asked the Minister for Finance the trend of Ireland's balance of trade in the first six months of 1971; the likely outcome of the balance of payments for 1971; and if he will make a statement on the matter.
Ceisteanna—Questions. Oral Answers. - Balance of Trade.
18.
As the trade statistics for June will not be available until later this month, it is not possible at present to give the trend of the balance of trade in the first six months of 1971. In each of the first five months of the year the trade deficit has been as follows:—
|
Trade Deficit £ million |
|
|
January |
15.8 |
|
February |
22.7 |
|
March |
41.2 |
|
April |
24.6 |
|
May |
20.2 |
Over the first five months of the year the excess of imports over exports was £33 million greater than in the corresponding period of 1970. The principal element in this increase in the import excess was the purchase of two Boeing 747 aircraft which added some £20 million to the import bill.
As regards the second part of the question I would refer the Deputy to paragraph 66 of the pre-budgetary publication "Review of 1970 and Outlook for 1971" in which it is stated that
when account is taken of prospective trends in total imports, exports and net factor income, the balance of payments deficit on current account may be of a similar order to last year's deficit of £62 million. Excluding imports of ships and aircraft the outturn for 1971 should show an improvement.
It is still too early in the year to make a reliable quantitative estimate of the likely outcome in the balance of payments. However, trends so far suggest that developments on external account are broadly in line with that projection.
In answer to the final part of the question I would refer the Deputy to my Budget speech in which I outlined the economic policies to be implemented by the Government this year. Among other things, the aim of these policies is to improve the balance of payments position.
Is the Minister satisfied with the trend of the balance of payments? It was over £70 million last year and, according to his own statement, it is going to be another £70 million this year. I read a report of the Economic and Social Research Institute that suggested a possible balance of payments deficit in the region of £90 million for 1971, and this country will not be able to finance this kind of deficit for more than two years. The fact is we have a financial crisis on hands.
This is a long speech. Long speeches are not permissible.
That question is a good example of the kind of loose thinking we are getting on this subject. We heard a reference to a deficit last year of over £70 million, although I had mentioned in my reply that the deficit last year was £62 million——
What accuracy.
——and then a figure of £90 million for this year is tossed about as though there was some basis for it.
The Economic and Social Research Institute.
Would the Minister not agree that the continued upward trend in our adverse trade balance is now reaching crisis proportions? Will he not also agree that 1969 was a bad year, that 1970 was a bad year, and that on the figures available so far this year we shall have an adverse trade balance of at least £85 million? Will he not further agree that many of our industries are in trouble at the present time due to the large amount of imports, and that many more jobs are being threatened? Do the Government intend to take any action or do they intend to stand idly by while all this is happening?
In answer to that collection of clichés to which we have become accustomed——
It is the truth and the Minister knows it.
——let me point out again that I have said on two occasions in this House today that the forecast is that the deficit in the balance of payments this year is likely to be of the same order as last year——
That is a disastrous order.
——which was £62 million, but that——
(Interruptions.)
——Might I finish? I did not interrupt the Deputy—taking account of the fact that this year's deficit is increased substantially by the import of aircraft to which I have referred, the underlying trend is improving. I would further point out that one of the big items in the increase in this year is the increase in import prices which rose at the annual rate of 6 per cent in the first quarter.
Will the Minister not agree that it was up to £33 million in the first five months of this year? If you take into account the £20 million for aircraft, it is still £13 million. Last year was a bad year, and the Minister made the very same type of promises last year in this House. Have the Government any regard for our industries? Have they any regard for——
We cannot have a speech on the question.
(Interruptions.)
Was £20 million paid this year for aircraft?
Yes.
From the answer the Minister gave us one would think that ships and aircraft had not to be paid for at all. Now he admits they have to be paid for. If, in fact, they are included, is the deficit this year going to be £100 million?
No.
Yes, it is; on the verge of it.
(Interruptions.)
It is obvious that Deputies opposite do not like the figures. They would rather toss around £90 million and £100 million and glory in what they think is going to be economic disaster for this country.
Have the Government not borrowed us into debt?
I would like to tell them that the economic situation is improving. They do not like it, but it is improving and will go on improving.
It is like the unity in the Minister's party: what economic crisis?