§ Mr. Gouldasked the Chancellor of the Exchequer what has been the improvement in the terms of trade for each SITC division and sub-division of manufactures (a) since 1970 and what has been the consequent increase in exports as a percentage of imports and (b) for the latest three months; how much of this was due to the revaluation of the £ sterling; and what has been the consequent increase in exports as a percentage of imports.
§ Mr. Robert SheldonThe change in the ratio of the value of exports to the value of imports consequent on a change in the terms of trade index depends on a642W reverting to the pre-1949 position, by making national insurance contribution tax-allowable, and at the same time making all income, from whatever source, liable to tax.
§ Mr. Robert SheldonI regret that the information on which to base an estimate is not available.
§ Mr. Ralph Howellasked the Chancellor of the Exchequer if he will publish a table showing in which other EEC member States national insurance contribution is not tax-allowable.
§ Mr. Robert SheldonOn the assumption that the hon. Member has in mind contributions paid by employees, the position in the nine member States of the EEC is, so far as I am aware, as follows:
number of factors. In particular the volume of both exports and imports is likely to change with changes in relative prices, but this will occur only after a lag. In addition the volumes of imports and exports will alter with changes in demand at home and abroad. It is, therefore, not possible to make reliable estimates of the change in the ratio of the value of exports to the value of imports that can be attributed to the change in the terms of trade or to other factors—such as the exchange rate—which tend to bring about the change in the terms of trade.
The table below contains the available information for the last six months on 643W terms of trade for components of manufactures on an overseas trade statistics basis—i.e., exports valued f.o.b. and imports c.i.f. Figures for other SITC
TERMS OF TRADE FOR MANUFACTURES 1970=100 S.I.T.C.(R) Terms of Trade* Description Section or Division December 1976-February 1977 March-May 1977 Chemicals … 5 90 92 Chemicals elements and compounds … 51 98 103 Plastic materials … 58 103 104 Manufactured goods classified chiefly by material … 6 103 101 Textiles … 65 99 101 Iron and steel … 67 106 101 Machinery and transport equipment … 7 109 110 Non-electric machinery … 71 113 116 Electric machinery … 72 118 116 Miscellaneous manufactured articles … 8 82 83 Clothing and footwear … 84 and 85 75 76 Instruments … 86 78 81 * Export unit value index (f.o.b.) as a percentage of the import unit value index (c.i.f.). Source: Tables F2 to F5 of the June issue of "Monthly Review of External Trade Statistics".