HC Deb 26 July 1993 vol 229 cc816-36

8.2 pm

Mr. John Wilkinson (Ruislip-Northwood)

It is an honour to open the Consolidated Fund debate this evening with a debate on Britain's relations with Latin America. At the outset, I must declare an interest. My company, which is listed in the Register of Members' Interests, does business with Latin America.

Owing to the accident of family circumstances, I take an intense personal interest in the region. When democracy was restored in Chile, I was instrumental in restarting the Chile all-party group in Parliament, which I now chair. The cause of improving relations between parliamentarians of Latin America and of the United Kingdom is well served in the House by the various parliamentary groups for the region, and especially by the umbrella British-Latin American parliamentary group, under the chairmanship of my hon. Friend the Member for Wycombe (Mr. Whitney), who is an old Argentina hand from his days in Her Majesty's embassy in Buenos Aires.

The British-Latin American parliamentary group holds, in June, an annual parliamentary seminar at Canning house and hosts visits to Parliament of distinguished high officials from Latin America, the next one of which will be tomorrow morning by His Excellency Senor Cesar Gaviria, the President of Colombia, whom we warmly welcomed to the United Kingdom today.

Dr. Charles Goodson-Wickes (Wimbledon)

May I heartily endorse my hon. Friend's welcome to President Gaviria of Colombia. The House will recognise that his visit could hardly be more appropriate, following that of my right hon. Friend the Prime Minister to Colombia, the first visit ever by a serving British Prime Minister to a south American country.

Will my hon. Friend join me in welcoming proposed visits by the Minister of State, Foreign and Commonwealth Office, my hon. Friend the Member for Wells (Mr. Heathcoat-Amory), who is on the Front Bench tonight, and other Ministers, and, above all, the proposed visit by Madam Speaker during the recess to endorse this country's long friendship with Colombia, its long tradition of democracy and the new constitution that was initiated by President Gaviria?

Mr. Wilkinson

I am most grateful to my hon. and gallant Friend, who knows Colombia particularly well. I am sure that right hon. and hon. Members will have taken note of what he said.

My hon. Friend the Member for Gravesham (Mr. Arnold), who lived and worked in Brazil and travelled through most of Latin America before being incarcerated in this place, organises an active programme of meetings and lunches with Latin American ambassadors, Ministers, parliamentarians and officials.

We have the closest links with the other place, too, through the distinguished patronage of Lord Montgomery of Alamein, the president of Canning house, Lady Hooper and many other Latin American experts, some of whom, like Viscount Torrington, have led trade missions to the south American sub-continent.

The link with Canning house is of great importance to us in Parliament. Canning house is a unique forum for the study of the politics, business, society and culture of Latin America. Less specialist than the International Institute for Strategic Studies and more focused than Chatham house, it is an invaluable source of information about Latin America, fulfilling, above all, a unique commercio-diplomatic role which is of inestimable value to London as a centre of Ibero-Latin American interests.

Ministers, to their credit, recognise this as well. The Minister of State, my hon. Friend the Member for Wells, whose presence I welcome on the Treasury Bench, made a particularly well-received debut speech to our parliamentary seminar at Canning house on 30 June.

Canning house has been directed by a succession of distinguished former ambassadors to the region, the present incumbent being Sir Michael Simpson-Orlebar, who served as British ambassador in Portugal and Mexico. Funded jointly by individuals, corporate subscribers and the Foreign and Commonwealth Office, it fulfils a quasi-diplomatic role at minimal cost to the Exchequer and represents outstanding value for money to the Foreign and Commonwealth Office and the British business community. As its 50th anniversary approaches, the Foreign and Commonwealth Office would do well to confirm that the grant to Canning house is not at risk.

When addressing a theme as broad and deep as Britain's relations with Latin America, it is easy, when describing British policy towards a region that is not given to understatement, to get carried away by the grandiloquent treatment of what are necessarily inspiring themes, like the blue of the Pacific, the white of the snow on the Cordillera and the red blood of the heroes, as symbolised on the flag of Chile.

The heroics of the founders of the independent republics of south America may inspire us, but we must address the future of the United Kingdom's relations with the region in the context of British history and the development of British trade with the area.

From the ending of the Napoleonic wars to the great war, Britain played a key role in the south American liberation struggle with Spain and dominated the development of the Latin American sub-continent economically and, in many senses, industrially. British capital and entrepreneurs opened up the pampas of Argentina, laid down the railways throughout the southern cone and were active in shipping, insurance, banking, mining and the export of wool, meat and a wide range of primary products to Britain. In return, British manufacturers had a predominant position in south American markets.

Today, although the United Kingdom is still the leading European investor in Latin America, our exports to the region have remained fairly static over the past few years at £1.2 billion. However, probably as a consequence of Britain's leaving the exchange rate mechanism last September, which allowed a realistic valuation of the pound, Britain's exports to the region have risen by more than 22 per cent. in the first quarter of this year.

To my knowledge, the Latin American trade advisory group, local chambers of commerce like the London chamber of commerce, and national chambers of commerce like the British Chilean chamber of commerce all do an excellent job in furthering growing trade between the United Kingdom and Latin America, and so do our embassies throughout the region.

Ministers have also played their full part in increasing British awareness of the importance of the region as my hon. Friend the Member for Wimbledon (Dr. Goodson-Wickes) so rightly reminded the House. As my hon. Friend told us, the process began with the visit of my right hon. Friend the Prime Minister to Colombia and to the Earth summit in Rio. There were also visits by my right hon. Friend the Foreign Secretary to Argentina and Chile and by my right hon. Friends the President of the Board of Trade and the Chief Secretary to the Treasury to Mexico, Argentina and Chile.

My right hon. Friends made it clear, and this has always been the Government's consistent policy, that there is no incompatibility between British insistence that the sovereignty of the Falklands islands is not an issue and the maintenance of Britain's interests throughout the region. On the contrary, I believe that our presence in the Falkland islands is an important strategic interest which physically demonstrates our concern for the region. It provides a counterbalance to international relationships in the southern cone, it protects passage around the horn and it demonstrates our concern for Antarctica, its resources and for the environment of the southern seas.

However, British exporters must overcome their obsession with markets in the EEC, where we have a trade deficit with all the member countries except Ireland, Spain and Greece, and turn to the growth regions such as Latin America and the Pacific basin. Latin America is well placed to trade with Europe and the Pacific nations. We must ensure that Latin America looks more to Europe, its traditional focus, than to the Pacific basin exporting nations—although we would not think that it did when we see the number of Japanese cars in Santiago

The growth of the leading economies of south America far outstrips that of the EEC nations, although the economies of south America are, of course, much smaller. For example, the rate of growth in Chile last year was 10.4 per cent. For the region as a whole, even including Brazil which suffered recession, recorded growth was 2.6 per cent. last year. Without Brazil, growth rose by 4.3 per cent. There were growth rates of above 5 per cent. in Argentina, Chile, Costa Rica, the Dominican Republic, Guyana, Panama, Uruguay and Venezuela.

