With permission, Mr. Speaker, I shall make a statement on the economic summit held in Tokyo on 4–6 May at which I was accompanied by my right hon. and learned Friend the Secretary of State for Foreign and Commonwealth Affairs and my right hon. Friend the Chancellor of the Exchequer. Copies of the statements issued by the summit have been placed in the Library of the House.
The summit dealt with five principal issues: international terrorism, the Soviet nuclear accident, economic policy, protectionism and agriculture.
On international terrorism, we specified a number of measures which each of us resolved to apply in our own jurisdiction and agreed to encourage others to apply as widely as possible. The measures are: refusal to export arms to states which can be clearly shown to be involved in sponsoring or supporting terrorism; strict limits on the size of the diplomatic and consular missions of such states, controls on the travel of their members and radical reductions or closure of their missions where appropriate; denial of entry to all our countries for persons who have been expelled or excluded from any one of them for reasons connected with terrorism; improved extradition procedures in order to bring suspected terrorists to trial; stricter immigration and visa requirements in respect of nationals of states responsible for terrorism; and the closest possible bilateral and multilateral co-operation between police and security organisations in the fight against terrorism. We also agreed to consider together any further measures which may be needed.
Our statement will be a clear signal that the summit nations will not tolerate state-sponsored terrorism and it will bring home to those who practise such terrorism the heavy costs which they will incur. Terrorism must be resisted, not appeased.
We examined the implications of the accident at the Chernobyl nuclear power station. We expressed our sympathy for those affected and offered any assistance that might be requested. Our statement recorded our continuing confidence in a properly managed nuclear power industry, that is, one which sets the highest possible standards of safety in the design, manufacture, operation and maintenance of nuclear installations. Each country has a responsibility to adhere to those standards, both to its citizens and to the wider community. Each country also has a responsibility to provide promptly detailed and complete information on nuclear emergencies, especially those with consequences across national frontiers.
We therefore recommended that an international convention should be drawn up, as soon as possible, which would commit the parties to report and exchange information in the event of nuclear emergencies.
In our discussion of economic matters, we noted that the economies of the industrialised countries are now in their fourth year of expansion, that in all our countries the rate of inflation has been declining; that this decline, in conjunction with continuing prudent fiscal and monetary policies, has created the conditions for lower interest rates; and that there has been a significant shift in the pattern of exchange rates which better reflects fundamental economic conditions.
We agreed that the recent decline in oil prices would help to sustain non-inflationary growth and increase the volume of world trade.
We established new arrangements between the seven summit countries to make economic co-operation more effective.
We recognised that the world economy still faced a number of difficult challenges.
Although we have had some success in creating new jobs to meet additions to the labour market, unemployment remains excessively high in many of the summit countries. Other persistent problems are large budgetary deficits and trade imbalances, protectionist pressures and the continuing difficulties of many developing countries and severe debt problems for some.
But overall we agreed that developments since our last meeting in Bonn have demonstrated the effectiveness of our policies; and that continuation of them will enhance the prospects for, and confidence in, the future of the world economy.
In dealing with protectionism, we reiterated our support for the early launching of a new round of multilateral trade negotiations in the GATT and looked for decisive progress at the ministerial meeting already scheduled for September.
We also proposed that the new round should among other things address the issues of trade in services, foreign direct investment and intellectual property rights. I believe that this last point will be especially welcomed by the many British companies which have seen their copyrights and patents blatantly disregarded.
In our discussions on agriculture, so important to the well-being of our rural communities, we considered in particular the consequencies of world-wide agricultural surpluses. These have arisen as a result of technological change and of long-standing policies of domestic subsidy and protection in all the summit countries. We recognised that the existence of these surpluses and efforts to dispose of them harm the economies of certain developing countries and aggravate the risk of wider protectionist pressures. We agreed that, as these concerns were common to all summit countries, they could be resolved only by effective co-operation between us; they cannot be solved by competitive subsidies and protection.
We discussed a considerable number of other issues including East-West relations and arms control, the middle east, South Africa and the need to maintain the momentum of international action against traffic in drugs, following up the initiative taken by the United Kingdom at the Bonn economic summit last year.
I should like to pay tribute to the skilful and effective chairmanship of the Japanese Prime Minister, Mr. Nakasone, which contributed greatly to the success of the meeting.
The hallmarks of this summit were unity and confidence: unity in our determination to see that those who practise state terrorism do not succeed; confidence that our economic policies are right and will bring greater prosperity to our peoples. The United Kingdom was able to play a prominent role in achieving these results and in ensuring a valuable, constructive and forward-looking summit.
