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Manufacturing Trade
14. Mr. Canavan: To ask the President of the Board of Trade what is the balance of trade in manufactured goods in the latest quarter. [32121]
Mr. Nelson: There was a deficit of £2.5 billion on trade in manufactured goods in the first quarter of 1996.
Mr. Canavan: Is the Minister aware that the United Kingdom's trade balance in manufactured goods went into deficit in 1983 for the first time since the industrial revolution, and has remained in deficit ever since? Given that this country has a worse trade balance than any other European Union member state, how on earth can the Government claim that they are making Britain into the enterprise centre of Europe? The truth is that the President of the Board of Trade is the captain of a team that is at the bottom of the European league.
Mr. Nelson: That is another extremely depressing analysis, completely unrelated to the facts. Since the Conservative party came to office, the number of manufacturing exports has doubled. Moreover, the hon. Gentleman referred only to manufacturing exports. We have a £5.5 billion surplus on our services account.
It is necessary to look at the whole picture. Like so many of his hon. Friends, the hon. Gentleman is highly selective and extremely deprecating about our trade performance. Much is going well. He would do better to concentrate on success stories such as that of Exabyte in his constituency, which has created 200 jobs--and what about Walter Alexander, also in his constituency, which has sent £20 million-worth of exports to the far east and created another 200 jobs? Those are good jobs, created by the policies of a Conservative Government.
Mr. Bernard Jenkin:
Talking of competitiveness, is my hon. Friend aware of the revised World Economic Forum global competitiveness league? The United Kingdom has moved up in that league: we are now No. 3 in Europe, at 15th place, while France and Germany have been relegated to 22nd and 23rd. That suggests that we are indeed becoming the enterprise centre of Europe.
Mr. Nelson:
I am grateful to my hon. Friend for putting the record straight. He is right to point out that our trade and export performance has been moving up the league in both absolute and relative terms. All that reflects the implementation of Conservative policies in practice and in government. Those are the policies that will create lasting jobs in this country.
Mr. Sheerman:
Is the Minister speaking, or even perhaps listening, to the Confederation of British Industry and our leading exporters, all of whom are saying--certainly to Opposition Members--that they are very concerned about the Government's policy on Europe? The current activities and divisions in regard to interference with decisions by the European Commission lead them to fear that the Government's commitment in their major trading area is weakening. Do not the CBI and our global performance--based here, but global--need the assurance of a strong commitment to Europe that they are not gaining from a party that is riven by divisions on where it is going in Europe?
Mr. Nelson:
Of course I do not agree with the hon. Gentleman's conclusion. Conservative Members assert that there is no incompatibility between fighting our corner hard in Europe and being strongly in favour of the ambitions and objectives of the economy that Europe can create by acting in concert. This party in government will always stand up for our interests, but it will always play its part in Europe. The hon. Gentleman, the CBI and everyone else should be left in no doubt about that.
Mr. Forman:
Can my hon. Friend confirm that our balance of trade in manufactured goods in some of the fastest-growing markets in the global economy is healthy and improving? Are there not encouraging examples in, for instance, our trade with parts of Asia and the Pacific rim?
Mr. Nelson:
There are indeed. I pick out countries such as Indonesia and India--[Interruption.] Even if we do not take into account some of the military equipment to which Opposition Members have referred from a sedentary position, our exports in key sectors such as power generation, construction and water infrastructure have been outstanding. They are in surplus, and there is every prospect of their increasing further.
15. Mr. Dalyell:
To ask the President of the Board of Trade if he will make a statement on the conviction of McNeill International in the USA on a charge of exporting educational computer equipment to Libya. [32124]
Mr. Dalyell:
Does the Minister recollect that, shortly after leaving the Department, the right hon. Member for North Wiltshire (Mr. Needham) made a characteristically candid statement, expressing his exasperation with the Foreign Office for having put spokes in the wheel of trade in vehicles between Bedfordshire and Libya? Are we quite sure that we are not once again being taken for a commercial ride by the Americans? Libya is our traditional market; the decision makers were trained in Britain and not in the United States.
Will the Minister look carefully at this case, because some of us think that the Americans have quite cynically scapegoated Libya, that the Libyans were not responsible for Lockerbie, that it is doubtful that they were responsible for the murder of Yvonne Fletcher, and that it is doubtful that they were responsible for the La Belle discotheque incident, which caused the bombing?