An engine for growth in the region has been domestic investment which increased by more than 10 per cent. in six of the aforementioned countries in 1992. Furthermore, net capital inflows to the region from abroad have grown from $8 billion in 1989 to $54 billion last year. At the same time, the burden of external debt has generally diminished.

The regional ratio of interest payments to exports fell from 37 per cent. in 1986 to 20 per cent. in 1992. Only six countries in the region registered increases in inflation last year. In short, with the notable exception of Brazil, most of the principal nations of Latin America, which are significant potential markets for the United Kingdom, saw sustainable growth for the third year running allied to reasonable price stability. Only terrorism remains a nagging problem, especially in Peru and, to a much lesser extent, in Colombia. It is a scourge of contemporary humanity that mercifully appears to be coming gradually under control.

It might be assumed that, with European and north American markets so depressed and with Latin American markets buoyant by contrast, and with no regime in the region seriously out of line from the democratic free enterprise model apart from Cuba, British exporters would be falling over each other to exploit the trade opportunities of the region. Those opportunities are indeed considerable, as I have explained.

We should take into account, especially in this connection, the British experience of privatisation and of financial services and the commercial efficiency of our privatised utilities such as water and gas. Those experiencies enhance the business opportunities for British exporters throughout the region.

When George Canning proudly wrote, upon the liberation of Spain's south American colonies and their emergence as independent states, that: The deed is done. The nail is driven. Spanish America is free and, if we do not mismanage our matters sadly, she is English", we could not have a better example, even 150 years or so on, of the opportunities that present themselves today to the United Kingdom throughout the region—that is, if Her Majesty's Government do not interpose obstacles or impediments to the development of this potentially extremely fruitful trade.

I can list some potential stumbling blocks which should be discreetly removed. The first is the elimination of Portuguese from the GCSE syllabus. That seems crazy. Brazil accounts for 40 per cent. of the Latin American economy.

Mr. Jacques Arnold (Gravesham)

My hon. Friend may be interested to learn that, following much pressure by Canning house, members of the British Latin American parliamentary group in this House and many others, the London examining board has restored the examining of Portuguese at GCSE level.

Mr. Wilkinson

I am grateful to my hon. Friend and I am sure that everyone will appreciate his personal efforts in the matter. He is the leading Portuguese speaker in the House and I am sure that he campaigned especially hard.

Another potential stumbling block is the elimination of key posts in British embassies such as that of defence attaché at our embassy in Ecuador or the downgrading and paring of British missions which militates against Britain's interests to strengthen diplomatic and commercial efforts throughout the region. In addition, the process militates against the provision of the maximum assistance to British business men in what is all too often for them still unfamiliar territory. If reductions in diplomatic manpower are necessary, they should occur in EEC countries with whom we are supposed to be moving towards ever-closer union.

We must also consider the malign effects of the European Community's common agricultural policy. I will let others address the current EC banana regime. However, curtailing European imports of Chilean apples seems daft to me as is the CAP policy which militates against our importing succulent cheap Argentine and Uruguayan beef in favour of expensive, scrawny European meat.

However, I regret to say that every now and again a cause celebre erupts out of a blue sky to prejudice years of political and commercial effort and it does so in a way which could seriously damage the normally outstanding good relationships between the United Kingdom and a Latin American country. A case in point is the orimulsion issue, whereby Her Majesty's Government are seeking to impose duty on the import of Venezuelan-produced bitumen transported in suspension with water, and to persuade the European Community to classify it as a mineral oil. Coal and water slurry does not become something different just becasuse a water-based suspension is required to transport coal down pipelines, nor does bitumen lose its qualities as bitumen if mixed with water. The British case is, I regret, disingenuous to say the least. I have seen the minutes of the relevant EEC committee, and the United Kingdom is unnecessarily in the minority of one on the issue.

Mr. Allan Rogers (Rhondda)

Does the hon. Gentleman accept that orimulsion is considered by many to be an extreme pollutant when burnt in power stations, as is proposed?

Mr. Wilkinson

That is not the case. It produces more suphur dioxide, but, in every other aspect, the combustion of orimulsion produces fewer noxious emissions than that of oil or coal.

The issue is potentiallly prejudicial to a British-Venezuelan joint venture company, BP Bitor, which makes the product, and to our trade with Venezuela, which the Department of Trade and Industry, following an admirable initiative of my right hon. Friend the Member for St. Albans (Mr. Lilley), the Secretary of State for Trade and Industry, has been a target country for British exporters. The United Kingdom should accept European Community proposals on the matter and come to an accommodation with Venezuela, or I fear that the United Kingdom will risk the widening and deepening of a wholly unnecessary dispute.

I now refer to Export Credits Guarantee Department cover. To his credit, the previous Chancellor, my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont), announced an extra £1.2 billion for ECGD cover in his last Budget statement. However, the ECGD's portfolio management systems criteria for local risk and premium pricing do not accord with present south American realities.

Rightly, Chile has competitive ECGD premium rates, under the Government of President Aylwin, as under their predecessor, and the country has maintained essentially sound economic policies. However, in markets of immense potential for British exports, such as Mexico, Colombia, Venezuela and Argentina, British ECGD premium rates are far higher than those for export credit guarantee cover available to firms in our competitor countries. The matter should be rectified, and I hope that my right hon. and learned Friend the Chancellor of the Exchequer will do so in his Budget statement of 30 November.

The House has always taken an interest in Latin America. It might be a minority interest, but on occasions it can be of great influence, as was the role of a former Member for Westminster, Lord Cochrane, who was wrongly expelled from the House, from the Navy and from the Order of the Bath, for fraud in 1816 and who went to Chile and founded the Chilean navy. His capture of the Spanish flagship Esmeralda in Callao harbour contributed largely to the independence of Chile and Peru. In the House of Commons of those days, his contemorary, James Mackintosh, said: There has never been a major demonstration of judgment, wisdom and action capability than the one demonstrated on that occasion. Few of us have such a eulogy addressed to anything that we do, but few of us are in Admiral Lord Thomas Alexander Cochrane's league for originality and for courage. However, if we share but half of his love of liberty, we will have served our country well and, I hope, south America, too.