May I first endorse the general view expressed by the summit seven on the implications of the disaster at Chernobyl? May I also express the hope that each country will rigorously adhere to the statements on high standards of safety, candid information and an effective response to emergencies, both domestically and internationally? Even though I appreciate the impediments, may I particularly support the efforts to secure an international convention committing countries that produce nuclear energy to report and exchange information?
On economic matters, the summit statement surpasses all previous statements in its self-satisfied complacency. In so far as some significant action was proposed, why did not the Prime Minister support the attempts of the United States Treasury Secretary, James Baker, to secure some real co-ordination in the international trade and financial system? Is an annual meeting between seven Finance Ministers simply to "review" performance, as the statement puts it, not a pathetically inadequate response to the need for international co-operation and co-ordination to combat unemployment and under-development?
I am sure that the whole House will recognise the general worthiness of the summit statement on terrorism. However, does not the view of the Japanese Government, that the implementation of the statement on terrorism
is a matter left for each country's judgment
there is virtually no measure which Japan should take in a concrete way
somewhat reduce the validity of that declaration on terrorism?
What is the Prime Minister's response to the post summit statements of both President Reagan and Vice-President Bush concerning Syria? Does she agree with Signor Craxi that military action is "precluded" by the Tokyo agreement? Can the right hon. Lady clear up the confusion that obviously exists on this vital question among the Japanese, the Italians and the Americans, since they obviously hold different views about what "mission accomplished" actually means?
Frankly, if the permissive and vague statement on terrorism was supposed to be the great achievement of last weekend in Tokyo, this summit reached new levels of stagnation, selfishness and superficiality.
Whatever the right hon. Gentleman says, he cannot detract from the great success of the summit, which was recognised by those there and almost universally. I found his statement excessively banal.
I am grateful to the right hon. Gentleman for what he said about the Chernobyl nuclear accident. I think that he endorsed what the summit said about it.
With regard to international co-operation on monetary matters and the world economy, we worked very closely with Secretary Baker, and my right hon. Friend the Chancellor of the Exchequer and we have worked closely together throughout the year. There have been excellent results from that co-operation and from the summit.
There is a very clear declaration on terrorism, to which all summit countries are committed. We shall obviously be monitoring its application.
With regard to any other countries which may or may not seem to exercise state-sponsored terrorism, we shall have to consider this when and if we have evidence which clearly means that they are involved in state-sponsored terrorism. There would have to be consultation among the summit seven to apply sanctions to any other country.
In respect of the terrorist document, the Prime Minister has been among the first to realise that an essential element in the long-term treatment of the matter will be to obtain an agreement on the ground of extradition and somehow to co-ordinate extradition laws so that people cannot escape responsibility for terrorism by opposing extradition on political grounds. Although the Prime Minister obviously could not obtain immediate results, did she find a generally sympathetic attitude towards the idea that this will be an essential feature in the conquest of terrorism?
Yes, Mr. Speaker. Improved extradition procedures were one factor which was highlighted by the summit countries. My right hon. Friend is aware that we are looking to improve our extradition procedures because they are not sufficient to enable us to ratify some European conventions. We have published our intentions in a White Paper and measures will come forward in the Criminal Justice Bill next Session.
What has made the Prime Minister so much more enthusiastic about summits than she was seven years ago, especially since the 1979 Tokyo communiqué was rather more precise on this subject than is the present communiqué? What is her position on exchange rates? Does she agree with Mr. James Baker that this is the most important development since the end of Bretton Woods, or was she correctly reported as expressing complete scepticism about the ability to achieve any stability in exchange rates?
As the right hon. Gentleman will be aware, I prefer summits that meet only once a year to those that meet three times a year. In Europe, we no longer meet three times a year, as we did when he was President of the EEC. It has been reduced to twice a year, which most people would agree is a great improvement and is about the right number.
The right hon. Gentleman will recall the previous Tokyo summit in 1979, which dealt with oil imports. It was not the world's most successful summit either in its conclusions or in its unity.
Thr right hon. Gentleman would be the first to know that there can be no such thing as a universal fixed exchange rate for all countries unless all of them run their economies in the same way. Even then, the exchange rate could be badly upset by sudden events such as increases or reductions in oil prices. He would be the first to know why the Bretton Woods system broke down and the first to be aware that, for the time being, the G5 countries have what could be called a managed float. It can be managed only because the yen and the dollar got wholly out of line with the underlying factors in their economies. Therefore, the measures taken are meant to bring them more into line with the underlying economic strength of both countries.
