§ Q107. Mr. LathamTo ask the Prime Minister if she will make a statement on the proposals made by Her Majesty's Government to the European Community calling for increased aid and investment in eastern European countries seeking to introduce democracy and a freer market economy; and what progress is being made in that regard.
§ The Prime MinisterThe Government are committed to supporting economic and political reform in eastern Europe, and have played a leading role in encouraging the very positive response of the EC and its member states to the emerging democracies. Nationally, the United Kingdom was first in the field with a know-how fund for Poland, now valued at £50 million. On 29 November, we announced that we would be contributing £15 million to an agriculture project in Poland and that we would make a contribution of $100 million to the stabilisation fund for Poland. For Hungary, a know-how fund, valued at £25 million, will come into operation early next year.
145WWithin the Community we have contributed to a comprehensive assistance package for Poland and Hungary comprising:
some £210 million for aid projects for both Poland and Hungary in 1990;GSP status, bringing reductions in tariffs and levies on industrial and certain agricultural products;suspension or abolition of quantitative trade restrictions; eligibility for EIB lending.In addition, the Community has provided £70 million-worth of free food for Poland. We expect to announce soon a further contribution.
Moreover, the EC is establishing a pattern of agreements with the countries of eastern Europe which will encourage trade and investment.
Her Majesty's Government will continue their strong support of the EC's policy of differentiation in favour of those countries which introduce reforms leading to democracy and a free-market economy.