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Volume 984: debated on Monday 12 May 1980

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asked the Secretary of State for Trade, what is the United Kingdom's likely balance of trade with the Union of Soviet Socialist Republics over the next 12 months.

In the 12 months ended March 1980, the crude deficit on trade with the Soviet Union was £418 million. The development of trade over the next 12 months depends on commercial and other factors which I am not in a position to forecast.

When the Minister referred to "other factors" was he referring to the treatment of minorities by the Soviet Union, and to cases such as the awful tragedy of the Swedish diplomat, Raoul Wallenberg, who disappeared? For the last 17 years the Soviets have refused to speak about him or reveal his whereabouts.

The hon. and learned Member has earned himself the reputation of being "the scourge of the Soviets". On this occasion I join him in deploring this appalling incident. As long as the Russians continue to persecute their minorities, as they have, they will continue to have criticism heaped upon them which they deserve.

Does the pound sterling float against the rouble? If not, how is its value determined?

I would have welcomed notice of that question. If the right hon. Gentleman puts it on the Order Paper I shall make arrangements to answer it.

Will my hon. Friend confirm that the imbalance of trade between this country and Russia has been consistently to the advantage of the Russians? Are there not good political and economic reasons why that imbalance should be reduced, if not eliminated?

The crude trade figures are a little misleading. About 80 per cent. of our imports from the Soviet Union are of raw materials and a substantial proportion of those are subsequently re-exported by us at a profit. It would probably damage us more than the Soviet Union if we were to act as my hon. Friend suggests.

Would it not help our trade deficit, crude and otherwise, if manufactured goods from the Soviet Union bore the clear mark of their country of origin? Is the Minister aware that I have recently written to his right hon. Friends the Prime Minister and the Minister for Consumer Affairs drawing attention to Russian-produced greeting and Christmas cards which are dumped in this country to the severe disadvantage of a firm in my constituency?

We are helping the printing industry to mount an anti-dumping action in this case In fact a couple of weeks ago I wrote to the industry and urged it to get a move on and produce evidence. I offered the services of the Government. We are also looking at the question of origin marking of those cards.

Safety Of Life At Sea Convention


asked the Secretary of State for Trade when he expects the requirements of the Safety of Life at Sea Convention to come into force.

The International Convention for the Safety of Life at Sea 1974 will enter into force on 25 May, and represents an important step forward in our continuing endeavours, nationally and internationally, to promote maritime safety.

Is my hon. Friend aware of the risks which communities such as Canvey Island, with its heavy concentration of high risk industry on the waterfront, face from unsafe vessels carrying hazardous cargoes and from bad navigation practices? Is he aware of our anxiety about delays in fully implementing conventions of this kind? By what date can we be completely assured of the banning of tankers, not fitted with inert gas systems, from ports such as London?

I could hardly be unaware of the anxieties about Canvey Island while my hon. Friend is a Member of this House. He constantly brings them to my attention. I said on 24 April that we will introduce the convention on inert gas system requirements for foreign ships earlier than would be required by the 1974 convention. I assure him that we are taking a lead in introducing requirements for the special qualification for the masters and officers of such vessels because of the very dangers to which he draws our attention.

Is the hon. Gentleman aware that his answers on both counts are satisfactory to the Opposition? Is he also aware that about one-third of total losses relate to ships that are less than 10 years old? Can he give us some indication of the timetable that he envisages for the ratification and coming into effect of the convention on training, certification and watch-keeping? There is deep concern about inadequate international standards of management and crewing.

That will not be an easy matter, but, in line with the conventions, the United Kingdom will be introducing new certification requirements in 1981 and I hope that other countries will rapidly follow our example. I am encouraged by the fact that these measures have the support of both sides of the House.



asked the Secretary of State for Trade how many United Kingdom firms have won contracts with Iran in fair and open competition with firms in all parts of the world; how many of those firms would be affected if Her Majesty's Government decided to apply econnomic sanctions against Iran; and how many workers he estimates would lose their jobs as a result of such sanctions being implemented.

The effort of sanctions would depend on their precise scope and on the extent to which exports to Iran can be diverted to other markets.

Is the Minister aware that President Carter has lifted the ban on the export of United States-produced wheat to the Soviet Union? Is he also aware that if we apply sanctions against Iran it is possible that American firms will be waiting to jump in and capture our markets?

The hon. Gentleman's concern is unnecessary, because we shall be moving in concert with the Americans on sanctions against Iran. Any trade banned to us will certainly be banned to them.

My hon. Friend is well aware that we are taking sanctions to help the United States—

Order. The hon. Gentleman must put his remarks in the form of a question.

Is my hon. Friend aware that we are taking sanctions to help the United States and that today the Americans have said that they intend to impose sanctions against 30 British products? Will those products be excluded from our list of products on which the sanctions against Iran are to be imposed?

