Joint Press Conference with West German Chancellor (Helmut Schmidt)
|Document type:||public statement|
|Document kind:||Press Conference|
|Venue:||RAF Halton, near Chequers|
|Source:||Thatcher Archive: COI transcript|
|Editorial comments:||Between 1500 and 1640.|
|Themes:||Foreign policy (Western Europe - non - EU), Foreign policy (USSR and successor states), Foreign policy (Middle East), European Union Budget, European Union (general), Sport, Defence (general), Foreign policy (USA), Agriculture, Energy, Economic, monetary and political union, Monetary policy|
Ladies and Gentlemen of the Press,
As you know, the talks that we have had yesterday and today are part of a continuing series of bilateral talks, so it is not that we come together when there are great pronouncements to make; it is that we carry on year after year having these talks so that we may the better understand one another's viewpoint, and may be the more effective, not only in Anglo-German relations but in the European Economic Community and NATO and in any other groups of which we are both a part. So it is not that we have special pronouncements to make; it is part of continuing understanding between our two countries.
As you know, there are no bilateral problems between Great Britain and Germany, so we had no particular problems to talk about. We therefore spent a great deal of time talking about the larger world scene, in particular the problems which have arisen in East-West relationships after the Afghanistan troubles; and last night, Chancellor Schmidt and myself and the two [Lord Carrington & Hans-Dietrich Genscher] Foreign Secrataries spent a lot of time discussing those matters—indeed, we stayed up until nearly 2 o'clock in the morning discussing. I mention it because, really, the understanding was very great and the agreement was very great and so we went on talking well into the night.[fo 1]
This morning, Chancellor Schmidt and I had what are called "tête-á-tête" talks and we concentrated for quite a long time on Great Britain's budgetary problems in the EEC and other problems which also affect the EEC which will also have to be solved. We are both very conscious indeed that until we get some of these particular problems solved, the EEC itself will not be anything like as effective as a unit as it could be; and with a world very much troubled by greater problems, we are both anxious that the outstanding problems, including very much Britain's budgetary problem, should be solved.
We have three weeks or so between now and the next Summit and we are concerned that they should be used to maximum advantage to see if we can achieve a settlement.
After that, we were joined again by other Ministers and had wider talks, again on the wide East-West problem.
I know that you will be interested in the Moscow Olympics, but I must tell you we did not in fact spend a long time on those; indeed, a very short time, because the Chancellor has made his position clear to the Bundestag and we have already had a debate upon it in Parliament.
We were also very concerned to hear of the tragedy affecting the oil rig on the Norwegian side in the North Sea and we have sent a joint message to the Norwegian Prime Minister indicating our sympathy and very great concern.
So, no special particular pronouncements; just continuing good will; very great friendliness, very great understanding, very great desire on the part of us both to really deal with Britain's budgetary problem in the EEC and other outstanding matters in the EEC so that as a unit we can be the more effective and more influential in the wider world.[fo 2]
I should perhaps just mention one more thing. We are very much aware that we are both part of the Western Alliance and the Western World and the future of our way of life depends upon Europe and the United States always keeping together, always consulting, always going forward together, and that, of course, is never far from our minds.
I understand that we are honoured to have a lot of the German Press with us and I am sure you would first like to question the Chancellor. I, of course, shall answer questions which you put to me. Your questions, gentlemen, please![fo 3]
Question (Michael Brunson, ITN)
Could I ask the Chancellor, did you and the Prime Minister discuss the idea of a special fund which might be set up by the Common Market under, I believe, Article 235 of the Treaty? This is the Commission's idea of a special fund which could be used to help Britain. Do you think that is perhaps a way forward out of Britain's budgetary problem?
We did not especially consider such a fund idea. What we did do in that respect was that we in a very broad sense investigated field-by-field what on the whole had to be done in order to bring about compromises. I will now use my language, which is not necessarily the language of a Prime Minister.