8.24 pm
Mr. Jeremy Corbyn (Islington, North)

I am pleased that we are debating Latin America, as we seem to do every July. It is a good tradition, because that area of the world is not sufficiently discussed. My problem with the speech of the hon. Member for Ruislip-Northwood (Mr. Wilkinson) is that I do not agree with the philosophy behind it. The problem is that, in his heroic moves to liberate Latin America from the clutches of the Spanish, what George Canning was about was liberating people from the Spanish in order to put them under another colonial power. He was not talking about the liberation of Latin America.

Indeed, the regimes that followed the George Canning liberation movement were essentially elitist regimes of the settler community. They did much to oppress the indigenous population. Indeed, many practised wholesale genocide against the indigenous population of south America. The Spanish conquistadors and their move into Peru and what was later to be called Bolivia were unbelievably brutal, but the regimes that followed were also brutal towards the indigenous population. Indeed, that brutality continues today towards large numbers of indigenous peoples living in the Amazonas region, in particular. We should remember that. The reason why it did not become a massive British colony was that the British and the United States agreed on the Monroe doctrine and then calmly divided up that part of the world, largely in the interests of the United States.

The other aspect on which I disagree with the hon. Gentleman—he will not be surprised, because we have had this discussion many times—is his glib description of democracy and free enterprise as synonymous, equal and mutually dependent. Many Opposition Members simply do not accept that. When we saw the brutality of the free enterprise model under General Pinochet, there was not an awful lot of democracy in Chile at that time. There was great free enterprise. There was also great brutality in the promotion of the free enterprise model, supported by the World bank and the International Monetary Fund in many other parts of Latin America.

Indeed, it is 10 years or so since the great debt crises of the early 1980s, when the Latin American Parliament as a whole voted for a process of refusing to pay the interest on debts, and that sent a shiver down the spine of the United States and world banking systems. That crisis was averted by a series of bilateral deals and buy-offs and, indeed, in the United States nationalisation and subsequent resale to the private sector of some banks by the Reagan Administration to prevent the collapse of that banking system. But the way in which the overseas debt burden has been reduced in Latin America has had some truly horrific consequences.

The debt burden came about basically because of the increase in world oil prices and the underpricing of primary products produced throughout Latin America. The debt-for-equity swaps that have been imposed upon one economy after another have had some horrendous consequences in terms of social infrastructure, privatisation of former state-owned institutions, cuts in public spending and the laying off of state employees, with some truly horrific consequences for the education and health services of the countries concerned. That is not the equality of free enterprise and democracy; that is the brutality of the private sector saying that it is not prepared to spend anything on public services and public infrastructure. We should be aware that many social problems of Latin America are closely related to those issues.

The other general problems throughout Latin America include enormous population movements away from rural areas into the shanty towns surrounding major cities. That is a consequence of changing agricultural systems and practice. In the case of Chile, it is a consequence of wholesale land purchases—indeed, in some cases, by multinational capital to develop high-intensity fruit farming which requires fewer workers than the previous farming practice did—and still higher levels of unemployment in the shanty towns around many capital cities of Latin America. Surrounding every capital city in Latin America is a smoking cauldron of extremely poor, extremely bitter and extremely angry people.

It might be strange for those in western Europe to note that Latin American countries have refused to pay the foreign debt because it is unpayable, unjust and uncollectable. However, those reasons are common parlance among liberal and left-wing parties throughout Latin America. It is a feature of normal political debate.

The development of the Latin American economies has caused some serious environmental and health problems. The frightening spread of cholera throughout Peru just two years ago was a consequence, in part, of the cuts in health programmes and in the development of water purification plants. That was done to please the wishes of the bankers of the north. Serious environmental concerns have been expressed about the extraction of minerals and the construction of roads throughout the Amazon rain forest and the destruction of that forest.

It would be wrong in a debate about Latin America not to mention some of the people who are truly heroic, such as Chico Mendes, who stood up for the rights of indigenous people within the Amazonas region. In effect, he was murdered by the interests of multinational capital; its future for the Amazons region was different from that envisaged by Mendes.

In the past decade things have changed considerably in Latin America. Most of the military regimes are no longer in government and there is a civilian or quasi-civilian regime in most countries. The human rights abuses that took place under the military regimes of Argentina, Chile, Honduras and Nicaragua, as well as in other countries, have not, however, ceased. The disappeared have not returned. The graves of thousands and thousands of people have not yet been discovered. They died because they were not prepared to support military regimes and because they believed in a genuine form of liberty.

Although no one can be happy with the current situation in Peru and Bolivia, there is an economic dimension to the terror. The poverty in many of the rural areas and the lack of decent prices for the primary products produced by the campesinos, particularly those in the Andean region, have turned those people to the cultivation of drugs. Drugs, quite simply, are far more profitable than the returns on maize. It is possible to make a living from growing drugs, but it is not possible to make a living from growing normal crops. Until pricing and poverty are addressed, the attempts to wage war on drugs will not be successful. I do not condone the production, distribution, sale or use of drugs—it is an evil and vile trade— but one must recognise that it has an economic logic of its own which we cannot ignore.

The hon. Member for Ruislip-Northwood referred to Chile, which I have visited on a number of occasions. In common with him, I have family connections with Chile, but I have no commercial interests in that country, or anywhere else for that matter. The situation in Chile has changed dramatically, but we should not forget that President Salvador Allende was brutally murdered in 1973 —20 years ago this year—for leading a Government who sought to oppose the power of multinational capital. He was assassinated by the forces led by General Pinochet. Some 20,000 people were killed at the start of the coup and, over the next 17 years of Pinochet's total control, 50,000 lost their lives. One million Chileans were forced into exile as a result of the terror that was wrought upon them by that brutal, fascist regime.

That regime had its apologists in Britain. It had its apologists in the House. It was one of the most brutal regimes that the world has ever known. Although the situation in Chile has dramatically improved, it is faced with serious constitutional problems. General Pinochet is still the head of the armed services and members of the armed services are still protected from any type of judicial process taken against them for denial of human rights, murders or for taking part in the disappearance of people. For example, the murder of Orlando Letelier, in Washington in 1980, led the United States authorities to call for General Contreras to be extradited. That cannot happen because he is protected by the constitution, which protects the military. It is a serious matter when someone who is known or is believed to have murdered Letelier cannot be extradited to face the judiciary in the United States.

There are still 80 political prisoners in Chilean gaols, who have been there since the Aylwin Government came to power. Since that time, another 120 people have gone to prison. They believe that they have been sent there for political reasons and that they should be released.

Although six secret prisons and cemeteries have been discovered by the human rights commission in Chile and some state compensation has been paid, all human rights abuses should be uncovered. At least those who have lost family and friends—I know those who have gone through the horror of wondering what happened to a person who was taken away in the middle of the night—would then know what had happened to the bodies of their loved ones after they were murdered by the secret police in Chile during that horrific and vile period.

During that time a Conservative Government in Britain happily supplied arms and traded with that regime. We should not forget that—it is not forgotten by many in Chile.

At the time of the Falklands war it was quite correct to criticise the appalling human rights record of the Galtieri Administration in Argentina and that of previous and subsequent Administrations. Because we are now trading with Argentina and because it was part of the coalition force in the Gulf war, there is now, apparently, much less concern in western Europe about the fate of those who disappeared.

I still receive letters and a magazine from a wonderful group of women known as the abuelas de la Plaza de Mayo. They are the grandmothers of the disappeared of the Plaza de Mayo. Those children were taken away during the Galtieri regime and it is believed that they were given to the families of officers of the Argentine army. It is horrific to think of those women looking for their families. I do not know why the hon. Member for Wycombe (Mr. Whitney) seems to find this so amusing.

Mr. Ray Whitney (Wycombe)

I do not find it amusing. What I find extraordinary is that, year after year, the hon. Gentleman replays the battles of the 1960s. He seems to have no idea what has happened since then and no interest in what has happened in the 1990s.

Mr. Corbyn

I raise this subject year after year and I shall go on doing so.

Mr. Whitney

I will be here.

Mr. Corbyn

I am glad that the hon. Gentleman will be here to listen. I shall continue to raise this subject because I believe that the issue of human rights abuses does not go away just because a different person is in Government house. If one has lost family, one has lost family. If one does not know what happened to a person, one does not know. It is perfectly reasonable that those people should want to know what happened.

We are, apparently, also concerned about human rights and so we have some responsibility to bear. All that I am saying is that those people should not be forgotten. I am not reliving all the battles of the past, but I have recognised that there is still a need for human rights and human justice. It might be convenient for Conservative Members to say that we are in the 1990s and can forget about the past, but I remember those self-same hon. Members apologising for the Pinochet regime, year after year, in debates on Chile. I intend to keep reminding them of that because that is necessary.

It is worth considering what has happened in Nicaragua since the Chamorro Government took over in 1990. The rate of unemployment in that country is now at an all-time high, as is the level of external debt. Apparently the serious environmental and economic problems are getting worse. The United States promised aid once the Chamorro Government took office, but most of that aid has not been forthcoming. Most of the European Community aid that has been earmarked for Nicaragua has been tied to specific development projects. I understand that only half that aid is now capable of being spent because there has been such a cut in Government agencies that they are now incapable of administering such aid.

Nicaragua is suffering, as almost no other country in the region has suffered, from the type of quack economics that we thought had been forgotten about with the Chicago school. Unemployment is now reaching an all-time high and there is great poverty in Managua and the other cities. We should consider giving more aid to Nicaragua to help those people to get out of poverty. They suffered enough during the civil war from the United States bombardment. If the United States would just spend a fraction of the money on development aid that it spent on bombing the Sandinistas out of existence, the people of Nicaragua would be considerably better off.

Some of us have seen at first hand the horrors of years of conflict in El Salvador. I am glad to say that it is no longer being fought and elections are due to take place. But questions have been asked in another place about the size of the disfranchised electorate, the number of serious spelling mistakes and double entries on the electoral register and the need for vigilance during registration and preparation for the election. The Foreign Office has been asked to send delegations from this country to assist and observe during the electoral registration period and the election itself. If democracy is to mean anything in El Salvador, everyone must have the chance to take part in the electoral process. I hope that the Minister will tell us the British Government's response to these requests.

On 30 August Honduras will hold a commemoration day in honour of the disappeared who vanished under former military regimes, thanks to the secret police. Before we embrace any new Government or regime we should always ask them about their human rights record and about the fate of the many people who stood up for human rights, for dignity and for trade unions and who were murdered or spirited away for their pains.

On Saturday last week the fourth meeting of the Sao Paolo forum ended. It represents more than 100 political movements throughout the Caribbean and Latin America. The last meeting took place in Havana; the first was held in Brazil three years ago. The forum brought together people who are concerned by the fact that the whole continent is in thrall to neo-liberal economics, with its attendant unemployment and obsession with market economics. They believe that there must be a better way of organising society, as do many other people all over the world.

Mr. Wilkinson

I do not want to enter into a long argument with the hon. Gentleman, but may I point out that Chile, the real forerunner of free market reforms throughout south America, has only 4.4 per cent. unemployment? No ne can say that free market economics engenders unemployment. If organised properly, free enterprise engenders prosperity; and the new Government seek to share that prosperity much more widely.

Mr. Corbyn

Granted, economic growth in Chile has been fast by any standards, but I question the basis for the 4.4 per cent. statistic. The hon. Gentleman should ask some of the voluntary agencies working near Santiago and in the poblaciones about the high unemployment there and about the informal economy. There is still serious poverty in Chile, even though unemployment there is not as high as elsewhere. There is also bad housing and had health care —and, in any case, it was never the poorest country in the region.

Today, 26 July, is an historic day for Cuba: an important national day. In 1959 Cuba was one of the poorest countries in the region, with the highest degree of illiteracy and the most serious social problems. Today illiteracy has been conquered and Cuba has a low infant mortality rate and high standards of educational achievement—despite a rigorous blockade by the United States throughout the period. Owing to the break-up of the Soviet Union and the Comecon trading block, and Cuba's inability to trade as before with eastern Europe and the USSR, it faces serious problems, as my hon. Friends who have visited the country more recently than I have can testify.

It cannot be right that the blockade should include food, medicines and fuel, aimed at breaking up the very infrastructure of life. The British Government have always allowed trade with Cuba but never encouraged it. I hope that they will at least recognise that it is wrong to starve the population of Cuba unti they agree to a change of political course. There is not much sign of the people of Cuba wanting such a change; there is every sign that they would like to live in dignity and independence. So I hope that the British Government will bring what pressure they can to bear on the United States Adminstration to lift the blockade so that the Cubans can at least enjoy a reasonable standard of living.

Running through many people's attitude to Latin America is the belief that western Europe and the United States can impose an economic system and way of life on the continent. They fail to understand the anger beneath the surface, not among the political elite of the region but among people who will no longer tolerate the impoverishment of parts of the continent, particularly of those living in the shanty towns around major cities.

I welcome trade with Latin America. We should recognise that, for a long time, many workers in farms and factories there have been grossly underpaid for their efforts. If there is any justice in the world, much more debt must be written off and much fairer trading arrangements with the continent must be agreed.

I believe that poverty, oppression and human rights abuses go together. We should do what we can to alleviate all three horrors, which for too long have been visited on the people of Latin America.

