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Ussr (United Kingdom Exports)

Volume 15: debated on Monday 14 December 1981

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14.

asked the Secretary of State for Trade what recent initiatives he has taken to encourage exports to the Union of Soviet Socialist Republics.

A number of initiatives discussed at the May 1981 meeting of the British-Soviet Joint Commission are being pursued, including co-operation in the energy and automotive sectors.

I commend those initiatives. Will my right hon. Friend confirm that trade between the two countries has consistently been at an imbalance of 2:1 in Russia's favour for about 20 years? A significant reason is that it is in our interests to re-export some Russian imports, but does my right hon. Friend agree that the time has come when we can say to the Russian Government, with legitimate concern, that if they do not take more of our exports, particularly machinery and goods. we have the right to review imports of what we regard as inessential goods, including, though not exclusively, vodka and caviar?

Leaving out the movement of diamonds, which benefits British firms, the trade balance is not too adverse to us. For example, we have a considerable surplus of trade in manufactured products. We are not significantly dependent on Soviet imports, except diamonds and precious stones. Our imports from the Soviet Union largely comprise raw materials, such as oil products and timber, and any replacement of those supplies would certainly take place at a higher cost to the economy and the consumer.

Can my right hon. Friend assure the House that the Government are being exceedingly cautious about trade with the Soviet Union at present, particularly on high-technology items that could improve the Soviet Union's military potential? Can she also confirm that if the Soviet Union sent even one man across the Polish border trade with the Soviet Union would be terminated?

We trust that Poland will be left to settle its own affairs without interference from any quarter. I cannot speculate on how the United Kingdom and other Western countries would react if the Soviet Union intervened. We very much hope that it will not do so. It is clear that Soviet intervention would have far-reaching consequences for our relations in every sphere. In line with the policy agreed after the invasion of Afghanistan, the United Kingdom is not processing export licence cases that would require the unanimous approval of our COCOM partners. There are limited exemptions to that policy; for example, equipment intended for medical use only.

Apart from what the right hon. Lady has already said, does any aspect of Russian foreign policy or Russia's denial of civil rights have any effect on trade policy?

The hon. Gentleman will be aware that the Government have made abundantly clear their view about the Soviet Union's appalling—I repeat appalling—human rights record, but I believe that trade that is genuinely to our mutual advantage should continue.

Can my right hon. Friend assure the House that the Government will not provide export credits to the Soviet Union for vast sums at massively subsidised rates, as did the previous Government, much to the detriment of the United Kingdom?

I can give my hon. Friend that assurance. We offer credit to the Soviet Union on the same terms as those offered by other OECD countries. There would be no sense in offering either worse or better terms or discriminating in favour of the Soviet Union. The agreement that ended in February 1980 is not to be renewed.