My feeling is that both the Prime Minister and I having the benefit of questioning and listening to answers of the other side, have probably understood even a little better—if it was possible to improve—than before the pressing necessities and concerns which the British Government, the British Prime Minister, has to take care of which, let us say, the Germans or the French or the Dutch or the Danish, Irish, Italian, Belgian, Luxembourg people have to concern themselves with. We are a Community of Nine and not a Community of Two. We could solve the problems between the two of us, I have the feeling. We tried to put ourselves into the shoes of all the nine countries in order to increase our understanding of the situation.
My personal feeling is that a solution is possible to the question of British transfers, net transfers, to the Community if other questions to the Community at the same time are also being solved that are pending since long like mutton, like fishery and other things as well.[fo 4]
It is obvious that the rather great amount which the British economy and the British budget are netwise paying into EEC have to be diminished and it is also obvious that this diminishing of British burdens means enlarging the burdens of others.
Now Germany—as regards the eight others—is in a unique position, insofar as we are the only net contributor besides England; a little less now than England in 1980, but have been the largest contributor for a long sequence of years, so we are in a little better position—and we are not being blamed by Mrs. Thatcher—a little better position than the rest of the EEC countries, but we understand how difficult the problem is, for instance, for a smaller country like Denmark; the problem is as great as it is for Britain or as it would be for us to enlarge the financial burden on our shoulders if compared with the past.
This being my chance for answering the first question, I would like to add one or two thoughts which you have not asked for.
Number one: I would like to thank publicly, Mrs. Thatcher, for her hospitality; especially would I like to express my envy about the institution which is called Chequers! It provides such as a nice casual atmosphere, in which people can talk and listen to each other in an informal way. I liked it very much, especially the fact that I was invited to add a little; a handful of earth, planting a pink chestnut tree in the park of Chequers. I hope that will get on, provided you have enough rain in Britain!
I would also like to mention a few of the subjects which we have been dealing with, while fully subscribing to what the Prime Minister has mentioned to you already—I would like to mention some of the subject which we have been dealing with, except the already-mentioned problems, especially within the EEC.[fo 5]
As the Prime Minister has pointed out, quite a great part of our time was devoted to the matters which are now under European-American consultation and both of us had—if I may say so, Margaret—the rather enjoyable impression that we were looking upon many of the things under the same aspects, saw them eye-to-eye, including Lord Peter Carrington and including Herr Genscher. I would like to mention this was a very fruitful conversation, if I am permitted to judge. It included, of course, the situation in and around Afghanistan, Pakistan, India, Red China, the Soviet Union of course; it did include, of course, Iran; it did include Turkey, the Middle East complexities. We are talking about the Gulf region as such, other Near East questions. We were also devoting some time on the recent development in the southern part of Africa and I took the opportunity to congratulate again the Prime Minister and the Foreign Secretary, Peter Carrington, as regards this enormous success that Britain has won in bringing about a constitutional change in Zimbabwe, formerly Rhodesia, and regarding the positively prejudicing effect that will have on the whole continent and it will also have on the role of the Western industrialized countries within the Third World, within the non-aligned world.
We did use some of the time for dealing and exchanging views of the requirements of the non-aligned world, the Third World, but also of course we did deal with the joint security problems of the West at some length.
The Prime Minister and I are agreed that we are not going to disclose any of the details to you, so do not nurture any hopes of getting us to go into depth in answering your inquisitive questions!
I would like to sum it all up that both regarding the EEC problems as well as regarding the wider range of international problems, there was[fo 6] a gratifying degree of understanding, of agreement.
We have not come to the end of the day, because the Prime Minister as well as I myself have to make a little speech, both of us, at a meeting of the Königswinter … . in Cambridge. I think that is about the 25th anniversary … . could that be right … . or the 30th?
Chancellor Schmidt (contd.)
… . 30 even! When I was a young parliamentarian, I took part in these meetings in Königswinter in the early 1950's—yes, it ought to be 30 years! It was a great institution. I look back to that with great thankfulness. I was 34 years of age when I first came to Parliament 27 years ago and this was about the first occasion which I was given to internationally meet politicians, members of Parliament from one other country, from a country that had won the War; it had delegates from a country that had started as well as lost the War. So I have been a frequent participant at these Königswinter meetings for a couple of years. Later on when one came to office, one could not participate any longer, but I think it has done a marvellous job for letting the Germans understand how other nations in Europe look at Germany; how other people in Europe look at other international problems; and I think it also has done a good job in making our British partners, our British friends, understand the problems which we had at that time to build up almost from scratch. Our society, our constitution, our economy, our state—and they have been very helpful all over the time—I have really liked the idea to have a chance this afternoon to pay tribute[fo 7] to this great job they have done at Königswinter. I do not know whether one of the great English figures of the early meetings still is alive, Headmaster of Balliol at the time, Robert Burleigh (phon.). I remember him. He is very vivid in my memory. I am mentioning this because I do not feel that there is any chance for our speeches tonight to be translated into the press of tomorrow—it will be too late!
I beg your pardon for this too long answer to a rather short question.
No. Look, the fault was mine for not asking you to make a statement at the beginning.
Chancellor, I wonder if you could expand a little bit on the reply you gave just now about the EEC budget, and can you tell us in particular ... you said that you understand Britain's problems. Do you sympathise with them and what sort of compromise do you think might be possible and may I also expand that to include you, Prime Minister, and ask you whether ...?
You will leave a little time over, won't you, for the Press, yes?
I think the solution lies in a package which would include the financial and budgetary aspects which would have to include the guidelines[fo 8] for a limitation of the hitherto rather unlimited growth of agricultural outlay by the Community; it ought to be brought into proportion with the growth of the other aggregate figures of the Community, especially with the aggregate figures of GNP of the nine countries together. It ought to comprise, I think—and here possibly we might differ a bit as regards the timing—it ought to comprise fishery; I think it ought to comprise mutton, in which we do not have anything at stake as Germans. It may have to comprise a first step into a joint energy policy.
To sum it all up: the question is soluble, the complexities which have piled up over so many years altogether are soluble if anybody is aware of the fact that what we are seeking is a compromise that is working, workable, functionable, but at the same time satisfying nobody—dissatisfying anybody to the same degree.
Can I just add to that? I think it is quite clear from the several documents that have been circulating from the Commission that the method is there. It is a method which is in tune with all the Community rules. The difficulty is to attach precise figures to the method.
There are three parts to the method: the one, slightly to cut down Britain's contributions, and that was really what we agreed at Dublin. That was that part, on a previous financial mechanism suitably adapted.
The second one—and the one that would bring more receipts back into Britain—is a special way in which more Community money could be spent in Britain, although on projects broadly in line with Community[fo 9] thinking. It is quite clear that there are plenty of those and it is not a question of the method—it is a question of attaching figures and the will to do it.
And the third part is the one which the Chancellor has specifically drawn attention to. The problem would never have arisen in quite such an acute form if it had not been for the fact that the Common Agricultural Policy takes a much much much larger proportion of the budget than was ever intended and quite a goodly part of that budget goes to building up surpluses—and that is why the third part of the communique from Dublin said that in the longer term we will have to deal with this problem and that, of course, is very much in accord with what the Chancellor has said: that the Common Agricultural Policy cannot go on taking an ever larger proportion either of the budget or of the gross national product of the Community.
So there is no problem about the method. No-one can say: to solve Britain's problem requires being non-Communautaire. That is not so. The method is there; it is a question now of attaching specific figures from specific countries to build up the sort of total that would give us a solution to the problem.
There are of course other problems. We go steadily on with fish. The fish negotiations, I think, have been proceeding albeit very slowly, but they have been proceeding between the agricultural Ministers. As you know, we have not yet got a solution to the lamb-mutton problem. As far as energy is concerned, I do not think it is generally realized that already a half our exports from the North Sea go into the Community and of the amount that goes into the Community a half itself goes into Germany. So 25%; of all our exports of oil and gas in the North Sea actually go to Germany. So we have reason for a close relationship there.[fo 10]
John Deakin (Daily Mail)
May I ask you, Prime Minister, if you share the Chancellor's conviction that a solution is possible; and secondly, that it will be found in a package?