8.46 pm
Mr. Jacques Arnold (Gravesham)

I congratulate my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) on initiating the debate, which is becoming something of a tradition in the House every July.

This has been a good year for Latin America: democracy has been sustained, despite the pressures sweeping the world. In Brazil, the impeachment of President Fernando Collor de Mello on corruption grounds has been carried out in a constitutional manner with his replacement by Vice-President Itamar Franco. In Venezuela the same progress has happened, with the suspension of President Carlos Andrés Perez to face charges of corruption. He has been replaced as an interim measure by Senator Ramόn José Velásquez.

In Peru the duly elected President suspended the Congress in what has been termed a new process of self-coup. In the face of pressure from within Peru and from the international community he has backed down and the Congress has been superseded by a newly elected Congress, thereby restoring democracy to Peru. That example may have caught on. Indeed, President Serrano in Guatemala did likewise, suspending the Congress and the constitution, following which rapidly applied pressure led to his resignation and replacement by Ramiro de Léon, the human rights ombudsman of his country. So democracy, despite all the pressures, is safe and well in Latin America —with the notable exception of Cuba.

Mr. John McAllion (Dundee, East)

The hon. Gentleman will be aware that before and during the election in Cuba last February a widespread campaign organised by Cuban exiles in Miami and by American-owned television and radio stations urged the Cuban people to destroy their ballot papers or not to vote. In the event, 80 per cent. of those entitled to vote came out and supported the regime run by Fidel Castro. The hon. Gentleman should reflect for a moment on the fact that the Government whom he supports have never had the support of more than one third of those entitled to vote. He should be hesitant before decrying Cuba's lack of democracy—it has more democratic legitimacy than this Tory Government have.

Mr. Arnold

I should have been much more impressed if candidates other than those approved by communist party committees had been allowed to stand. I shall return to that issue in a moment.

Mr. Whitney

Will my hon. Friend also invite the hon. Member for Dundee, East (Mr. McAllion) to consider why, if that is the case, at the recent conference in Brazil every other Government leader in Latin America, and the presidents of Portugal and Spain, urged President Castro to introduce democracy to Cuba at last?

Mr. Arnold

The reason is that what is continuing to happen in Cuba—the only unreformed Marxist communist regime in the world, other than one in Asia, I believe —is a blot on the democratic escutcheon of Latin America and is a disgrace.

On the question of economics in Latin America, it is notable that, after a decade of stagnation, recovery is under way. My hon. Friend the Member for Ruislip-Northwood catalogued the impressive growth in gross domestic product throughout the continent. Trade liberalisation has led to far greater activity and markedly increased imports, which has to be good for Britain's opportunities, but only modest increases in exports. The resultant trade deficits could, indeed, cause an economic crisis in Latin America.

The growing protectionism in the United States and Europe is dangerous, which is why this country's efforts for a successful completion of the Uruguay round of GATT is so appreciated in Latin America and is also vital to it. It would be a tragedy were there to be a return in Latin America to the tried and failed policies of import substitution.

It has been a good year for Britain's relations with Latin America. Our right hon. Friend the Prime Minister visited Colombia. He visited Cusiana, one of the largest oil discoveries of recent years, and he also visited Brazil for the Earth summit and held bilateral meetings with the Brazilian Government. Our right hon. Friend the Foreign Secretary recently visited Argentina and Chile, and our right hon. Friend the President of the Board of Trade has been to Mexico and Argentina and spoke of his impression of the development and sophistication of both countries.

Other Ministers have also visited Latin America in recent months or are due to he visiting it during the recess, joined by Madam Speaker. Ministers have been ably supported in their visits by our embassies. I counsel my hon. Friends at the Foreign Office not to impose false economies by closing or reducing our diplomatic and trade missions in Latin America.

In the other direction, we have been visited by President Lacalle, a splendid anglophile friend of this country. We are honoured this week by the visit of President Gaviria of Colombia, who will visit the House tomorrow morning for discussions with members of the British-Latin American parliamentary group and other right hon. and hon. Members. There have been visits to this country and to this Parliament by delegations of parliamentarians from Mexico and Brazil and countless Latin American Ministers and political leaders.

The greatest credit for the improvement in our relations goes to my right hon. Friend the Member for Watford Mr. Garel-Jones), who, until his retirement, gave three great years to strengthening British-Latin American relations. His greatest strength has been his natural empathy for Latin Americans, derived from his command of the Spanish language, which greatly enhanced our relations with the Hispanic countries in particular. I wish the new Minister, my hon. Friend the Member for Wells (Mr. Heathcoat-Amory), well in his task, not least in following my right hon. Friend the Member for Watford.

However, if my right hon. Friend the Member for Watford had a fault, it was his propensity to give to the only non-hispanic major country in Latin America—Brazil—far less weight than it deserves. For that reason, the remainder of my remarks deal with the importance of Brazil.

Of the 24 countries of Latin America, Brazil covers more than one third of the area. It is the ninth largest economy in the world. Its annual GDP is US$500 billion., which is three times that of Mexico and more than twice that of Belgium. The economy of the state of Sao Paulo alone is one and a half times that of the entire Republic of Argentina. We must put Brazil's importance into perspective.

Although concerns are rightly expressed about the high rates of inflation suffered in Brazil, they are not a new phenomenon. Over the decades, Brazilians have learned to live with them and, indeed, how to prosper. In recent years, Brazil has resumed the servicing of its foreign debt and has built up current foreign currency reserves of almost US$25 billion. For many years, it has run a significant trade surplus. Recently, its trade surplus was exceeded only by those of Japan and Germany. This year, it is expected to reach US$20 billion—if only we had such a surplus. Brazil's growth this year is forecast to be 3.5 per cent. which, in real terms, is a very significant increase in such a vast economy.

How is Britain participating in such vast growth? We have a long tradition of co-operation with, and investment in, Brazil, going back to independence early in the previous century. Brazil's public utilities owe much to their British founding fathers. We have long been a supplier of capital goods and technology, but we must continue to participate in great projects in that country.

I draw to the House's attention some projects currently under consideration: the Bolivia to Sao Paulo state gas pipeline, which is worth billions; the cleaning of the Tietê river, which serves the state of São Paulo; the development of the Tietê-Paraná waterway, which links up to the whole waterway system which descends to the River Plate; and the modernisation of Brazil's ports.

British industry's difficulties in competing for a part in such projects is the lack of cover from the Export Credits Guarantee Department, in competition with cover available to our competitors from their national credit insurance agencies. Companies can compete, as Westland showed by achieving the contract to supply eight Lynx helicopters to the Brazilian navy and to recondition its current fleet of such helicopters. It could only be done, however, with the financing support of the Banco do Brazil. We cannot rely on its being achieved on each and every occasion.

These difficulties are not confined to Brazil alone. The new ECGD criteria are hampering British trade throughout Latin America. The ECGD has announced cover for Argentina, Chile, Colombia, Mexico, Uruguay and Venezuela but, even then, small British exporters cannot obtain access to that cover due to ECGD's need for bank guarantees and the lack of existing lines of credit. In particular, it works against small exporters pursuing credits of between £50,000 and £250,000. There have been too many examples recently of British groups having to source through foreign countries to obtain credit cover. I cite two examples.

The first involves GEC Alsthom. Due to the better deal offered by Coface, the French Government export credit department, its recent project to supply electricity generating units to Mexico had to be channelled through its French associate. Secondly, the project by Biwater at Puerto Vallarta in Mexico had to be sourced from Spain due to the better conditions offered by its Government's export credit agency. High on our Government's European Community agenda must be the standardisation of terms by Community Governments' export credit agencies.

I point out to the hon. Member for Islington, North (Mr. Corbyn) that it is indeed true that General Pinochet remains head of the armed forces in Chile and that he has behaved himself in that position. However, Humberto Ortega, the brother of the former Sandinista president of Nicaragua, remains head of the army of Nicaragua. The hon. Gentleman failed to mention that sauce for the goose and sauce for the gander.

Mr. Corbyn

Is the hon. Gentleman seriously trying to—

Mr. Deputy Speaker (Mr. Michael Morris)

Order. Is the hon. Member giving way?

Mr. Arnold

In view of the time, I shall finish my speech.

9.2 pm

Mr. Allan Rogers (Rhondda)

Due to the shortage of time, my remarks will have to be brief, but I hope to deal with some of the matters that have arisen in the debate. I pay tribute to the chairman, the secretary and the members of the Latin American group for the work that they do on behalf of fostering relationships with Latin America. It is appreciated on both sides of the House. I also pay tribute to the work that is done by and through Canning house to develop business, cultural, academic and social links with Latin America. There is a great deal of cross-party support for, and a desire to restore, our historical relationship with the area. That is why I especially regret the remark just made by the hon. Member for Gravesham (Mr. Arnold), and I shall return to the point of attitudes towards south America and some of the obnoxious regimes that have existed there.

One of the things that have struck me since taking this job is that so many people in this country simply see the continent of south America as a business opportunity. That is why I am pleased about the work that has been done by Canning house that tries to extend the relationship with Latin America beyond that. The hon. Member for Gravesham implied in last year's debate that the area is simply a business opportunity. He quoted the fact that the ex-Minister the right hon. Member for Watford (Mr. Garel-Jones) had emanated a clear vision that Britain is missing out on business opportunities."—[Official Report, 9 July 1992; Vol. 211, c. 589.] Business opportunities are important, but I hope that developing south America is not simply seen as that, or even as an extension of our colonial rule, which did not last all that long, thank goodness.

Latin America is in a promising phase. I use that word advisedly because, although the continent holds promise of democratic and economic development, both are fragile and could be easily reversed or eliminated. Labour Members are delighted, as are all hon. Members, to see democracy develop in the region and it was pleasing to see Mr. Ramiro de Leon Carpio, the human rights activist, become president of Guatemala with an absolute commitment to rebuilding democracy.

However, all is not good news in Latin America. Although some economic growth has been achieved, it has varied from country to country. Progress is patchy and sometimes non-existent. As my hon. Friend the Member for Islington, North (Mr. Corbyn) said, the vast debts that were accumulated in the 1970s and 1980s have resulted in a reversal of the policies of protecting industries. Under the instructions of the World bank and the International Monetary Fund, countries now have to throw open their economies to encourage foreign investment and expose their domestic industries to foreign competition. That process has been in operation long enough for us to see some of the effects of liberalisation—they are not all good as Conservative Members would like us to believe.

In previous debates, Conservative Members have talked at great length, as they have today, of free-market economics. The right hon. Member for Watford said in a prescriptive mood on 22 July 1991: it is the combination of freedom provided by liberal democracy together with market economics that will deal with the cardboard cities and with the appalling poverty"— [Official Report, 22 July 1991; Vol. 195, c. 858.] Since then, as hon. Members need scarcely he reminded, the shanty towns of Sao Paulo and Rio de Janeiro have not gone away. Only last weekend, we saw the appalling crime of child murder on the streets of Rio de Janeiro.

To try to create the impression that all is well and progressing is fundamentally wrong. As with domestic and European matters, the ex-Minister got it wrong here. To think of Reaganomics and Thatcherism as a solution to the ills of Latin America is as foolish a proposition as it was and is in this country.

The debt crisis is over, but only for the banks. The United Kingdom banks have used the tax laws and financial markets to cut their losses, but the debtor countries of south America still owe what they did before and are still spending one third of their export earnings paying interest on debts. They are still trying to earn more abroad and spend less at home to repay debts. It is wrong and misleading to suggest that all is well and that the debt problems of those countries have been resolved. In addition to putting the market first, Governments have been forced to sell state-owned industries and cut health, education, other domestic needs and import taxes.

Most hon. Members would agree that it is arrogant to generalise on Latin America because each country has its unique problems. The time that the hon. Member for Gravesham devoted to Brazil showed the uniqueness of that country, but some issues apply to many south American countries: the fragility of democracies, the issue of human rights, the exceptional level of poverty, which my hon. Friend the Member for Islington, North mentioned, and the undue influence and participation of the military, which although not in government is seemingly waiting in the wings.

Although Chile, Mexico and Argentina performed well, in other countries, such as Brazil, reform has juddered to a halt and in Venezuela, partly as a consequence of political crises, progress is intermittent. In Ecuador and Paraguay, the process is only just beginning.

The opening up of economies is likely to boost consumption rather than production, and unless indigenous industry is developed, promoted and invested in, countries will retreat into being primary producers with their people receiving only the trickle down benefits from an elite group of people. in last year's debate, the hon. Member for Gravesham spoke of the republics' enthusiastic adoption of the free market system giving great inspiration, which this House should duly recognise." —Official Report, 9 July 1992; Vol. 211, c. 589.] Unlike him, I believe that it is vital that the continent is not left to the mercy of market forces. State participation is essential, and there is a mood among Latin American people for change and for a rejection of harsh market economics.

Although greater economic stability in civilian government has become the norm for most of Latin America, the majority of its people have not shared in the economic growth. The 1992 Economic Commission of Latin America reported that 183 million of Latin America's 450 million people already live below the poverty line. The Inter-American Institute for Agricultural Cooperation showed that, of 27 million people in central America, 19 million live in poverty and 13 million live in extreme and abject poverty. That is hardly a success story for free enterprise.

