47. In particular, the development and exploitation of modern industria technology, upon which so much of our employment and income increasingly depends, requires greater resources for research and development and wider markets than any one Western European nation can provide. The different national systems of corporate law and taxation in Western Europe make it difficult for European firms to combine and co-operate effectively to meet competition from the great firms whose resources are based on the much larger home markets of the United States and, more recently, of Japan. In recent years Western European markets for jet aircraft and aero engines, for computers and advanced electronic equipment, for nuclear fuel and power, for motor vehicles and for many other products have been increasingly dominated or penetrated by the much larger international corporations based outside Europe. Together, the Western European nations can organise themselves to compete with these giants, which are otherwise bound to go on increasing their share of European industrial markets.
48. If we enter the Communities we shall be able to profit from the general advantages of a larger market and, in particular, to play a full part in the development of industries based on advanced technology. If we do not join, we shall forgo these opportunities which the members of the Communities will increasingly enjoy. Their industries will have a home market of some 190 million people, with preferential markets in other European and overseas countries. Our industries would have a home market of some 55 million people, with perhaps another 45 million in EFTA, as against the home market of some 290 million people we should have if we joined the Communities.
EXPERIENCE OF THE SIX
49. The economic growth of the Six countries had already been considerable in the 1950s, as they recovered from the disruptions of war and occupation. The formation of the European Economic Community then created an environment within which they have each made further and striking progress over the past decade. In considering the likely effect upon our economy of membership of an enlarged Community we must first examine the evidence of that decade.
50. The members of the Community created a common market in industrial goods by steadily eliminating the tariffs on imports from one another over the years 1959-68. The abolition of tariffs provided a strong and growing stimulus to the mutual trade of Community countries. It is estimated that by 1969 the value of this "intra-trade" in manufactured products was about 50 per cent higher than it would have been, had the Community not been formed; moreover it appears that the stimulus to intra-trade is continuing. The abolition of tariffs and this consequent increase in intra-trade were accompanied by important changes in the performance of manufacturing industries in the Six countries. Those industries which competed with imports faced an intensification of competitive pressure as tariffs fell, obliging them to seek ways of raising efficiency and reducing costs. By the same token, prospects for exporting dramatically improved. Import competition and export expansion were closely associated with a growth in investment. The outcome of these processes was a significant improvement in the rate of growth of
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