Service making so many drugs available to people. It has created an addiction which goes way beyond that found among people who take heroin, cocaine and other drugs. However, amphetamines are becoming a worrying problem. We are net exporters of amphetamines which are easily made even in council blocks.

It would be simplistic to suggest that we could alter the supply of drugs in Latin America by eliminating the fields where the plants are grown. It is a matter of dealing with the demand. If we destroy a field of coca plants, it will merely be planted again: the demand still exists. The demand can only be countered by treating those who are unhappy enough already to be sufferers and by educating young people in our society to make sure that they understand the dangers of taking drugs.

I thank noble Lords for listening to a hurried speech. I agree that the situation is more optimistic than it was, and I hope that the Government will be able to give an encouraging reply to the excellent debate.

5.5 p.m.

Baroness Ewart-Biggs

My Lords, the noble Viscount, Lord Montgomery, gave a comprehensive and vivid background to the debate. I am sure that he will be happy with the varied contributions made. Noble Lords have covered an enormous number of aspects of the subject. I wish particularly to mention the speech of the noble Lord, Lord Aldenham, because I was moved by the account he gave of a country that is clearly close to his heart and his description of the struggle the Chilean president is making to support democratic practices. He may be sure that we all join in hoping for his success.

The debate has also given us an opportunity to welcome many developments in Latin America over recent years. We have mentioned that many countries now follow the path of democracy. We have also spoken of the re-establishment of diplomatic relations between the United Kingdom and Argentina, a source of great pleasure and relief to us. I believe that the renewal of relations between our two countries has particular importance for the development of British relations with Latin America.

First, I wish to follow the noble Viscount, Lord Falkland, and say a word about the external debt problem of Latin America and its effect on the lives of the poorer people in the continent, particularly the children. My noble friend Lord Rea gave horrific figures of the external indebtedness of Latin America. It is true that Latin America paid out over 200 billion dollars in interest and repayments between 1982 and 1989. Nonetheless, in 1989 it owed 426 billion dollars to the rich nations. In effect, this means that every child born in Latin America today is in debt to the tune of 60,000 dollars. That is a sobering thought. We know that indebtedness has retarded economic growth there. The burden of debt diverts export revenues to meet repayments, reduces imports and deprives countries of foreign investment.

I wish to ask the Minister about the recently introduced statutory instrument with which the Government have tried to alleviate the situation. The statutory instrument ensures that the provision of up to 50 per cent. of total loans to developing countries will be treated as bad debts. As such, they entitle banks to tax relief. The question I wish to put to the Minister is whether this is happening. There is concern that banks write down the debt in their accounts and claim tax relief but in practice they still demand the full amount of the original debt from the developing country. I should be grateful for information on that. We on this side of the House believe that it is essential to ensure that tax relief to banks is conditional on the introduction of debt relief packages to alleviate indebtedness of third world countries. Perhaps the Minister will say whether he agrees with that.

The reason I wished to say a word about the effect on children is that today UNICEF launched its State of The World's Children Report. It is made quite clear that the economic crisis has had serious effects on children, but nevertheless the work of UNICEF has increased and progressed in Latin America because the governments of those countries are supportive of work for children. The health and education services have of course been drastically affected by the economic crisis. This has led to a great mushrooming growth of shanty towns. It has also led to increases in child mortality and malnutrition. There is little doubt that the so-called street children are at the very bottom of this social net. They present a very great problem in Latin America. It is thought that in 11 of the countries in the region there are as many as 7 to 8 million children living entirely on the streets. That situation has not resulted from a lack of devotion on the part of the children's families but has resulted simply from poverty. There is no way those children can stay at home and so they take to the streets.

UNICEF has received a great deal of support from Latin American countries. Some 71 leaders attended the World Summit for Children. Mexico was one of the six countries that called for the summit. As many as 19 of the Latin American countries have ratified the UN Convention on the Rights of the Child. The Minister knows that I eagerly anticipate Her Majesty's Government ratifying the convention also.

The work that UNICEF and many other organisations are trying to do to help these countries in their child survival strategies cannot succeed without the support of wealthier countries. The noble Baroness, Lady Gardner, made that point very clear. She spoke from her observation of Plan International. These initiatives will come to nothing unless they have the support I have spoken of.

My noble friend Lord Molloy and the noble Lord, Lord Chorley, have spoken of the terrible effects that the debt problems have on the environment. I do not believe that there is much that I can add to that. However, I was interested in the comments made by the noble Lord, Lord Chorley, on the efforts made by the Brazilian Government to save the Amazonian rain forest. I hope the Minister will tell the House whether there are any debt for forest conservation agreements or any code of practice for timber importing companies.

