asked the Minister for Finance if he will make a statement on the present value of the Irish punt against sterling and its effect in terms of losses or gains on our trading figures with Great Britain and Northern Ireland in this financial year.
6.
Ceisteanna—Questions. Oral Answers. - Value of IR£.
5.
asked the Minister for Finance the advantages and disadvantages for the Republic of Ireland on the break with sterling with reference to trading with Great Britain, Northern Ireland and other countries.
With the permission of the Ceann Comhairle, I propose to take Questions Nos. 5 and 6 together.
One Irish pound is now equivalent to approximately £0.95 sterling. The difference is due essentially to the recent strength of sterling against all the EMS currencies including the Irish pound.
It is not possible to quantify the effects upon trade with Great Britain and Northern Ireland of the deviation between the two currencies in the current year. This will depend on various factors, including the magnitude and direction of currency fluctuations during the rest of the year. In general, it can be said that the present depreciation of the Irish pound against sterling should, if it continues, in the short term help to improve competitiveness of Irish industrial products in the British and Northern Ireland markets and also on the home market against goods from these areas. The same applies for the 10 per cent of agricultural exports which are not covered by the CAP.
On the other hand, the present depreciation will give rise to some increases in import costs. As regards other possible disadvantages, I covered these in my reply to previous questions from the Deputy.
With regard to the implications for trading relationships with other countries, these would depend upon the exchange rate changes involved. For trade with our other European partners, we have, of course, exchange rate stability through our membership of the EMS. Generally speaking, it can be said that we have managed to maintain the competitiveness of Irish goods in third countries.
Would the Minister explain the consistency of deciding unilaterally on economic issues and pleading for political consideration on the other hand? Does he not consider that economic co-operation between North and South is only equally as important as political co-operation between North and South? How can the deputy leader of a Government and a party who proclaim that they seek Irish unity decide unilaterally on economic issues without considering the political implications?
I assume the Deputy is referring to the decision to join the EMS at a time when it was clear that Britain was not entering. If that is what he is referring to, the reasons and the considerations involved were debated fully in this House. I note that at that time the Deputy had an opportunity to vote against that decision but chose not to do so.
I am asking a very straight-forward question. How can the Minister for Finance, the deputy leader of the Government and of the republican party satisfy this House that he can decide clearly on economic issues without considering the political implications for the Irish people?
There is nothing in this question regarding——
I am asking a very definite question and seeking a reply.
It is not relevant.
Why does the Chair seek to protect the Minister for Finance?
The Chair seeks to protect Standing Orders which govern the order of Question Time.
Why is the Minister hiding behind the Chair?
If the Deputy will put a coherent question he will get a coherent reply. While he is at it he should tell us why he did not vote against it if he was so strongly in favour of the line he is taking now.
The Official Report of Friday, 15 December 1978 will tell. I have brought that with me because the Minister has brought in this red herring on a number of occasions.
Does the Deputy mean that the Fine Gael Party decided not to vote against it? It is a fact that Deputy Harte did not vote against it and that the Labour Party did. He had the opportunity to vote against it and he chose not to.
The Opposition have no Irish policy of their own.
Is it true that of our exports roughly 50 per cent go to the UK and of that 50 per cent roughly 50 per cent are agricultural products which are not affected by variations in the rate of exchange between the British £ and the IR£?
That would be approximately correct.
Therefore, 25 per cent of our total exports will benefit by the devaluation of the IR£ against sterling. On the other hand, is it not true that roughly 50 per cent of our imports come from the UK and that all of them will be affected by the devaluation of the IR£? Therefore, the advantage which the Minister claims—even though he admits that it is only short term—in the revaluation of the two currencies is very temporary and the fact that we have to pay more, particularly for capital goods and raw materials for reprocessing, will reflect very quickly in the increased costs of Irish goods going to other markets.
I am calling Question No. 7. We cannot have a long debate on this.
I indicated in my reply that I would deal at the moment only with the short-term effects of the divergence between the currency of sterling and the EMS currencies on the other hand. This is all I can deal with at the moment. The longer term effects will depend on movement of currencies concerned including the movement of sterling. It would not be wise, to say the least, to assume that the present divergence is going to be of long-term duration.
If the Government had to take the decision to go into the EMS now in the light of what has happened since our entry into the EMS, would the Minister and the Government take the same decision?
Probably, yes. Perhaps Deputy Harte would like to tell us whether, if he were faced with the decision now, he would take the decision that he took?
Do the Fianna Fáil Party honestly want to bring both Irish traditions together in peaceful union or is it just a big game the Minister is playing?
If the Deputy believes there is one ounce of truth in the suggestion he is putting forward, why did he not vote against the decision?
That is nonsense talk.
He is guilty of hypocrisy.
I spoke against entry.
He is playing with an area, which is very important to all of us, for purely party political reasons.
I am against what the Government have done because they have sold out the nationalist people of Northern Ireland. They have made nationalist people refuse Irish money.
(Interruptions.)
Order, please.
The Minister and his party have made Irish people north of the Border refuse Irish money.
(Interruptions.)