HC Deb 03 February 1976 vol 904 c541W
Mr. Hooley

asked the Secretary of State for Trade what is the policy of Her Majesty's Government with regard to proposals by developing countries for some form of indexation or link between the prices of their raw material exports and their imports and manufactures.

Mr. Deakins

We agree that these proposals require careful study to determine how far they would work to the benefit of developing countries generally and what effects they would have in relation to our objective of promoting a better organisation of commodity trade.

Mr. Spearing

asked the Secretary of State for Trade if he will state his reasons for favouring a policy of case by case approach to commodity regulations with third world nations; and what is his view of proposals to index raw material prices to those of manufactured goods.

Mr. Deakins

Each individual commodity has a different production cycle, a different elasticity of demand, different storage problems and specific characteristics which have to be taken into account in any attempt to deal with the problem of price fluctuations. None the less, as my right hon. Friend the Prime Minister indicated at the Commonwealth Heads of Government meeting in Jamaica in May 1975, it is possible to envisage a framework of internationally-agreed commitments within the context of a general agreement on commodities.

As regards indexation, I would refer my hon. Friend to my reply today to my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley).