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Mr. Jeremy Corbyn (Islington, North) : My hon. Friend is dealing with a very important subject when he mentions the World bank and its policies. Will he reflect on the lack of democracy in the make-up of the World Bank's

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board and its decision-making process and on the way in which it tranfers a large amount of wealth from the poorest countries to the richest ?

Mr. Worthington : I am not in the least grateful for that point because it would lead me, in the concluding part of my speech, right up another avenue that I do not want to explore at present, because I want to concentrate on what I am saying now. But the openness and accountability of the World bank are legitimate concerns. Perhaps one of the reasons why we found out about the Pergau dam was that here we have instruments such as the National Audit Office and the Public Accounts Committee to find out these things. The problem with the World bank is that if similar events were occurring in its business we would have no mechanism with which to find out.

Our aid budget has fallen and is still falling. It has gone from 0.51 per cent. of gross national product in 1979 to a figure that we do not now know. We do not know it because the Government are fiddling the aid figures in the same way as they fiddled the unemployment figures. They have put the traditional overseas development budget in with central and eastern Europe, and they will not now tell us the figure for our aid budget.

The tragedy of the Pergau dam affair is that the relatively poor people of the world are being shrunk out of the aid budget by considerations other than their particular needs. The needs that have been met have been those of the Government to stimulate the arms trade, in the case of the Pergau dam. Who can now doubt that the reason why the Pergau dam went ahead was that, alongside it, in parallel and entangled with it, was the need to procure very large arms orders for this country ?

That is that is wrong about this, and it is why I congratulate the Liberal Democrats on raising the issue in this debate.

6.18 pm

Mr. Den Dover (Chorley) : As a civil engineer, and one who was responsible for overseas work in Iran--the joint venture of Laing and Wimpey in 1975-77--and as unpaid parliamentary adviser to the Export Group for Construction Industries for the past 12 years, I express my interest, but I have no paid interest to declare. So here are my own thoughts and comments on tonight's debate, a debate which shows a lack of appreciation on the Opposition Benches of how business is done in overseas territories.

I am delighted that my right hon. Friend the Member for Mid-Sussex (Mr. Renton) pointed out the need to pay people in those territories for introducing work. Would any Opposition Member not pay an estate agent for finding somebody to buy his or her house ? We have agreed reasonable operating fees in overseas markets and we need to grab the work, in fierce competition with our overseas competitors such as Germany, France and Holland.

It is alleged that the Malaysian Pergau dam project has received some grant. If it has not, there is no onus on Malaysia to repay that in terms of a defence contract. All that we have given are soft loans, which means a reduced interest rate on the repayments which the Malaysians must make for that project, as well as reduced export credit guarantee rates of cover. No money has been put into the project by the Government. We are simply giving reduced

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interest rates. Why is there, therefore, an onus on Malaysia to place defence contracts with British suppliers of armaments ?

Mr. Mans : Does my hon. Friend agree that there is clear evidence that there was no linkage ? The defence agreement reached with the Malaysian Government changed from an agreement to supply Tornados to an agreement to supply Hawk aircraft. If there had been a link, one would presume that it would have had a consequential effect on other projects such as the Pergau dam. There was no such effect, which is clear factual evidence that there is no such link.

Mr. Dover : I entirely agree that there was no such linkage. I welcome the Foreign Affairs Select Committee investigating this matter in great detail. I shall listen carefully to what is said there and look carefully at the record of the discussion and investigations.

The Pergau project is exactly what the Malaysian Government wanted. That fact is extremely important. The Sunday Times said that the project is no good as it is producing electricity for only a few hours a day. However, the dam is to meet peak demands and it can cost an enormous amount to build enormous power stations or gas turbines to fill that peak demand of electricity. It is far better to go along with a project that the Malaysians wanted and were willing to pay for over a long period.

The media also tried to show that the 12 or 14 years project is a long period. But it is on programme ; it is only a five-year programme ; and it is working within budgets.

Another point of correction is that, as my right hon. Friend the Minister pointed out, the aid-trade provision is only 5 per cent. of the Government's total overall aid budget. I welcome the fact that, under the aid-trade provision, jobs and the provision of equipment from the United Kingdom flows out to those countries ; they paid good hard currency for those exports, which results in jobs in the United Kingdom.

A lot of misrepresentation and misinformation about the project has been rife in the media. I am delighted to have this opportunity briefly to correct one or two points. We must press, in fierce competition, for such projects. We must do everything possible to get future Malaysian contracts back on the road, and I deplore the possibility of losing the international airport project because of stupid media hype, which has done the United Kingdom no good whatever.

6.23 pm

Mr. Derek Enright (Hemsworth) : Because of the comprehensive job that was done on the negative aspects of the motion by the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel), I need not dwell long on them, save to make a few comments about the remarks by the right hon. Member for Mid-Sussex (Mr. Renton) and, more recently, by the hon. Member for Chorley (Mr. Dover).

I have considerable practical experience of firms trading overseas and of overseas aid, which is why I was surprised that the hon. Member for Mid- Sussex got wrong the way in which the European budget works. If we are to affect the

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European budget--it is important that we do- -it is crucial that we understand the instruments properly before we start to criticise them.

On the question of currency, the Minister's speech on the Government's positive amendment to the motion was disappointing. He said what far- sighted chaps they were, looking forward to a fine future and concentrating on aid to the poorest, but not once did he mention sub-Saharan Africa or the Government's policies to be pursued there. Given that the Government amendment contains some important, positive aspects, that was the least that he could have done. It was a shame that his entire speech consisted of petty, party-political sniping when something important should have been discussed. To take up the comment by my hon. Friend the Member for Islington, North (Mr. Corbyn), we might have heard something about the World bank, for example. We are experiencing real problems with the relationship between the World bank, the International Monetary Fund and a variety of UN institutions, which need to be more integrated in their approach ; the Government should recognise that they are not operating in isolation. They should consider what policies their partners within the European Community and the United Nations are pursuing. As the hon. Member for Mid-Sussex mentioned the British Council, it might be worth looking at what the United Nations Educational, Scientific and Cultural Organisation is doing. I know from personal experience that it is doing some first-class work in basic linguistics, which would be assisted by co-operation with the British Council.

Given the Government's positive attitude, they might consider funding UNESCO again. It is important that they look at it afresh and see whether they can mingle with the British Council. We can be proud of what the British Council does and I pay testimony to the superb quality of its staff, but it is totally out-gunned by Germany and France, which put far more resources into such work and carry it out in many countries other than the ex-empire.

In Guinea-Bissau, for example, which my hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington) mentioned, the British Council regularly refused to do anything except pay an occasional visit because it did not have the resources, whereas similar institutions in Germany, France and Portugal were doing a considerable job. The aid that the United Kingdom gave to Guinea-Bissau during the three years in which I was there consisted of a set of football shirts. Although they were welcomed by the football team that received them, they did little for development. Guinea-Bissau is one of the poorest countries in Africa, yet it was given no money whatever.

My next point impinges slightly on the Malaysian issue and concerns the coal operation business and the effective use of money, particularly that spent on energy. If money is to be spent on energy, be it on a dam or whatever, it should be spent effectively, economically and in a sustainable way. I understand that, technically, that is not necessarily the case with Malaysia as the money could have been spent more economically, although the contract would then not have gone to the company to which it went. It is certainly true elsewhere that, when electricity generators are given, which admittedly produces jobs in this country, the power station can use that electricity generator for its quarter lifetime but it is then incapable, because they go to the poorest countries, of paying for the spare parts and repairs required. One has only to go round

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Africa looking at machinery there to see that it is disused, and for one simple reason--there is not sufficient hard currency to buy the spare parts.

I return to the problem of the World bank, the IMF and the United Nations and to the point made by the right hon. Member for Mid-Sussex about more money from the European development fund going to French countries than to others for the stabilisation of their currencies. That shows that the right hon. Gentleman does not understand that the French franc is used on the Co te d'Ivoire as a basis for the common currency, which is a semi-hard currency. If those who live out there cannot get a dollar or a pound they are very pleased to get francs CFA. The currency is backed by the French and provides a semi-hard native African currency with some purchasing power. The ability to continue to buy is crucial to some African countries. Not one of those problems was mentioned by the Minister.

At Question Time on Monday, I put some of the problems to the Minister. He had notice of my question, but ducked it completely. Currency in Africa is important for its survival and development and it is about time that a real effort was put into addressing the problem.

Turning from the World bank to financial development, the most successful lending projects in Africa, South America and, indeed, Indonesia, have come not from the World bank but from small credit lines. There are credit lines in Africa set up by African women and primed by European money, that have a rate of return which would be the envy of the greediest capitalist.

Those projects are doing something truly effective in agricultural production. They are renewing tools which do not necessarily come from Cheltenham or from the constituency of any other hon. Members who scream about the loss of jobs that will occur if we do not dump on other people unsustainable debts through selling them arms and other such large-scale projects. Those credit lines are producing the small developments which are crucial. That grass roots development should be sustained.

The hon. Gentleman talks about British people getting jobs directly because they make arms in Cheltenham. I invite the hon. Member for Cheltenham

Mr. Burns : Chelmsford.

Mr. Enright : I apologise for lumbering the hon. Member for Chelmsford (Mr. Burns) with Cheltenham. Even representing Chelmsford, the hon. Gentleman should visit my constituency in Hemsworth. He can come to Featherstone, South Emsell and South Kirby and see the pits that have been destroyed directly by the Government. The pits did not depend upon foreign trade, but were closed directly as a result of his vote.

The hon. Gentleman stands up and says that we do not want to lose jobs, having said that losing jobs in Hemsworth represented the harsh light of real economic facts, whatever they are. I will not accept the crocodile tears of Conservative Members until they have stopped the direct loss of jobs as a result of the Government's actions. I am delighted to see at least one Conservative Member who abstained on the vote on the miners.

Mr. Burns : With regard to the crocodile tears, I will not take any sanctimonious lectures from the hon. Gentleman.

Mr. Enright : I know that many hon. Members wish to speak. I look forward to the speech by the hon. Member for Chelmsford and I hope that he will give way to me.

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The right hon. Member for Mid-Sussex rightly said that bribery often occurs, but it is wrapped up. It is not called bribery ; it is called commission. That indeed happens. I do not see why we should call foreigners people who take bribes when we call Mark Thatcher and his partner people who take commission for performing exactly the same job of selling arms abroad. That simply will not do. I leave the Government with one thought, and the Minister for Trade has direct responsibility for this matter. The greatest thing that we can do for development in Mozambique, which was mentioned earlier, is to prevent the export of mines from Britain. Will the Minister ban the export of mines unilaterally ?

6.36 pm

Mr. Andrew Hargreaves (Birmingham, Hall Green) : I am grateful for the opportunity to contribute to the debate, not least because I have worked with three different financial institutions that have had extensive dealings over the years with Malaysia.

During today's debate and others, hon. Members have mentioned the Pergau dam. I should like to reiterate one point that Labour Members underestimate. There is a staggering intellectual, patronising arrogance when British civil servants or hon. Members tell the Malaysians that they have accepted a dam in the wrong place. If it is Malaysian policy to have a regional spread of such projects and they want energy provided in a certain area for regional development, as well as for the purely and strictly economic benefits that such a project may bring to that area, they are within their rights in standing their ground and saying that they want the dam in that particular spot and prefer it to another type of project elsewhere. When the British Government are criticised for having underwritten the financing of the dam, it is unjust to call it shabby or, as some Opposition Members have suggested, the corrupt use of the aid for trade provision.

"Aid for trade" should be exactly that. Some Conservative Members would disagree profoundly with Opposition Members about the whole nature of overseas aid. Some Conservative Members would say quite openly that they do not believe that our overseas aid should be distributed to foreign countries unless it goes either directly towards humanitarian aid in the poorest possible countries, or specifically where there is some benefit to British interests. I support entirely the decision of my right hon. and hon. Friends who were originally involved in the project. In the case of Malaysia, they did exactly what they thought was in the British interests. In the harsh light of day, there may have been economic arguments against putting the dam in that particular place or against there being a hydro- electric project as against a gas-fired project. However, that was the Malaysian preference and it represented an effort to restore our diplomatic and trade links with that country ; that was in the British interests.

Mr. Mans : Does my hon. Friend agree that what is so disturbing about the whole affair is that the article in The Sunday Times about alleged corruption in the Malaysian Government was published with a picture of the Pergau dam underneath it, despite the fact that the story was more than nine years old and in no way related to the Pergau dam ? That is what the Malaysians were complaining about and why they took the action they did, which proves

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conclusively that their action had nothing to do with the project or the arms sales that took place at about the same time to Malaysia.

Mr. Hargreaves : I am grateful to hon. Friend, as I can now foreshorten my remarks. I was about to come specifically to that point. What aggrieves me and my hon. Friends is that the right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) did not take that into consideration. In an uncharacteristic fashion, the right hon. Gentleman went down a route of what can only be described as rather shabby smearmongering.

Mr. Burns : But that is characteristic.

Mr. Hargreaves : No, I disagree. I believe that such smearmongering appears to have been promoted by one or two individuals here, perhaps with senior editors of certain Sunday or other newspapers, carrying out a distinct campaign or vendetta, particularly against the Prime Minister, but also against the Foreign Secretary.

It is sad when British interests and jobs--in companies such as by Biwater or PowerGen, which are in neighbouring constituencies to mine, and in which my constituents work--are put at risk by other people's political smearmongering and by the vendettas of one or two editors against Ministers or against the Prime Minister himself. That is extremely regrettable and I urge Opposition Members to refer their remarks strictly to the appropriateness of the dam and the Malaysians' choice of that project, rather than trying to obtain some cheap political capital out of smearmongering.

6.40 pm

Sir Russell Johnston (Inverness, Nairn and Lochaber) : On the basis of the old military adage that attack is the best form of defence, I expected the Chief Secretary to the Treasury to wind up. He could then have said to us, "If you think that we are bad, look at all these other chaps ; they are so much worse."-- [Hon. Members :-- "Foreigners."] Who can speak about foreigners with more knowledge and certainty than those with foreign blood in their veins ?

In his opening speech, my right hon. Friend the former Liberal leader, set out our criticisms and specific recommendations. With respect to some of the reactions that we had from Conservative Members, he was restrained.

Mr. Burns : Sleazy.

Sir Russell Johnston : I know that the hon. Member for Chelmsford (Mr. Burns) virtually frothed at the mouth at one stage.

Mr. Burns : It was sleazy, innuendo and rubbish.

Sir Russell Johnston : The hon. Gentleman obviously believes that shouting at people is good for his soul, but it does not advance rational argument. I am saying that my right hon. Friend advanced a rational argument which is also demonstrated in many other places. There is no doubt whatever that these are matters of public concern. They have attracted particular attention in a number of newspapers. The hon. Member for Birmingham, Hall Green (Mr. Hargreaves) indicated that if matters were raised in The Independent on Sunday , the Observer or The

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Sunday Times it is media hype. Other hon. Members said the same. That is quite a surprising view to take of newspapers that attempt-- The Independent on Sunday and the Observer certainly do--to maintain intellectual standards of journalism.

Mr. Mans : Does the hon. Gentleman agree that the article that caused such offence to the Malaysian Government had nothing whatever to do with the Pergau dam, despite the fact that the newspaper published a picture of it below the article ?

Sir Russell Johnston : I suppose it was triggered by it, but I am not arguing with the hon. Gentleman about that. As some quick-witted chap-- quicker witted than I--said earlier, perhaps the Government should do something about Murdoch. That perhaps was quite a good point.

Mr. Corbyn : It was me.

Sir Russell Johnston : There is no doubt that the non-governmental organisations are deeply unhappy about certain developments in the British aid policy and programme. That also cannot be denied by Conservative Members. We can always argue about the size of the aid budget, but the House should not forget that the Conservative manifesto of the previous election contained a commitment to meet the United Nations target of 0.7 per cent. of gross national product, and that the Prime Minister renewed that commitment in the run-up to the Rio summit. That is on the record. Yet, under the Conservative Government, whatever words are written or spoken, the proportion of GNP has declined from 0.51 per cent. in 1979 to 0.31 per cent. in 1992 and is projected to fall to a record low of 0.26 per cent. next year. That is a very bad record.

The Minister of State, the right hon. Member for Eddisbury (Mr. Goodlad), chided my right hon. Friend. In my opinion, the Minister is usually amiable --sometimes a little deadpan, but certainly amiable. But on this occasion he said, rather uncharacteristically, that my right hon. Friend was unhelpful to those working in the field. I do not accept that at all. Indeed, both Ministers know that the opposite is true. The NGOs have been in touch with my right hon. Friend and me in advance of the debate, expressing views, many of which he articulated. There is no doubt that the leading NGOs in the aid field are concerned about not only aid quantity, but aid quality ; whether it is rightly focused, as the Government continually claim ; tied aid ; and the role of the aid and trade provision and so on. Therefore, it is not at all fair for the Minister to attack my right hon. Friend on that basis.

The Minister also seemed rather reluctant to engage in a debate on that question. His speech was rather spattered with phrases such as "they could not care less about the poor in Indonesia." He was referring to the collectivity of Opposition Members. What he said was totally untrue. It was quite ridiculous to suggest such a thing. There is a legitimate cause for concern about the treatment of East Timor. He did not respond to that. He said :

"Our aim is to influence rather than to isolate Indonesia." What influence have the Government had in East Timor ? It is not an easy issue. I am not trying to pretend that it is or that we have some great simplistic solution. One might say that cutting aid will hurt only the helpless, who are not responsible for these human rights infringements.

One could equally say that sanctions on Serbia are undoubtedly harming a great many totally innocent people

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who have nothing to do with the adverse side of Serbian policy. But knowing that should not lead us to ignore the problem or not to be willing where necessary to face up to those things. What concerns us is that the Government, so far as we can judge, and I agree that the evidence is circumstantial, are not wrestling with those admittedly difficult problems, but are allowing their judgment to be over- influenced--I put it no stronger than that--by the market for arms. That might be resented by Conservative Members--and is in some cases. That has been consistently denied--I recognise that--but it is widely believed, not for any sleaze reasons, among commentators and the NGOs.

On Malaysia, no one has explained what the Foreign Secretary meant when he talked about the aid and trade being "briefly entangled". Thailand has benefited from a 624 per cent. increase in United Kingdom aid between 1980 and 1992-93. It was also the fifth largest buyer of British arms ; Indonesia was the fourth.

There is clearly a difference within the House, not always simply on the basis of the two sides on the issue, because it is difficult. It also relates to constituency problems. That is undoubtedly the case. But surely we should have some policy on aid, some view of what Government should do. For example, both Japan and the Netherlands have decided to adopt an aid policy that consciously favours countries that renounce the arms trade. Many countries are not subject to any perceptible exterior threat.

Mr. Duncan : Does not the hon. Gentleman accept that most of our major competitors see their aid programmes as part of their foreign policy ? Does he not accept that most companies should adapt their business practices to suit the markets in which they are working ? Is Liberal Democrat policy now "When in Rome, be British"--or, to put it another way, "Always play the game, and always lose" ?

Sir Russell Johnston : The short answer is no. I do not think that I need expand on that very much.

The Government have not been terribly persuasive today. Will the Minister please try to tell me what sort of guideline suspends aid in the case of Kenya--probably quite properly--but does not do so in the case of Indonesia ? I simply do not follow the logic. Certainly, the Government themselves would always say that they have a logic, and have sustained it ; but I do not see any consistency.

The right hon. Member for Mid-Sussex (Mr. Renton), a former Conservative Chief Whip, has graced the Chamber with his presence for 20 years. He said that we must adjust to ways of doing trade--as did the hon. Member for Rutland and Melton (Mr. Duncan)--and that we could not tell other people how to trade. There is a good deal of truth in that : I follow the argument. It is, of course, not always corrupt for some enabler to get a commission--but it can be corrupt. It seemed to me, sadly, that the ultimate logic of the right hon. Gentleman's argument was that any illusions about a good governance concept operating in aid policy should simply be dumped, because Governments would simply conform to local conditions. If local conditions mean a few pounds here and there--or whatever currency obtains ; rupees, perhaps--that is the way life is.