Is my right hon. Friend aware that all responsible Members on both sides of the House will welcome what she has said about the international agreement to combat the scourge of international terrorism? Can she say a few more words about what is proposed for the future? Will she be a little more specific about the further measures to be considered?
A number of proposals were made for further measures varying from completely excluding—as we have done—Libyan people's bureaux from countries, instead of reducing them, to taking sterner measures to reduce the amount of oil which we take from Libya. Those matters will be further considered among us and, if necessary, further recommendations will be made.
As for protectionism, does the Prime Minister remember that, some months ago, she and other Ministers promised the country thousands of jobs and contracts arising from the star wars project? She must have known then that America operates enormous protectionism which would prevent our getting more than a minimal number of jobs. Was that matter raised at Tokyo and if so, with what results?
Our scientists and companies will compete for SDI contracts in the usual way. The hon. Gentleman will be aware that we have some specialists in certain aspects of SDI work who stand a very good chance of getting more contracts.
May I remind my right hon. Friend of the world-wide condemnation of the Soviet Union for not notifying the world immediately of the disaster at Chernobyl? I welcome her statement from the summit that assistance will be offered to the Soviet Union in the wake of the disaster. Is that assistance without conditions?
We recommend that, through the International Atomic Energy Agency, we should set up a more effective code for notification in such circumstances, which we obviously hope will not occur again. Nevertheless, it would be better to have a proper convention. We shall respond to any request for assistance. We have responded in so far as we have been asked, and, as far as I am aware, no conditions are attached to our offer. We intend and want to be as helpful as possible in these circumstances.
Did the Prime Minister raise with President Mitterrand the French terrorist attack in New Zealand when two Greenpeace crew members were killed by French agents, especially as the purpose of the Greenpeace mission was to draw the world's attention to the effects in the Pacific of French nuclear tests?
I did not discuss the Greenpeace matter in New Zealand with the French President. The right hon. Gentleman will be aware that France has apologised for the incident and is anxious to do as much as it can to clear up any outstanding issues with New Zealand.
As for food surpluses, the right hon. Gentleman will be aware that they regularly find their way to the Soviet Union. Indeed, I am often questioned in the House about the cheap rates at which they go to the Soviet Union.
Is my right hon. Friend aware that her robust approach to the Japanese regarding discriminatory tariffs on Scotch whisky was much admired? How optimistic is she that her efforts have borne fruit? Did she have the opportunity to raise with President Reagan the threat of increased tariffs on Scotch whisky in the United States, bearing in mind the fact that Scotch whisky is one of our most successful and important exports?
My hon. Friend knows that I tackled Prime Minister Nakasone about the enormously high tax that the Japanese put on Scotch whisky, which I regard as thoroughly discriminating and something of a test of whether the Japanese are really prepared to accept more imports to go a little way to redress their colossal external balance of trade. I made the same point to the President of the United States, because the matter has been raised in connection with the enlargement of the European Community. I said that I thought that it would be utterly wrong if any unilateral retaliation were taken. There must be discussion in GATT, if anywhere, and I hope that no action whatever will be taken against Scotch whisky.
Will the Prime Minister be a little more specific about the impact of the statement on co-operation against international terrorism? Is there to be increased funding for Interpol, which is short of resources? Are there to be any moves towards economic sanctions, following the example of the United States requesting the withdrawal of oil investments in Libya?
Is there to be any cut in arms trading to north Africa, Africa generally and the middle east? Was any consideration given to Mr. Peres' recent proposal for regional development plans for the middle east, which would do more than anything else to reduce instability and the threats of war and violence there?
With regard to Interpol, I am not aware of any shortage of resources as we intend to maximise co-operation. If there is a shortage, we must consider that. The right hon. Gentleman is aware that we do our level best to ensure that the police in Britain have the resources that they need. That would include cooperation between our police forces and others.
There is no embargo on oil in this communiqué, but the matter was discussed and could be considered further. As I said in my initial reply, we agreed on a refusal to export arms to states which sponsor or support terrorism. No doubt the Peres economic programmes would be of great help to some countries in the middle east, but they are no substitute for a political initiative.
When my right hon. Friend discussed British and other exports to Japan with the Japanese Prime Minister, did she say that, in addition to the unreasonably high import duties that they impose, despite their vast trading surplus, their retail system and specially elaborate method of mark-ups on imported goods which could possibly compete with Japanese-produced goods are deliberately designed to make it impossible for us to have a fair trading relationship with a country that we all very much admire?
