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Ussr (Credit Agreement)

Volume 928: debated on Thursday 17 March 1977

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asked the Prime Minister if he is satisfied with the co-ordination between the Department of Trade and the Foreign and Commonwealth Office in relation to the Government's £1,000 million loan to the Government of the USSR; and if he will make a statement.

There is no such loan. If, as I assume, the hon. Member is referring to the credit agreement between this country and the Soviet Union, the answer is "Yes".

Can the Prime Minister deny that Labour's wonderful credit agreement with the Soviet Government is so marvellous from the Soviet point of view that not only will not one penny of profit accrue to Britain but the British taxpayer will be called upon to finance approximately 50 per cent. of the total production costs of anything that the Soviets choose to purchase under that agreement?

I should like to look at the arithmetic, because I am not able to give an answer offhand. It is certainly the case that £188 million has been taken up by the Soviet Union, and this has created jobs in this country, perhaps including some of the hon. Gentleman's constituents at Trafford Park. There is every reason why we should continue to make advantageous bargains of this sort in the same way that our industrial competitors do. The hon. Gentleman should know—if he does not, allow me to inform him and the House—that France, Japan and Italy, to name but three other countries, have made agreements similar to those that we have made with the Soviet Union. It would be foolish to cut ourselves off from that trade.

Will my right hon. Friend explain why Conservative Members are so anxious to discourage trade with the Soviet Union, in marked contrast to their friends in private industry and business who, in their scramble to buy diamonds, furs, timber, and especially oil, from the Soviet Union, have caused a balance of trade with the Soviet Union that is in the Soviet Union's favour to the tune of £400 million a year?

It is noteworthy that while we do buy a lot of the products to which my hon. Friend has referred, France, the Federal Republic of Germany and the United States not only buy much more but sell much more. It would be valuable if at some time the Opposition would tell us whether or not they want to go on trading with the Soviet Union.

Will the Prime Minister assure us, after investigation, that these British credits to the Soviet Union are not used for the purchase of Rhodesian tobacco by some of the satellite countries?

As far as I know, they are not. These are arrangements that are made, for example, with firms like Rolls-Royce for the export of industrial goods from this country. That is why they are not only bringing employment but are helping us with our balance of payments with the Soviet Union.