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As I have said, it is not easy. I am annoyed, however, when people say, "We have a good governance clause", and then do little about it. Conservative Members may say that Liberal Democrats, or even Labour Members, are being naive ; I heard that word once or twice. But we must have some bloody ideals, must we not ?

Hon. Members will be relieved--as will you, Mr. Deputy Speaker--to learn that I do not intend to go over the Pergau dam affair again ; it has been dealt with at length by my right hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) and the hon. Members for Monklands, West (Mr Clarke) and for Clydebank and Milngavie (Mr. Worthington).

I want to make two more short observations before concluding on the controversial issue of political contributions from companies, which will allow certain hon. Members to froth at the mouth again. First, the Government continually claim that 80 per cent. of British aid goes to the poorest countries. I am afraid that that does not mean that it reaches the poorest people. An OECD report on international aid to basic education found that only three donors in the world spent more than 25 per cent. of their educational aid budgets on basic education and adult literacy--New Zealand, which spent 63 per cent. ; Sweden, which spent 53 per cent. ; and the United States, which spent 42 per cent. We spend 5 per cent., which is not enough. Secondly, it is worth reminding the Government that the non- governmental organisations--virtually unanimously, as far as I know--are not in favour of tied aid, considering it in the main more expensive and less effective. They think that it tends to concentrate on large projects which may often be inappropriate. I shall not go over the appropriateness of the Pergau dam project again, but there are other examples in the world : large capital projects have been chosen, not primarily because of attitudes to aid but because the action was commercially driven by the donors, who wanted the work connected with the construction of a large project.

Let me say a little about the question of "sleaze". Conservative Members took great offence from the comments of The Independent on Sunday

"Clique makes millions from aid...Five companies led by Tory loyalists pick up half the cash...System hurts countries most in need".

The simple answer that the Minister would give is to say that those are the best companies anyway ; that there are relatively few companies with the expertise, the knowledge and the track record to undertake such large capital projects abroad. Other Conservative Members will add that, if those companies give money to the Conservative party, that is only their common sense coming to the surface ; they would do that naturally.

The Government, however, really must address the problem of patronage, and the link between action and "who you know and who you don't". It is true that most companies would rather give money to the Conservative party than to Labour or the Liberal Democrats ; but it is also true that, as a consequence, they have a certain influence with the Government. That was, perhaps, more true for the Labour party in the old days, when it was certainly true that the trade unions--as the Labour party's paymasters--had a certain influence with that party.

Mr. Bernard Jenkin (Colchester, North) : What about the British School of Motoring ?

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Sir Russell Johnston : I am very pleased that the hon. Gentleman is happy with his humour. It is always a good thing to be happy with one's humour. Unfortunately, I did not hear what the hon. Gentleman said, but I ask him not to repeat it.

My right hon. Friend made the important point that it would be a good idea to review, or reform, the financing of political parties. That would be for the good of our democracy, and would avoid accusations which, in this case, do not add up to a great deal, but do not look at all good. I think that state financing of political parties lifts suspicion and makes everything clear and above board ; that is the case in most of our colleague countries in the European Union.

The Government would be foolish to ignore the unhappiness and concern that exist widely among people who are knowledgeable about, interested in and concerned with overseas aid. I do not think that our record is as good as it should be, and to defend it blindly will get us nowhere.

6.57 pm

The Minister for Trade (Mr. Richard Needham) : The right hon. Member for Tweeddale, Ettrick and Lauderdale (Sir D. Steel) made five points, and I shall do the same. I shall talk about the aid and trade provision and arms, the Liberal party and the ATP, alleged company support for the Conservative Government to sweeten aid deals, the behaviour of some of the press recently--particularly as that issue deeply concerns the Malaysian Government--and the lessons to be learnt.