As a result, millions of people have been forced to work in the informal economy. People who once worked together on farmers' and workers' co-operatives are now having to sell sweets and cigarettes in the city, competing with each other just to get enough to eat. [Interruption.] I do not know whether the hon. Member for Gravesham thinks that poverty and starvation is a laughing matter, but Labour Members certainly do not. Half of Peru's population—12 million people—earn only enough in a week to buy food for two days. Chilean apple pickers received $3 dollars a day in 1987; in 1991, although living costs had doubled, they received the same. That is part of the "economic miracle".

As larger estates expand to produce more crops and beef for export, poor people are forced off the land into either ecologically fragile areas or to the sprawling shanty towns that surround most urban areas.

Government measures to curb inflation and to meet foreign debt commitments have led to cuts in services and high unemployment. People leaving rural areas and moving to the cities face unemployment and inadequate housing and services. They are denied credit. their environment is deteriorating and their incomes are declining because they are paid unfair prices for their produce.

The continent is paying a high cost for free market economics, not only by the destruction of parts of its economy, but by the pollution of its environment, which is under considerable pressure. Although Chile is a success by most neo-liberal standards, and foreign investment has topped £3 billion in the past year, as the world's second fastest growing economy, there are still areas of environmental pollution that need to be looked at urgently.

Coming to my present job from the defence team, one of my first tasks was to read last year's debate on Latin America. One thing that surprised and disturbed me—I was not really surprised—was the way in which the hon. Member for Wycombe (Mr. Whitney) used what should have been a constructive opportunity to indulge in his partisan rantings about far-left organisations. Such a one-eyed view of the world will never be in danger of disappearing as long as the hon. Member for Gravesham follows on the hon. Gentleman's tailcoats.

Mr. Whitney

The hon. Gentleman described my "partisan rantings". Is he referring to my attack on the Sendero Luminoso, because no other "ranting" took place? If the hon. Gentleman calls that ranting, I accept the charge. Is he seeking to defend Sendero Luminoso? Is that what he is saying?

Mr. Rogers

No, not at all. The hon. Gentleman is using a typical ploy. He tried the same ploy last year against my hon. Friend the Member for Carrick, Cumnock and Doon Valley (Mr. Foulkes). I will not fall for it. The hon. Gentleman's prejudices came through. I suggest to hire that he reads his speeches.

The inability of both hon. Members to recognise that terrorism is not exclusive to any side of the political spectrum is disturbing, and we have seen a manifestation of it this evening. Terrorism is utterly condemned by decent politicians wherever it comes from, especially by those who might condemn the right-wing neo-fascist dictatorships, about which the hon. Gentlemen seem to be such experts. Pinochet is one example.

It is important that the opportunity for debating Latin America is not used year after year in the way that it has been in previous years. I hope that what I am saying tonight will stop that happening. People of all democratic persuasions, or even of no particular persuasion, suffer when the generals and their business men colleagues repress, starve, torture and imprison.

The same ordinary people suffer when the so-called liberation movements do exactly the same. There is no refuge for criticism of terrorism. The only decent and proper way to conduct a debate on democracy and human rights is to remember that terrorism is an absolute evil which has no qualification whatever.

One serious concern that I should like to mention briefly—I shall sit down immediately afterwards to be fair to the Minister, as I have slightly overrun my time—is the issue of drugs. It is a problem. We should do more for the people who are being forced into the drug economy because of their inability to sell their products abroad. It is a great shame that economists, for example, in Peru can say that the Peruvian economy is addicted to drugs.

Britain's continued involvement in Latin America is crucial. We must not allow ourselves to be isolated from the region. The all-party group, to which I and most of the hon. Members present belong, has a vital role to play in it, but it has to be a non-partisan, cross-party role. We should support increased human rights, environmental protection and the development of the regions. There is no intrinsic reason why Latin America should be poor. It has immense natural resources and we should all try to help it to achieve its potential.

9.14 pm
The Minister of State, Foreign and Commonwealth Office (Mr. David Heathcoat-Amory)

I congratulate my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) on securing the debate and on describing our relations with Latin America with such knowledge and understanding. I believe that the debate has become something of an annual event and, as a newcomer to the job, I welcome that. I hope that I shall take part in many future such events.

Even in my few weeks in these responsibilities, I have become aware that something of a new chapter is opening in our long-standing relations with Latin America. At least some of the credit for that belongs to my predecessor, my right hon. Friend the Member for Watford (Mr. Garel-Jones). I join in the generous tribute paid to him by my hon. Friend the Member for Gravesham (Mr. Arnold), who put on record the energy and enthusiasm that my right hon. Friend brought to that part of his job. His commitment enabled Britain to strengthen her relations with a number of those countries, and the benefits of that will endure for many years.

Latin America has long been regarded as having exceptional potential, both in its natural and human resources. The problem is that, too often, that potential has not been realised, but the recent changes that have been described by many hon. Members justify our optimism about the future. The most important overall fact is that democracy is established in the continent as the normal form of government. There are exceptions, but they are few in number. The most noticeable is Cuba, which has been alluded to by hon. Members on both sides of the House.

The hon. Member for Dundee, East (Mr. McAllion), who is not in the Chamber now, made the remarkable claim that Cuba's democratic credentials were secure because its Government received 80 per cent. of the vote in the last elections there. That was not very difficult to achieve, as no candidate who did not have the consent and support of the ruling party was permitted to stand. I dare say that the hon. Member for Dundee, East would have received 80 per cent. of the vote in his constituency if only the Labour candidate had been allowed to stand; but that hardly amounts to democracy.

The reason why Cuba's economy is on the edge of collapse has less to do with the American embargo and much more to do with the fact that the former Soviet Union has turned off the subsidies and that Cuba is still trying to run its economy along centralised state-run communist lines. That is why the people of that unhappy island are suffering.

Mr. Corbyn

Should not the Minister concede that the United States blockade of Cuba from 1959 onwards, and the diplomatic and financial pressure that it used on the whole of Latin America, prevented Cuba from selling its produce—sugar, fruit or anything else—in the region? The only area with which it could trade was the Soviet Union and eastern Europe. Is it not time for the United States to grow up, withdraw the blockade and permit the Cuban people to have medicines and food and to be able to sell their goods in the rest of Latin America, as they wish to do?

Mr. Heathcoat-Amory

I am sure that the United States would be willing to review its embargo if Cuba improved its deplorable human rights record and held free and fair elections.

