Manufactured Goods

Oral Answers to Questions — Trade and Industry – in the House of Commons at 12:00 am on 13th January 1988.

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Photo of Dennis Canavan Dennis Canavan , Falkirk West 12:00 am, 13th January 1988

To ask the Chancellor of the Duchy of Lancaster what is the latest balance of trade in manufactured goods.

Photo of Mr Alan Clark Mr Alan Clark , Plymouth, Sutton

In the first 11 months of 1987 there was a deficit on trade in manufactures of £6·5 billion.

Photo of Dennis Canavan Dennis Canavan , Falkirk West

Will the Minister now tell us the whole truth, which is that his Government have managed the remarkable feat of turning a surplus of over £5 billion in 1978 into a deficit of over £6 billion in 1987, that this deficit is the worst ever recorded in Britain's industrial history and that it is a direct consequence of the abysmal failure of the Government's economic and industrial strategy?

Photo of Mr Alan Clark Mr Alan Clark , Plymouth, Sutton

It is not a function of economic policy at all. In fact, half the deficit is comprised of semi-manufactures and intermediate finished manufactured products which are used for production in this country and contribute to employment. Approximately the other half is accounted for by consumer choice. The Government are not some giant purchasing agency on behalf of the British consumer. Why does the hon. Member not speak to his own constituents? Why does he not ask them why they prefer foreign goods? Why does he not admonish them? It would not put his vote up, but he might learn something from it.

Photo of Mr John Marshall Mr John Marshall , Hendon South

Does my hon. Friend agree that the best hope for manufacturing industry is the creation of a genuine internal market in Europe by 1992?

Photo of Mr Alan Clark Mr Alan Clark , Plymouth, Sutton

The creation of the internal market will give us a consumer market of some 330 million people. It will be the largest in the world, larger than the United States or Japan. Progress is being made towards the removal of barriers, which should bring about that market by 1992. The Internal Market Council on which I represent the Department, meets every month in Brussels or Luxembourg.

Photo of Mr James Lamond Mr James Lamond , Oldham Central and Royton

Is the Minister aware that the textile industry's contribution to the balance of trade will be severely damaged by the recent very liberal agreement reached with Turkey on the import of yarns into this country, which appears to me to undermine the MFA of which he spoke so warmly a few minutes ago? Is his Department looking at that?

Photo of Mr Alan Clark Mr Alan Clark , Plymouth, Sutton

I have looked at it very closely and would be very glad to do something about it, but unfortunately the industry cannot produce evidence of injury. If it produces evidence of serious injury, it will enable me to take action to reduce the volume of imports from Turkey. I have been at great pains to try to secure such evidence, but none has been forthcoming.

Photo of Mr Michael Latham Mr Michael Latham , Rutland and Melton

Is my hon. Friend aware that Conservative Members, at any rate, do not take the stone-age view that nothing matters but manufactured goods? We are surprised that Opposition Members have no interest in the output of hundreds of thousands of people who work in tourism, insurance and many other non-manufacturing industries.

Photo of Mr Alan Clark Mr Alan Clark , Plymouth, Sutton

Yes, that is true, but I will not go the whole way with my hon. Friend. I attach great importance to the performance of manufacturing industry and I regret very much that we are still in deficit in that sector. It is the only sector in our whole trade balance where we are in deficit. I am optimistic that it will slowly be corrected, because exports are rising faster than imports, but I attach importance to the sector and I do not believe that the service sector, however successful and however many people it employs, can ever be an effective substitute for it.