I think that my hon. Friend is confusing two separate issues. One is the American retaliation as a result of our action against their synthetic fibres. The other is the question of possible sanctions against Iran. The House has to discuss later today the enabling measure for sanctions and perhaps that will be a more sensible occasion on which to deal with such details.

Does not the Minister thing it a piece of effrontery on the part of the Government to introduce sanctions, since those who carried on illegal trading with Rhodesia were not only not prosecuted but were relieved of all fears that they would ever be prosecuted? In view of that, are not the proposed sanctions on Iran a complete charade?

I never thought that I would live to see the day when the right hon. Gentleman became a mere echo of the hon. Member for West Lothian (Mr. Dalyell), who raised that point in the House last week.

Air Traffic Control Radar Systems


asked the Secretary of State for Trade whether a decision has been made on the acquisition of a new radar for the Civil Aviation Authority; and if he will make a statement.


asked the Secretary of State for Trade when he now expects the Civil Aviation Authority to come to a decision on the purchase of a new radar system for air traffic control.

The Civil Aviation Authority announced its decision on 2 May 1980. The CAA radar replacement scheme is expected to cost some £24·5 million and Cossor Marconi from Britain, and HSA of the Netherlands have won significant electronic contracts whilst AEG Telefunken will provide aerials and turning gear. More than half of the value of the whole project will be spent in the United Kingdom, including, I expect, half of the HSA contract.

Can my hon. Friend confirm that the American firm Westinghouse which was, at one time, boasting that it had the contract sewn up, was eliminated from the competition because its offer was found to be seriously misleading? If that is so, will he make sure that those facts are known to every other British authority that may be contemplating a purchase from that company?

My hon. Friend is right to say that Westinghouse appeared at one time to be the front runner for the contract, but on closer examination it was found that the capabilities of the equipment on offer fell far short of the claims of the company's salesmen and produced a lower performance than the equipment offered by HSA, which was also offered at a lower price. I am sure that the lesson will be learnt by other prospective customers.

Is the hon. Gentleman aware that the CAA decision will cause much disappointment to the Marconi-Plessey group? Can he confirm that the price quoted by that group was competitive against that of Hollandse Signaal and that the group's specification for the equipment was just what the CAA required?

I should prefer not to go into the details of pricing and specifications, not least because it would not be in the best interests of any of the contenders concerned. The prime reason why the contract went abroad was that the CAA was not able to convince itself that British equipment could be delivered on time. I hope that those who are engaged in supporting the buffoonery in industry that is proposed for Wednesday will remember that such idiocy can only damage the chances of British industry.

Does my hon. Friend not find it rather sad that no British company can strike a deal with the CAA on the radar replacement? Does not that perhaps call for an overhaul of the working arrangements between the CAA and industry?

I am sure that the arrangements can be improved, but it is not true to say that the CAA has not been able to buy from British industry. Cossor and Marconi are extensive suppliers. Equally, if one were a Dutchman, one might think it a pity that Marconi gets the contracts for communications equipment for the Dutch Navy and that Ferranti gets the contracts for their airborne radar.

Is not the hon. Gentleman's suggestion that the workers involved in British industry carry the responsibility for the fact that the contract did not go to a British company entirely disgraceful? Is not the idiocv of the Government in dismantling British industry and putting more and more people out of work the cardinal sin being committed in this country?

I am not blaming the loss of the contract with the CAA on events that have not yet taken place, but at a time when the prime criticism of our exports is that they are not delivered on time, I regard it as a combination of Luddism, idiocy and buffoonery further to delay British industry in support of an idiotic political gesture on Wednesday.

Will the Minister have a care in his remarks, because he indicated in the body of his main reply that a substantial amount of the equipment and labour concerned will be provided from the United Kingdom and, in particular, from my constituency?

I am delighted that that is so and I hope that the hon. Gentleman will advise the workers in his constituency that it is in their best interests to keep at work and to make sure that the equipment is delivered on time.



asked the Secretary of State for Trade if he will take action to ensure that in practice United Kingdom exports to Japan are treated no less favourably than Japanese exports to the United Kingdom.

We will continue to press, directly and through the European Commission, for removal of obstacles which concern British exporters and for the further opening up of the Japanese market to United Kingdom exports.

Since the trade gap between Britain and Japan continues to widen, so that the Japanese are exporting to us more than £2 of goods for every £1 worth that we send to them, and since exhortation of the sort that the Secretary of State tried in Tokyo in January appears no longer to be working, is it not time for the Government to get tough with the Japanese and to impose countervailing duties and non-tariff barriers until the Japanese start to play fair in world trade markets?