Finally, I wish to touch on a subject which has been mentioned by my noble friends Lord Rea and Lord Molloy, which is the growing concern that Amnesty International has regarding human rights abuses in Latin America. E1 Salvador was named by Amnesty International as one of the three countries with the worst records of military connected human rights abuses in 1989. I hope the Minister can tell me what progress has been made in bringing to trial those responsible for the murders of the six Jesuit priests in E1 Salvador and whether Scotland Yard has published its findings on that.

Amnesty International is also worried about the disappearances in Peru, the death squads in Colombia, the disappearance of children in Argentina and also the death squads that target homeless children in Brazil and Guatemala. I agree with my noble friend Lord Molloy that it is right to face up to these worrying statistics in Latin America. However, at the same time we applaud all that is being done to try to bring about the rule of law and democratic practices there.

I end by saying that foreign debt casts its shadow over the lives of millions of people in Latin America. Political democracy and many vital social reforms are threatened by the economic crisis that results from the debt. International agreements such as the Convention on the Rights of the Child will be worthless while social, health and education programmes are so drastically cut. It must be the duty of wealthy nations to find a solution to the debt problems of Latin American countries. Without such a solution, there is a very hard road ahead for those countries.

5.14 p.m.

The Earl of Caithness

My Lords, I am grateful to my noble friend Lord Montgomery for his initiative in enabling us to debate Latin America today. It shows again the strength of his commitment to the region and reminds us of the depth of his knowledge and experience. In him Latin America has a devoted and influential friend, as so many of your Lordships have said.

In recent years the political face of Latin America has changed beyond recognition. Authoritarian regimes have given way to democratically elected governments throughout the hemisphere, with the notable exception of Cuba. I shall say a little more about Cuba in a few moments. Hand in hand with this advance of democracy came an increasingly widespread adoption of realistic economic policies aimed at encouraging enterprise and investment and at breaking down protectionist obstacles to progress. Many Pressing economic and social problems remain to be resolved. There are still serious concerns about human rights abuses in some countries. As the noble Lord, Lord Rea, said, the burden of debt still lies heavily on many Latin American countries.

The noble Viscount, Lord Falkland, and the noble Baroness, Lady Ewart-Biggs, asked for some detail about the Government's attitude to debt. We must remember that Latin America's debt problems are different from those of Africa, for example, because Latin America's debt is largely owed to banks rather than to official creditors. We welcome the increasing willingness of banks to negotiate debt reductions with debtor countries. We support the agreement reached last year that the IMF and the World Bank should provide some of their lending directly in support of voluntarily negotiated debt reduction deals. Mexico was the first country to reach an agreement with its banks under these arrangements. I know that my noble friend Lord Selsdon is aware that debt reduction deals have now been agreed or are under negotiation for almost all Latin American countries. We welcome that. With the spread of good government, there seem much better prospects than for many years past of a serious, determined effort to consolidate pluralist democratic politics and achieve soundly based economic growth.

The policy of the British Government is to do all we can to encourage these trends and to strengthen our links with Latin America. Those links are extensive and varied, as my noble friend Lord Thomas of Swynnerton told your Lordships. My noble friend Lord Aldenham, in what I considered to be an excellent maiden speech—I too wish to congratulate him on it—told the House of his family's special connections with Chile. Like my noble friend, we particularly welcome the restoration of democratic government in Chile. We look forward to President Aylwin's planned visit next spring.

1990 has also seen the restoration of diplomatic relations with Argentina for the first time since 1982 on the basis of accords reached between the British and Argentine Governments in Madrid. Also in Madrid we have just reached agreement with the Government of Argentina on a co-operative approach to fisheries conservation in the South Atlantic. I am particularly grateful for the support of the noble Lord, Lord Shackleton, whose knowledge of this area is so respected.

Many noble lords will be aware that the Argentine Foreign Minister, Dr. Cavallo, visited London last week for talks with the Foreign and Commonwealth Secretary. The fact that this was their third meeting since April is ample evidence of the strength of will on both sides to consolidate our new relationship on sound foundations. We applaud President Menem's desire that Argentina should play a more active role internationally. Like my noble friend Lord Radnor, we have warmly welcomed Argentina's decision to send naval forces to help enforce the UN embargo against Iraq in the Gulf.

In Central America the peace process we have firmly supported made great strides with President Chamorro's clear victory in the elections in Nicaragua and the subsequent demobilisation of the Contras. The noble Lord, Lord Molloy, will recall that in April we announced our decision to create a modest aid budget for Nicaragua. We pledged a further £600,000 at the Rome donors' conference on 6th and 7th June to help meet the country's most urgent needs. The main channel for UK aid will, however, remain our contributions to the Community. I know that the noble Lord welcomes our efforts.