I agree with my hon. Friend. Their retail system is grossly inefficient. However good might be the product that we are able to export to Japan, it cannot go into anything like as effective a retail distribution system as we have. We have raised this matter many times. Their distribution system is inefficient and grossly overmanned. I am afraid that it is a cultural problem and will take quite a long time to redress.
Earlier the Prime Minister justified the use of terrorism against Nicaragua on the ground that the regime has become even more authoritarian. Does she not realise that she has opened the door to any group of people who, on losing an election, choose to move outside the borders of their country and seek the finance, training and weapons of a neighbouring power to carry on their campaign against their country, using the methods of terror? Does she not realise that she is making the matter worse?
At no time did I justify the use of terrorism. I said that we support the Contadora process, which is a peaceful process. I noted in passing that the regime in Nicaragua is becoming more oppressive. Both of those are facts and do not warrant the premise on which the hon. Gentleman's question was based.
Is my right hon. Friend satisfied that sufficient progress was made in agreeing what steps are necessary to deal with the problems underlying terrorism, such as a serious new peace initiative in the middle east?
Foreign Ministers discussed the middle east. I agree with my hon. Friend. We are anxious that there is no new political initiative. We want there to be one. Several have collapsed and it is extremely difficult to find one that will be successful. We shall continue the search. My hon. Friend knows that I shall visit Israel later this summer—if we can call it summer—and we will do what we can to consider the matter before then.
Can Mr. Reagan take unilateral action against Syria now, in the light of discussions with the Prime Minister?
As for kidnap insurance and the Government's apparent desire to clamp down on these matters, did the Prime Minister raise the issue with other Heads of State? What was resolved, or does she intend to turn a blind eye?
The communiqué mentions Libya, but it does not mention any other state. If it applied to any other state., we should have to have evidence that the terrorism was state sponsored, similar to that in regard to Libya.
The hon. Gentleman knows that my right hon. Friend the Home Secretary is considering the question of kidnap insurance. Several insurance companies in Britain and other countries supply kidnap insurance. We have to consider the matter on a rather more unilateral basis.
I welcome the economic declaration which discusses the international debt problem and my right hon. Friend's mention of that problem in her statement. Was consideration given at Tokyo to any specific initiative in relation to the deterioriating debt-export ratio of some developing countries, which are particularly dependent on the export of oil or other commodities?
No, we did not go beyond the previous ways of dealing with international debt, which are on a case-by-case basis. We are aware that, whereas for some countries a falling oil price has been very helpful in enabling them to meet their debt obligations, there are countries where it has been very damaging and those countries may need more help to meet their debts. My hon. Friend will be aware of the Baker initiative in Seoul.
Why is the right hon. Lady so sensitive about the accusation that she turns a blind eye to terrorist methods when they are used against the Government of Nicaragua? Did she insist on discussing that matter with President Reagan, who is, in fact, engaged in supporting terrorist action against the Government of Nicaragua? Strong support is given in the communiqué on terrorism, which she praises so highly, to the demand that action should be taken, especially through the United Nations. Does that mean that she and President Reagan have now repented for the raid on Tripoli which was made in defiance of, and certainly not in concert with, the United Nations?
With regard to Nicaragua. I made it perfectly clear that Foreign Ministers and we support the Contadora process. With regard to terrorism and the action of the United Nations, the right hon. Gentleman will be aware of the resolutions of the United Nations General Assembly and the statement from the Security Council which all condemn terrorism most vigorously. The right hon. Gentleman will also be aware that the United Nations is not a body which can take or has taken any effective action in that regard.
Is my right hon. Friend aware that many of us welcome the inclusion of the problem of drug abuse on the summit agenda again this year? Is she aware that since the previous summit conditions are still very bad and the younger generation of this country are probably as much at risk, if not more than last year, and that there is still a great deal to be done?
As a result of the action at the previous summit, we have received a report on drugs during the year. My hon. Friend is aware that we are taking action in our own countries. He will know what is being done here, and I am sure that he will applaud it and the work of the Home Office. We are also taking international action to see whether we can obtain intelligence of cargoes that would be coming to this country. We have a number of Customs officers in other locations in the world where drugs are produced, and that is proving very effective. My hon. Friend will also know that many drugs have been seized at London airport. I do not say that complacently because we must continue with our plans and activities most vigorously because this is a terrible trade.
No. I do not think that the hon. Gentleman or any other hon. Member can do other than accept the fact that in this country civil nuclear power has an excellent record. There has been no fatal accident. It is a vigorous industry and, provided that we keep up our careful monitoring of design, manufacture, operational work and maintenance and our excellent nuclear inspectorate, we can continue to have confidence in that industry, which was born in this country.
