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5.
DSR 11C
It is the second largest direct investor overseas after
the US (though the FRG is catching up fast) and around
one fifth of this investment is in LDCs. The pattern
of trade also makes for vulnerability: the UK tends
to run trade surpluses with LDCs, while its trade
deficits are weighted towards developed countries such as
the US and Japan (though this is equally true of France
and the FRG). Admittedly Britain's oil riches make it
less dependent on the Middle East than its fellow
members of the EC. But it remains vulnerable on the
export front, as Saudi Arabia's recent hostile economic
action demonstrated, and could still be subjected to
financial pressures.
9. Britain is not the only developed nation to have
faced trade sanctions (see Appendix B). But there are
a number of reasons, apart from Britain's obvious
vulnerability, why countries may be more willing to take
such action against us. Within the North-South dialogue
the UK is seen as more hawkish than other developed
nations, apart from the US, and on specific trade issues
such as textiles it tends to adopt a relatively
protectionist stance. The colonial past can still give
rise to resentment. And the UK media enjoys a wider
circulation around the world than the non-anglophone
media and may thus give wider offence when Third World
countries and leaders are criticised. By contrast,
France's determinedly protectionist leanings in agriculture
and its colonial past appear to have been less troublesome,
in the present context. It is worth noting, too, that the
FRG adopts a conspicuously liberal approach on trade issues. It does not hesitate to boast about it to the
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