2
7 July 1982]
MINUTES OF EVIDENCE TAKEN BEFORE
[Continued
extraordinarily rapid progress towards becoming a developed country is evident from the capital-intensive industries which are now established there and from the expanding services which make the most of its geographical position as a focal point of trade and transport in South East Asia. Singapore maintains a liberal and open import regime.
6. A note on the individual markets is attached at Annex B.
(B) ASEAN COUNTRIES INTEREST IN UK MARKET
7. Following several years of small surpluses, the UK had a slight deficit in trade with the ASEAN countries in 1980 (arising partly from substantial and unusual imports of gold from Singapore see Annex C II). Excluding these gold imports, about 1 per cent of the UK's total imports came from these countries (£573 million) representing some 21 per cent of the ASEAN countries (£573 million) representing some 24 per cent of the ASEAN countries exports (excluding trade among themselves). The level of trade varies, of course, from country to country but the pattern of trade is similar for the four larger countries. Agricultural and plantation products (particularly rubber, vegetable oils and fats, wood and cork manufactures) form the bulk of their trade with the UK but the level of manufactured products in their exports is rising and, by value, now accounts for about one third of the total they send us.
8. All the ASEAN countries ar eligible to benefit from the EC's Generalised Scheme of Preferences (GSP) which allows duty free access for most industrial products (with limits on some products sensitive to Community industries), and preferential access for a limited range of agricultural products. The ASEAN countries would like to see improvements in their preferential access (eg for plywood) although there is scope for them to make better use of the preferential access they have already under the GSP.
9. The EC restricts access for textiles and clothing under the Multifibre Arrangement (MFA). Imports of a few industrial products (such as consumer electronics) and a few agricultural products (such as manioc) are also effectively limited by other arrangements. The ASEAN countries would, of course, like to see restrictions removed. They contend that without improved access for their exports to developed markets, their development will be retarded and they will be less able to buy the capital goods we, in Europe, wish to export. The main counter-arguments frequently voiced and well understood are that the Community is essentially committed to free trade; that it recognises fully the need for trade to be in both directions; that its industry is constantly adjusting to new economic conditions; and that the real issue is about the pace of change rather than the need for change. However, where there is a need formally to regulate imports the levels are negotiated centrally by the European Commission on behalf of the Member States as part of the common commercial policy.
10. A break-down of UK imports from the ASEAN countries is included in Annex C I.
(C) UK EXPORT PERFORMANCE IN THE ASEAN COUNTRIES
11. In 1980 some 2 per cent (about £850 million) of UK visible exports went to the ASEAN countries - - Annex C II, shows the broad classification of our main exports. A comparison of the UK's level of visible exports with the levels achieved by the other main supplying countries is shown at Annex C III. The ASEAN countries are also an important market for banking, insurance, shipping and other invisible exports.
(D) UK GOVERNMENT ROLE
12. The remarkably rapid development of the ASEAN countries was getting under way in the 1970s when British companies were setting their sights on the new opportunities offered by the EEC and the Middle East. Apart from a few notable exceptions, British companies were generally slow to recognise, particularly in Indonesia, the Philippines and Thailand with which our traditional links are less strong, that a new and sustained surge of growth had begun. This coincided with the emergence of Japan as a powerful competitor
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