Mr. Oppenheim:
I always genuinely listen to the hon. Gentleman carefully, but it strikes me as odd that he and some of his colleagues always kick up a fuss--sometimes understandably--about equipment exports from Britain to other regimes that they find distasteful, such as Burma, yet want us to export to the more distasteful, authoritarian and, in many ways, vicious regime of Libya. It was not British goods being exported to Libya and stopped but American goods, which the Americans stopped a British exporter indirectly exporting to Libya via a third country. The Americans have their own rules on exports to Libya, and in this instance they asked for our assistance in helping to prevent their laws from being broken on their soil. We gave that assistance and would expect it to be reciprocated if the situation were the other way around.
Sir Teddy Taylor:
Is the Minister aware that McNeill International could be prosecuted for exporting radiographic equipment to Libya? Libya is about the only country in the world that is denied treatment for cancer simply because of what seems to be a rather mad policy. In view of that and of the fact that, on 26 May, a citizen of Lebanon was arrested, extradited and brought to trial in Germany for the Berlin bombing, which we and the Americans used as the excuse for bombing Libya, might there be a case for reviewing a silly, cruel and heartless policy?
Mr. Oppenheim:
I cannot comment on the individual case, unless my hon. Friend gives me the details, but we have a policy of strictly adhering to United Nations sanctions on exports to Libya. The Americans have their own rules, which go further. If the Americans decide that they do not want to export certain goods to Libya, that is their business. Where it becomes our business is if they try to claim extra-territorial rights, by claiming that they have some say beyond the UN sanctions over what we or other countries export to Libya or other countries.
Mr. Dalyell:
On a point of order, Madam Speaker. There is a lot more to this, and I hope to raise it on the Adjournment.
16. Dr. Spink:
To ask the President of the Board of Trade what assessment he has made of the impact of deregulation on inward investment. [32125]
Mr. Oppenheim:
Our deregulated business environment is recognised as one of our key strengths by inward investors. It is one of the many contributory factors that have made the United Kingdom the No. 1 location for inward investment into Europe.
Dr. Spink:
Does my hon. Friend agree that, if this or any Government followed the European model or, indeed, the socialist model on regulation and interference, inward investment would fall?
Mr. Oppenheim:
My hon. Friend is right, and I will give him one good example of where our policies of deregulation and open markets have led to more inward investment. We were leaders in deregulating and privatising telecommunications. We were opposed at every step in liberalising telecommunications by scare stories that were published and peddled by Opposition Members. We were told that telecom engineers would be electrocuted up telegraph poles, that little old ladies in remote communities would be cut off and that telephone boxes would disappear from high streets. We have seen instead the most rapid improvement in telecommunication services coupled with falling prices and an increased number of telephone boxes of any major industrial country, which has helped to attract business to Britain and jobs for British people.
Mr. Purchase:
Will the Minister admit that about one quarter of all inward investment has been for the purpose of purchasing British companies, and that the cumulative total of capital exported from this country on the same basis is far in excess of the sum invested in Britain? Does that not show that Britain's so-called deregulated economy is less attractive to investors than so-called regulated economies elsewhere?
Mr. Oppenheim:
Either the hon. Gentleman is one of the new Labourites who believe in the open market or he is not. If he does believe, as his party apparently does, he should accept two-way investment flows. The Germans, who have a more regulated market than ours, invest more in Britain than we do in their country. Conversely, we export more to France than the French invest in Britain. That is the nature of a modern global economy. Perhaps the Germans know something that the French do not.
Mr. Anthony Coombs:
As Britain attracts more than 40 per cent. of US and Japanese investment in Europe, does my hon. Friend agree that that might have more to do with an observation made last week by George Simpson, chief executive of Lucas Industries, who is to be the new chairman of GEC? He commented that, in 30 years in business, he could not remember a time when economic policy was managed in such a way as to produce a better competitive environment for British industry.
Mr. Oppenheim:
My hon. Friend is absolutely right. That state of affairs is in stark contrast to the position that we inherited. I remember a trade union leader saying that he would only buy a Ford car made at one of the company's German plants. In the 1970s, General Motors and Ford were falling over themselves to push investment out of Britain and did not export any cars from this country. Today, GM, Ford and the Japanese companies
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