We also welcome the negotiations under UN auspices between the Government of E1 Salvador and the FMLN guerrillas. Despite the setback of the FMLN's recently renewed offensive, we wish the negotiations success and the people of E1 Salvador lasting respite from the tragic conflict which has afflicted that unfortunate country for so long.

Similarly, we hope that negotiations between the URNG and the National Reconciliation Commission in Guatemala will lead to a peaceful resolution of the civil conflict there. We welcome the establishment of representative, democratic government in Panama following US intervention there.

The noble Baroness, Lady Ewart-Biggs, and my noble friend Lady Gardner of Parkes raised the question of children. Perhaps this is the opportune moment to say a few words on that subject, particularly in relation to Guatemala. We hope that the new president elected in January will produce a fresh initiative in the struggle to uphold basic human rights not only for children but also for others in that area.

The past year has famously been one of democratic revolution in Eastern Europe. Less dramatic but in its own way just as significant has been the process of democratic confirmation and renewal in large parts of Latin America. I am sure that many noble Lords will wish to join me in repeating the Government's congratulations to President Collor of Brazil, President Gaviria of Colombia, President Calderon of Costa Rica, President Callejas of Honduras and President Fujimori of Peru on their election victories and smooth assumption of office from their predecessors according to established constitutional processes.

We were delighted to welcome the then President-elect Collor to London earlier this year and look forward to strengthening this country's already good relations with Brazil. The noble Lord, Lord Chorley, spoke with great knowledge of that lovely country. I agree with him that we cannot dictate solutions to others. That is why we are working closely with the Brazilian authorities to help preserve the global environment through conservation of the Amazon rain forest.

I am grateful for what my noble friend said about my right honourable friend Mr. Patten. My right honourable friend Mrs. Chalker has followed up his good work in her visit to that country in October this year. We salute the courage of President Gaviria and the Colombian people in carrying through the elections and upholding the democratic process in the face of murderous attempts at intimidation by the drug cartels. We shall continue to do all we can to help the Colombian Government in their attempts to curb narco-traffic. We are delighted to welcome ex-President Barco to London as a most distinguished ambassador to the Court of St. James.

The year 1990 has also seen significant progress towards regional co-operation and integration within Latin America. In the southern cone, Uruguay and Paraguay are reportedly exploring the scope for free trade with their much larger neighbours, whose plans for the Argentine-Brazil free trade zone are already under way. The Rio Group has recently been enlarged by the admission of Chile, Ecuador, Bolivia and Paraguay so that it now embraces all the Latin countries of South America plus Mexico. We wish Mexico and the US success in their negotiations for a free trade agreement.

I turn now to Cuba, which was mentioned in particular by the noble Lord, Lord Walston. It is sad that in a world which is increasingly turning to democracy and personal freedom Castro has set his face firmly against any change. I do not seek to deny Cuban achievements in the fields of health and education, but even those are at risk following 30 years of communist rule which have left the country in a state of penury. I hope that the Cuban Government will take the advice of my noble friend Lord Selsdon and come to recognise the way the world tide is flowing and decide to move with it.

The strongest British contribution to the economic well-being of Latin America has traditionally been through private investment. Consolidation of good government in the region can only reinforce that trend. Accurate figures of investment are difficult to produce, but we probably have a net £10 billion invested in the region. We are the second largest foreign investor in several countries, including Mexico, where we warmly welcomed President Salinas's sponsorship of a major inward British investment mission this summer.

The other engine of economic growth is of course trade. We much regret that recent multilateral efforts further to liberalise international trade have not yet borne fruit. However, I can reassure my noble friends Lord Montgomery and Lord Radnor that we shall continue to work for a successful outcome to the GATT round. We are confident that the European single market will provide wider and better opportunities for international trade, from which Latin America will also be a beneficiary.

British exports to Latin America in the first 10 months of this year were £995 million, a 21 per cent. increase on the previous year. Our imports from the region for the same period were £1.43 billion, almost the same as in the previous year. The British Government's most direct contribution to economic development in Latin America is through our own modest but well focused bilateral aid programme, which we expect will increase in the coming years.

We also make a substantial contribution to the large and growing economic co-operation programmes of the European Community, which has a well established political dialogue and economic co-operation programme with Central America which we are resolved to build on. Community programmes are also being concluded and expanded with several South American countries, and the UK is glad to play its full part in the establishment of a new political dialogue between the Community and its member states and the member states of the newly-expanded Rio Group. The two sides are to meet at ministerial level for the first time in Rome tomorrow, 20th December.