The crucial thing about the rest of Latin America, however, is that those countries are now governed by constitutional means, by civilians, and from that fact all other reforms can flow. As my hon. Friend the Member for Gravesham reminded us, there have been political crises in south America recently—in Brazil, Venezuela and Guatemala—but the significant and new fact is that they have all been dealt with constitutionally and not by military intervention.

I emphasise that we take seriously the question of human rights, which was mentioned by the hon. Members for Rhondda (Mr. Rogers) and for Islington, North (Mr. Corbyn). I disagree with the rest of the latter's old-fashioned sub-Marxist analysis of political developments in Latin America, but I do not dismiss his concerns about human rights.

Violence, including political violence, is still too common in some of those countries. Some of it is drug-related, some perpetrated by guerrillas or paramilitary groups and, regrettably, in some cases the security forces are implicated. But there is a new determination to bring those responsible to justice. That is true of the President of Colombia, who is visiting this country as our guest at the moment. Colombia is still a violent country with a weak judicial system, but I applaud the progress that is being made by the President and the Colombian Government to counter the drug menace and to bring a number of guerrilla groups back into civilian life.

Mr. Jacques Arnold

My hon. Friend referred to the weak judicial system in Colombia. It is worth bearing in mind that the system may be weak because murder threats are made against the judges, magistrates and their families. Our country has supported the Colombian judicial system by providing technical expertise and the like.

Mr. Heathcoat-Amory

I certainly accept that we must recognise the difficulties of enforcing laws in a country where intimidation is rife.

Another new feature is that Latin American countries are pursuing the policies of the open market and encouraging international trade and investment. No longer do they seek state-owned, state-run solutions to all those problems. So in many ways, the government and administration of those countries are improving, and have improved out of all recognition during the past decade or more.

Serious problems remain. I have mentioned human rights. I also endorse the comments of the hon. Member for Rhondda about the drugs problem, which is serious and must be dealt with. We are playing our part. Last year, the Prime Minister visited Colombia and the Home Secretary visited Colombia, Peru and Venezuela to assess the drug situation and see what we can do to help.

Another encouraging feature that has been mentioned is that those countries now seek to play a responsible role on the wider world scene. The hon. Member for Islington, North was rather dismissive about the help given by Argentina during the Gulf war, but Conservative Members welcome the fact that those democratic countries are now willing to make their own contribution to United Nations peacekeeping efforts throughout the world. We wish to encourage them to do so.

I shall now say a little more about this country's relations with Latin America. Many hon. Members have drawn attention to the visits—at a political level and to assist in bilateral trade—of Latin American statesmen to this country and of our Ministers to that continent. I mentioned the visit of my right hon. Friend the Prime Minister to Colombia and Brazil last year. My right hon. Friend the Foreign Secretary went to Mexico in 1992. and more recently went to Argentina and Chile. I have already spoken about the Home Secretary's visits in connection with the drugs menace.

My right hon. Friend the President of the Board of Trade recently visited Mexico and Argentina, and my right hon. Friend the Chief Secretary to the Treasury recently returned from a successful trade promotion visit to Mexico and Chile. I hope to visit the region during the recess, and I shall make a particular point of visiting Brazil. I know that that will please my hon. Friend the Member for Gravesham.

I welcome visits to this country. The President of Uruguay came to London last month as a guest of the Government, and President Gaviria of Colombia is here at the moment.

I cannot miss the opportunity in a debate about Latin America to refer to Argentina. It is more than three years since we restored diplomatic relations with that country, and we attach a high priority to returning to as near a full and normal relationship as possible. There are deep and historic links between the two countries that should draw us together, but in discussing political links and developing trade, we must never forget the Falklands aspect. Diplomatic relations were restored only on the basis that we leave the sovereignty issue to one side while discussing other practical matters.

I regret that the Government of Argentina continue to press their claim. President Menem, who has in many ways done much for Argentina, nevertheless repeatedly asserts that the Falklands will be Argentinian by the year 2000. i reject that, as will every hon. Member. We have no doubts whatever about our sovereignty over the islands. I hope that the Government of Argentina will reconsider their continuing claim.

My hon. Friend the Member for Ruislip-Northwood rightly praised Canning house. In its 50th anniversary year, I am also pleased to pay tribute to the work of Canning house. It was founded during the second world war and was a visionary undertaking at that time. It has become a crossroads and a meeting place in London for Latin American presidents, Ministers, academics, business men and, of course, parliamentary colleagues.

Visiting presidents from Uruguay and now Colombia always make a point of meeting at Canning house. Its reputation remains high because of the quality of its staff and the way in which it has always been led. It makes a vital contribution to British-Latin American relations. I heard what my hon. Friend the Member for Ruislip-Northwood said about his perception of the need for continuing financial support. I hope that all hon. Members will continue to avail themselves of its facilities, and that they will join me in wishing Canning house success during the next 50 years.

Several hon. Members mentioned trade with Latin America. It is too low. We want to increase our exports, and I am glad that last year we achieved a 20 per cent. increase. In 1992, exports to Latin America were worth some £1.3 billion. I expect that trend to continue in view of our continuing efforts.

Some hon. Members emphasised the need for Export Credits Guarantee Department cover. That is under constant review, but it has not been available in a number of countries for some years because of previous defaults on debt. We want to resume cover as soon as possible. Cover in Argentina resumed in June and in Paraguay it resumed in July. I hope that that list will be extended as economic reforms, open markets and a liberal trading system take hold in other countries as well.

My right hon. Friend the President of the Board of Trade gives a great deal of emphasis to trade with Latin America. A number of export promoters have been appointed, and we have two business-led trade facilitation groups, one for Colombia and one for Mexico. The Government's export services have produced a marketing plan for Latin America, concentrating initially on the top six countries.

Aid is also important. In 1990, we announced that we would double the aid programme, though admittedly from a low base. It is focused primarily on technical co-operation, training, health programmes and the importance of encouraging management of sustainable natural resources.

I must emphasise that, although aid is important, the resources released by freer trade are much more important in the long term. My hon. Friend the Member for Ruislip-Northwood criticised the CAP. Even so—and despite our continuing efforts to reform the CAP—it is worth noting that 65 per cent. of Latin American exports to Europe enter the Community duty free. We are in the vanguard of member states pressing for a successful conclusion to the Uruguay round. If we can achieve success in global free trade, it will release far greater resources than any conceivable aid programme.

I thank all hon. Members who have contributed to the debate. Our relations with Latin America are enormously assisted by the presence in the House of a group of hon. Members with knowledge, expertise and interest in that region. If any hon. Members will be visiting that region during the summer recess, they should let the Foreign Office know, and we will endeavour to give them all the assistance and briefing that may be required.

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