Foreign Exports (Subsidies)

Oral Answers to Questions — Trade and Commerce – in the House of Commons at 12:00 am on 19th November 1953.

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Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West 12:00 am, 19th November 1953

asked the President of the Board of Trade what progress has been made by Her Majesty's Government towards reaching agreement with member Governments of the Organisation for European Economic Co-operation and with Governments of other European countries on the subject of subsidies to exporters, designed to give such exporters an advantage in competing in world markets.

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

Her Majesty's Government have taken a lead in efforts to get rid of export incentives of various kinds which amount to concealed subsidies. This matter is at present being studied by the Organisation for European Economic Co-operation; and the Council of European Industrial Federations has, on the initiative of the Federation of British Industries, unanimously condemned the race between countries to grant such export incentives.

Photo of Mr Donald Wade Mr Donald Wade , Huddersfield West

Does not the right hon. Gentleman agree that these subsidies to exporters, which are designed to capture overseas markets, may have the effect of bringing about that form of economic warfare which did so much harm to international trade before the war? Can he say when he will have anything further to report on the conversations which, I understand, have been taking place in Paris?

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

I agree that these forms of subsidies are thoroughly undesirable. We have already made some considerable progress, and Germany, France and the Netherlands, for example, have already dispensed with or modified their arrangements for currency retention. If the hon. Gentleman puts down a Question, I will certainly inform him on how things go.

Photo of Mr Arthur Bottomley Mr Arthur Bottomley , Rochester and Chatham

Does the right hon. Gentleman's answer mean that it is the policy of Her Majesty's Government to remove tariffs and other trade barriers altogether?

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

This Question refers to export subsidies, which was what I was dealing with.

Photo of Mr Anthony Hurd Mr Anthony Hurd , Newbury

asked the President of the Board of Trade to what extent the Government are prepared to accept offers of surplus United States produce that carries an export subsidy in one form or another; and how far these offers are subject to the General Agreement on Tariffs and Trade.

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

We are ready to consider offers by the United States of surplus products we require. Any purchases of such produce would, of course, be the subject of prior negotiation between the two Governments, and we for our part would take due account of all relevant considerations including price and the availability of home supplies.

As regards the second part of the Question, the General Agreement on Tariffs and Trade does not prohibit export subsidies, but if any member of the General Agreement subsidises exports in such a way as to cause serious prejudice to the interests of any other member, it is open to the latter under the General Agreement to seek redress.

Photo of Mr Anthony Hurd Mr Anthony Hurd , Newbury

May I take it that the President will be very ready to seek that redress if the occasion arises?

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

Yes, but that would be more likely in the case of imports into a third country than into this country.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

Will the Minister tell us why we, as an importing country, should refuse the free present to us represented by the subsidies?

Photo of Mr Peter Thorneycroft Mr Peter Thorneycroft , Monmouth

It would depend upon what the present was.