Hand in hand with that programme are our diplomatic missions abroad. The noble Lord, Lord Greenhill of Harrow, asked particularly about staffing. We are constantly adjusting deployments worldwide in response to changing demands. There is no doubt of our continuing commitment to Latin America. Following the re-opening of our embassy in Buenos Aires there are embassies or high commissions with UK-based resident staff in Mexico and in every independent country in Central and South America except Surinam.

My noble friend Lord Montgomery suggested that it would be a good idea to hold a conference on Latin America in 1992. I note that imaginative suggestion and will ensure that it is considered carefully by my right honourable friend and honourable friends. My noble friend said that it would be a good idea for it to coincide with the 500th anniversary of the encounter between the old world and the new world. We now know that contact was made much earlier than 1492. Indeed, I am proud that my ancestor Prince Henry Sinclair visited the new world in 1398, but he was certainly not the first to do so.

My noble friend Lord Selsdon asked about forthcoming ministerial visits. He is right to say, as did other noble Lords, that unless visits are made to those countries it is very difficult to pursue the good bilateral relationships that we all want. I recall that Lord Grey, when he was Foreign Secretary for 11 years earlier this century, made only two overseas visits. That is in marked contrast to what Ministers do now. I can assure the House that my honourable friend the Minister of State will be revisiting the region in the coming months. He visited Argentina and Chile in October. My right honourable friend Mrs. Chalker visited Brazil, also in October. I was particularly grateful for the remarks of my noble friend Lady Gardner of Parkes about my right honourable friend's ability to speak the language and his contribution through his personal connection.

All of those dynamic developments—national, intra-regional and inter-regional—have been complemented by the US Enterprise for the Americas Initiative and Partnership for Democracy and Development in Central America, launched last month in Washington, both of which we have welcomed as further practical evidence of the support of the international community for the efforts of Latin Americans to build a secure and prosperous future. Much groundwork has recently been laid and I am sure I hat noble Lords will join me in wishing all success to the democratic governments and people of Latin America as they embark on the arduous tasks which remain.

5.30 p.m.

Viscount Montgomery of Alamein

My Lords, many noble Lords have been kind enough to make remarks about my efforts and I am indeed grateful to them. But the debt is entirely the other way round. I am grateful to all noble Lords who have spoken in this debate. As my noble friend Lord Caithness pointed out, it has been a wide-ranging and varied debate covering almost every conceivable aspect of Latin American affairs. That is very welcome. Like other noble Lords, I enjoyed in particular the maiden speech of my noble friend Lord Aldenham. As has been said, it was thoughtful and sensitive. It is gratifying to feel that, even though we may have to wait 19 years for another debate on this subject—I hope that we shall not—at least he will be here (he is young enough) to carry on the good work when I and others might have gone elsewhere.

I welcome very much the remarks made by my noble friend Lord Caithness. I spoke on this subject last month and welcomed his conversion to the Latin American cause. I can see that that seed is bearing good fruit very rapidly. I hope that we shall hear frequently from him on this topic. I am glad that he likes the idea of a major conference to take place in 1992. There is now good reason to have yet a further conference—continuing the 1492 theme, although he questioned the veracity of the date—in 1998, which will be the 600th anniversary of his ancestor's excursion to that continent. Thus we can have two bites of the cherry. I hope that I shall still he around when he is present at that conference.

Diplomatic relations are vital. We have heard today about the restoration of diplomatic relations with Argentina. That was long overdue and extremely welcome. I should like to join other noble Lords in congratulating the Government on the brilliance of the recent fisheries agreement, which represents a great diplomatic achievement of considerable skill.

I am glad to hear that Latin America plays an important part in Foreign Office thoughts, although the noble Lord, Lord Greenhill, said that Latin America tended to be at the bottom of the heap when economies are made. Going round Latin America, as I frequently do, I find that staff is continually being cut down. I feel that at this time of great opportunity we do not need fewer diplomats; we need more of them, particularly in the commercial areas. It is all too easy to have commercial support in North America and elsewhere where things are relatively simple. But in Latin America, where matters are complicated, we need to have strong commercial support. I hope that it will continue.

We have had a wide-ranging debate. Every aspect of this matter has been considered. I hope that it will not be too long before we can return to it. Much food for thought lies in the Official Report and I shall look forward to reading it and participating in debate with noble Lords on these subjects on other occasions. I thank everyone who has taken part. I beg leave to withdraw the Motion.

Motion for Papers, by leave, withdrawn.