Is my right hon. Friend aware of the general welcome for the statement about co-operation in relation to international terrorism? Does she agree that had she not taken the action to support the Americans in their moves against Libya the present international agreement about international terrorism, limited but welcome though it is, is unlikely to have been made?
Had we left things as they were with the proposed statement at the beginning, it would have been grossly inadequate and it would have been seen to have been grossly inadequate. We felt that it was important that we should take more peaceful ways to try to combat terrorism and that we should enumerate those, not just have a general statement, and that we should be seen to be prepared to take further measures. It was as a result of the action of this country that we got that statement in the end from a totally united set of summit countries.
Does not the Prime Minister think that many in the House will find it surprising that there was no indication in her statement that the problems of world hunger and development had been discussed, let alone any positive action proposed to alleviate the hunger of one starving child? Does she not think that, whatever other important matters should appear on the agenda at such meetings, the fundamental problems of world hunger and development should appear automatically when the leaders of the world's richest nations meet?
Yes. If the hon. Gentleman looks through the economic communiqúe he will find the matter referred to. He will find Africa singled out for special attention, as he would expect, and he will also find that we discussed the replenishment of the IDA funds which are at present under consideration. The hon. Gentleman will not find a particular sum mentioned except that we agree that there must be a substantial replenishment. He will know that this country is prepared to play its full part in that and I believe that other summit countries will do the same.
I congratulate my right hon. Friend on her achievements at the summit. However, was she not somewhat dismayed by how difficult it proved to be to persuade the French President to agree to the robust wording of the communiqúe on terrorism? Did she notice the admiring published comment of the United States Secretary of State in that context? He said:
Margaret really wrestled Old Francois to the mat on this one.
Will that sort of wrestling have to continue in order to. keep the EEC sound on terrorism?
I deny that absolutely. It was realised that we took a robust line on terrorism and on enumerating and detailing more peaceful measures, and that was right. Gradually other summit countries came along and we added further things to the communiqúe. In the end, we had considerable co-operation from all summit countries and the entire communiqúe was agreed.
We have difficulty with our naval ships entering New Zealand ports because of conditions it has laid down. The Prime Minister of New Zealand is very much aware of that. I have also told the Prime Minister of New Zealand that we shall continue to fight in this country for a fair deal for New Zealand in the Community because we know very well that many of its products, especially lamb and butter, are vital to the future of its economy.
Since point 9 of the official communiqué committed the summit leaders to maintain and, where appropriate, expand official financial flows to the developing countries, what consequences for United Kingdom policy does my right hon. Friend see flowing from that commitment?
When my hon. Friend asked that queston it so happened that I had the economic communiqué open at that page. It says that private financial flows will continue to play a major part in providing for their development needs. That is correct, and my hon. Friend is aware that we have constantly emphasised that such financial flows are very valuable to the developing countries. We also insist that in the GATT trade round we must consider the rules for direct foreign investment in other countries as that can be very helpful to those countries. We also hope that the private financial flows from this country, which fell a little last year, will increase once again.
Is the Prime Minister aware that, by and large, the British people will see through the hypocrisy of the so-called statement against terrorism, robust though she declares it to be, in the absence of any action to be taken by the Government against the British banks trading with Libya? Did she, for instance, put forward a simple proposition that, in order to combat terrorism, she would be calling upon all the Tory Members who hold directorships with companies trading with Libya to give up those directorships? Did she say, for instance, that she had sent a letter to the chairman of the Tory party telling him that, if money for Tory party funds was received from companies that are trading with Libya, it should be sent back? Unless she does things such as that, the British people will see through the hypocrisy and understand that this Prime Minister is more concerned with making profit and less concerned with the lives of innocent men, women and children in Libya or elsewhere.
In view of the specific nature of some of the decisions made, is not a weakness of the summit system the fact that there is no continuing organisation to implement decisions? After all, is it good enough that there should be meetings at intervals but nothing in between to ensure that the decisions are carried out, co-ordinated and monitored?
I am aware of the point that my hon. Friend raises. We attempted to do something about it in relation to the economic side of summit life. He will see from the communiqué that in certain circumstances the five nations that call themselves G5 are to meet at all seven summit countries—which call themselves G7—on economic and exchange matters. I believe that that is a great improvement that will help. We are also aware that it would be advisable if from time to time in the interim the Foreign Ministers met, because this is one of the few organisations that girdles the world in its membership.