Mr. Ted Fletcher
asked the Prime Minister to what extent and in what precise respects the Government propose to implement the Brandt recommendations in the immediate future.
§ The Prime Minister
The following is a list of Government activity in fields covered by the Brandt report, arranged under the four headings of the "Emergency Programme".
A. Transfer of Resources
- (i) The Government support a major role for the IMF in providing finance for developing countries in deficit, promoting adjustment and helping countries to attract private finance. We have argued for increased access to the IMF by countries in need and for extra sources of finance for larger drawings.
- (ii) The Government are participating in an arrangement announced in May 1981, whereby the central banks of 13 OECD countries will make available a further £1.1 billion to the IMF.
- (iii) We have agreed to the doubling of the World Bank's capital and support its programme of structural adjustment lending and increased co-financing.
- (iv) We are participating in international support operations for countries in financial difficulty, eg. for Turkey, and in joint debt rescheduling, eg. for the Sudan. For 17 of the poorest countries Britain has already converted aid loans to grants or provided equivalent help worth some £900 million over the next 20 years.
- (v) We have taken legislative authority to participate in the latest Replenishment of the International Development Association (iDA) and hope all the others concerned will do the same.
- (vi) The Government and their Community partners agreed at the UN Conference on the Least Developed Countries in Paris in September to aim to allocate 0.15 per cent. of GNP as aid to the Least Developed.
- (i) The Government are taking measures to save energy at home and to develop alternative sources of oil especially coal and nuclear power. Other Western countries are doing the same.
- (ii) We support measures to enable non-oil developing countries build up their indigenous energy resources. We are helping through bilateral aid programmes and by backing the efforts of the World Bank.
- (iii) We are looking for ways to achieve a dialogue with the oil producing countries to assure more reliable supplies of oil at more predictable prices.
- (iv) We support the establishment of an energy affiliate, provided that this will attract additional finance for energy investment, especially from OPEC surplus countries.
- (i) The Government wish to see individual developing countries give increased priority to food and agricultural production in their investments. We shall respond within their ability to the agricultural priorities of aid recipients. We shall encourage international bodies to do likewise.
- (ii) We support the early conclusion of the Wheat Trade Convention and have agreed to the extension of the present Convention until 30 June 1983.
- (iii) We are associated with the European Community contribution to the new Food Aid Convention negotiated for the period up to 30 June 1981 and now extended for a further two years. We consider that the objective of food aid should be the intensification of development—particularly in the agricultural sector with a view to reducing the risk of sudden emergencies. However the Government also agree that the Community should contribute to the International emergency food reserve through its annual allocation under the Food Aid Convention.
- (iv) The Government have supported the establishment of a new Cereals Facility within the IMF to assist countries suffering exceptionally high cereal import costs.
- (v) With our Community partners we agreed in November 1981 to an additional package of food aid to the Least Developed worth £23 million.
D. Reform of the Economic System
- (i) The Government support the adaption of the IMF and World Bank to changing needs while preserving their basic structure.
- (ii) As a member of the European Community the Government are promoting the steady liberalisation of world trade by means of the Lomé Convention, the Generalised Scheme of Preferences and through full implementation of the recent GATT agreements.
- (iii) We welcome the creation of a Common Fund for commodities and have already announced a voluntary pledge of £4.3 million to the Second Account. The legislation required for ratification is now before Parliament.