I cannot agree with the hon. Gentleman's diagnosis of the situation. Our exports to Japan are not growing as quickly as we should like, though they amount to more than £600 million and are not to be written off lightly. In addition to exhortation, we have arrangements which, in one way or another, already control more than one-third of Japan's exports to this country.

Will my hon. Friend confirm that the Japanese car industry voluntarily limited exports of cars to this country and that those who took advantage were Continental manufacturers rather than British manufacturers? Will he confirm that many of the restrictions and regulations applying to goods imported into Japan apply equally to domestically produced goods?

I agree with the first and second parts of my hon. Friend's question. He is right. In the last three months of 1978, when the Japanese sent in no cars, the net result was that the British share of the market remained absolutely static and that German, French and Italian cars took up the strain. If that happened, Opposition Members would immediately start complaining about the increase in our deficit with the EEC.

Monopolies Commission (Referrals Policy)


asked the Secretary of State for Trade whether he will make a statement of policy guidelines for referral of bids to the Monopolies Commission; and if he is satisfied with the manner and timing in which these referrals are announced.

My right hon. Friend refers a bid where, in the light of the Director General's advice, he considers that the public interest issues involved are sufficient to merit doing so. His decision is published as early as practicable in the course of the bid, and he has no plans at present to alter this procedure.

I am disappointed with my right hon. Friends reply in view of the long delay that took place in the Armitage Shanks—Blue Circle bid earlier this year. This resulted in over a month's delay in opportunities to take the matter further and, therefore, a long, protracted period of uncertainty for management, workers and investors. Does not my right hon. Friend agree that the matter should be speeded up in the interests of everyone concerned?

I am sorry that my hon. Friend is disappointed. As he will be aware, my right hon. Friend is required by the Act to make a determination as soon as practicable. His usual aim is to announce a decision before the first closing date of the final bid offer, as this is a reasonable target which has wide support in the financial community. However, fresh developments may arise during a period when the offer is open. In such cases, it is not normally practicable to reach a final decision any earlier, as in the case of Blue Circle-Armitage Shanks. Both the Department and the Office of Fair Trading make every effort to announce decisions on a merger by the first closing date.

Anti-Dumping Procedures


asked the Secretary of State for Trade whether he will take new initiatives on anti-dumping.

The existing antidumping procedures provide an adequate framework for dealing with well-founded complaints of dumping. The European Commission is well aware of my concern that speedy and effective action must be taken to protect industry when dumping is causing injury. The Department of Trade retains an anti-dumping unit to help British industry in preparing complaints.

Does the Minister recall that the balance of trade deficit in textile goods for 1979 was nearly £700 million and that it is currently running at a higher rate? This is caused partly through dumping of cheap imports and is also a contributory factor to the massive number of jobs being lost in the textile industry. Is not the hon. Gentleman standing truth on its head when he says that the position is satisfactory? Is not the truth that the EEC is slow and unwieldy, and it appears to be totally indifferent to the needs of the British textile industry?

I am afraid that I cannot accept what the hon. Gentleman says. The procedures exist. They are there to be used. The industry is often much better at making allegations than establishing them with facts. We retain the anti-dumping unit precisely to help British industry prepare its cases. Where there is a well-founded case, we get action.

Is my hon. Friend satisfied that procedures are working adequately with regard to alleged dumping from behind the Iron Curtain? It is difficult to get evidence of the genuine cost structure of the home market within those countries.

I agree with my hon. Friend. That is why there is a wide range of goods subject to quota and control in trade with Iron Curtain countries. In those agreements, there is a price clause—aptly named considering who asked the supplementary question—that allows us to take action on grounds other than dumping grounds. We have, therefore, two opportunities. We have dumping and the price clause mechanism. We have used the price clause, for example, on Romanian suits.

Following the imposition by this country of generous quotas on United States exports of yarn to this country a few weeks ago, will the Minister confirm that the United States Government are threatening to impose further restrictions on exports of woollen textile products from this country to that country? As the West Yorkshire wool textile industry sees virtually no benefit from the quotas on yarn imports, will the Minister assure the wool textile industry that he will reject totally such measures? Will he have consultations with the industry urgently with a view to presenting a full case?

I do not know whether the hon. Gentleman saw the reported remark by an American official, who described American action on wool textiles, were it to be taken, as the equivalent of shooting oneself in the foot. In other words, we think that action on wool textiles would be a totally futile gesture. There are negotiations going on between the EEC and the Americans about compensation for our action under article 19 on polyester filament yarn. We shall do what we can to make sure that this does not apply to wool textiles.

Is my hon. Friend aware that the protectionism advocated by Opposition Members, which goes well beyond anti-dumping restrictions will lead to much higher prices for the consumer in this country—a matter to which Opposition Members do not often refer?

That point is not made as often as it ought to be made. It is interesting that the Consumers Association and the Retail Consortium have started forcefully to make this point. It should be taken into account in discussion on import controls.