As the figures for the first half of last year show, progress was made. Exports rose, imports remained stable and we were able to pay off a certain amount of debt. We have not got the full figures for the second half of the year yet, but I do not think there is very much doubt that our trading position remained basically sound. This, of course, is the difficult time of the year, and there were the beginnings of difficulty over oil during that period, but basically the trading position remained sound.
What we had to face in the second part of the year was a banking crisis caused by the events in the Middle East. We got over that, as the right hon. Gentleman said, by mobilising our reserves and putting them in the shop window, and we are very grateful indeed for the cooperation we had from both the International Monetary Fund and the United States of America in doing so. The effect of that was to put us on an even keel again.
However, the point—it is a very important one—is that we should not have weathered that storm so easily if our trading position had not been basically sound. I think it would have been impossible to face a commercial crisis and a banking crisis simultaneously. Fortunately, owing to the steps that had been taken, we were able to weather the storm.
The present Prime Minister said on 4th December that the best forecast he could make was that we should be in balance for the year ending 30th June. Now—two months later—we calculate that our position will be rather better than that. It is too early to make precise forecasts, but we think that we shall end with a small, but by no means unsubstantial, surplus rather than all square.
As I have said, we have built up the reserves and we have weathered the crisis. What we now have to do is to rebuild and earn a sufficient surplus not only to cover our trading balance and our loans abroad but to build up a stronger liquid position in the centre here.
The right hon. Gentleman mentioned the balance of trade figures for January. I entirely agree that they are not good. They are caused partially by the dislocations following the closing of the Canal and the various consequences to shipping following from that. In one respect his figures were not quite right. He said that if one averaged the last three months one would notice that there had been a considerable deterioration. I do not think that is true. If one compares the figures for the last three months with the figures for the preceding ten months, one sees that in the last three months both imports and exports were up about 2 per cent., and the gap in the last three months was £53 million whereas in the previous ten months it was £52 million. Consequently, there is no very great difference there. I think it is too early to suppose that this indicates any change in the trend.