I shall concentrate on the ATP. As many of my hon. Friends have said, it amounts to only 5 per cent. of our total aid budget, but it is a very important 5 per cent. Aid leads to trade, and trade leads to an increase in manufacturing exports. As Minister for Trade, I am responsible for trying to help British manufacturers to compete around the world.

My right hon. and hon. Friends will have noticed one aspect of the speeches of Opposition Members. Not one--apart from the hon. Member for Inverness, Nairn and Lochaber (Sir R. Johnston) mentioned what our competitors do. What happens to the French, the Germans, the Italians, the Japanese and the Americans is of no concern to them. Their aims were summarised in the clever, dissembling speech of the right hon. Member for Tweeddale, Ettrick and Lauderdale.

I go round the world with the right hon. Gentleman, and when he is cleverly dissembling on behalf of Britain I will be on his side all the way. I have to say, however, that I think that what he said tonight in terms of innuendo, assertion and suggestion was a disgrace. We are not, in the debate, taking part in some university debating society game about what happens with the major markets for our economic potential. As the hon. Members for Monklands, West (Mr. Clarke) and for Derbyshire, North-East (Mr. Barnes) said, we are speaking about thousands of jobs and billions of pounds' worth of business. The right hon. Gentleman lambasted the Malaysians and castigated the Indonesians. Other Opposition Members had a nice little go at Thailand. They are the major markets for British increased exports and trade for the future.

If we wish to get into those markets with our competitors, what do we have to do ? We have to establish trust. We have to establish friendships. The hon. and learned Member for Montgomery (Mr. Carlile) spoke about a cosy friendship between British Ministers and

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Malaysian Ministers. I do not know what he meant by that. I spend most of my life trying to make cosy friendships with buyers overseas. That is what I thought my job was.

Mr. Beggs rose

Mr. Needham : I will give way in a minute.

One of the ways of doing that is to ensure that aid and trade provision is available to assist infrastructural development. That infrastructural development is so vital to those countries and so vital a base for our manufacturing industry to build on.

Mr. Beggs : Will the Minister confirm that we in Northern Ireland especially are very dependent on export orders, that those people responsible for careless talk can damage both trade and aid, and that this country would be done a great service by those people who have made unfounded allegations if they would withdraw them and apologise ?

Mr. Needham : The hon. Gentleman and I spent many months trying to save GEC Larne because of the problems with Rihand II in India. No one has yet spoken about India or China, by the way. That factory was being taken over, as he knows, by F.G. Wilson, now the largest manufacturer of small generators in the world. Where will it be in the markets that it is trying to sell in, if we continue to suggest to the Governments, and to the people who are doing business, that somehow most of them, if not many of them, are involved in some sleazy, underhand dealing ?

The right hon. Member for Tweeddale, Ettrick and Lauderdale asked, quite rightly, what the British Government's view is about underhand dealing. That is a perfectly fair question. We do not support underhand dealing. We do not support bribery. We are perfectly sure that the Organisation for Economic Co-operation and Development working party, which is working towards ways of getting rid of corrupt practices, should be supported, but there is no point in our singularly summing up with a solution that is neither workable nor realistic. That simply makes no sense.

What we have to do, as our first and foremost principle, is to ensure that the interests of our aid budget, and the trade that follows from that under the aid and trade provision umbrella, are properly protected in the interests of this country.

If we take the line of the right hon. Member for Tweeddale, Ettrick and Lauderdale, which is to say that there is a linkage between the ATP budget and the arms sales that we make in those countries, when will we make arms sales to those countries ? Should we not give the Indians, the Indonesians, the Malaysians and the Thais the right to self-defence ?

Is the argument of the right hon. Member for Tweeddale, Ettrick and Lauderdale that we supply arms or that we supply ATP ? We cannot do both, because if we do both, the right hon. Gentleman and his right hon. and hon. Friends will link the two. What will be the effect then on the countries to which we are trying to sell ? Will they again come to us and give us orders if they are going to be slated and slandered in the press of this country and on the Floor of the House of Commons ? Of course they will not.

That brings me to the subject of the Liberal party and arms and ATP. There was an advertisement published this weekend in the national press which said,

"We are proud to work in Malaysia."

One of the companies that was advertising was the

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