I share the Chancellor's conviction that a solution is possible. I think that there are several other things that will also have to be solved. I think each of them will have to be solved on the merits of its own case, but we must of course proceed apace with solving those things as well.
Have you got the point? Things might come along all together; but each must be solved, I think, on their own merits. Otherwise, it just would not be fair.
Question (Financial Times)
Prime Minister, could I address a question to the Chancellor and possibly have a comment from you on his reply?
I do not know whether you will get that; you might get a separate answer.
One of the elements—we may not call it a package—but it has been suggested on the German side that it would be helpful if the United Kingdom gave some sort of commitment of renewed interest in joining the European Monetary System, to accompany this overall negotiation. I wonder if[fo 11] Chancellor Schmidt would say whether he still feels that would be a good idea; and secondly, what it is he is looking for on the energy front from Britain in particular.
I would like to remind ladies and gentlemen of the fact that Britain has a standing invitation for the EMS, for the European Monetary System and it is a historic fact that from the very beginning I was very much arguing in favour of Britain's participation from the very beginning. Britain had her reasons at that time. It was in the last months of the previous Administration; it was Jim Callaghan and Denis Healey at the time; they had their reasons for not joining the EMS at that time. It is up to the British Government to make up their minds when they think the time is ripe.
As regards energy policy. There is not a specific German interest in that.
There is also no specific German interest in limiting the further growth of agricultural outlay. I say this as a member of the Community since its very beginning 23 years ago. Being an economist and an administrator, I understand that this cannot go on for ever; that the agricultural outlay cannot for ever grow quicker than does the economy of the EEC grow. Therefore, I know that this has to be corrected in the sense of limitation. I know that all the nine agricultural ministers and the agricultural corporations in all the nine countries will have grave misgivings about any attempt of reforming it to the effect of limitation, but I think it has to be done.
And this is a good moment to lay down the principles for how it ought to be done, because one sees that the financial gap cannot be[fo 12] closed in the medium or long run without limitation of the agricultural outlay, so it is a good occasion to have this done.
One should not be misled into thinking that, for instance, we could do away with the whole system of agricultural policy as such. We shall certainly have to maintain the principles of Community preferences, of common financing, of common price levels; but, on the other hand, we have to limit the amount of subsidizing in agriculture in all of our countries.
As regards energy, it is a parallel situation. There is no specific German interest in energy. There is no specific German request to make to anybody—neither to Britain, nor to Holland, nor to Denmark, nor to anybody else. But as an economist and as an administrator and as somebody who does foresee what is going to happen in the world energy markets in the next decade or in the next five years—I am not going to make any predictions about the figures of the oil price per barrel under such and such political circumstances which one could speculate about—it is obvious that EEC does need a common energy policy and just in the interests of the future cohesion of the nine economies, the future cohesion of the nine governments—whoever it is at the time when the energy crunch really comes … . we have not seen the ultimate crunch so far—in order to be ready at such a time to respond in a way that does not break some of the European economies. I think we ought to be starting to think about a common energy policy.
This, again, is not a bilateral question between Britain and Germany or between the British Prime Minister and the German Chancellor. It is just one of the many questions which we have been exchanging our thoughts about in the light of the Community's interests as a whole.[fo 13]
You wanted a supplementary comment from me about the EMS.
I think we would like to join when the time is ripe, and you will say why isn't the time ripe now? I think if you look at it, you will find that we have been above the limit twice comparatively recently for reasons which you will know, and had we belonged, even on a 6%; limit, we would then have had to put money in to hold the rate down, and as you know, putting money into hold the rate down in fact means that you increase your money supply.
We would like first to be able to show over quite a period of time that we can effectively control our money supply within the margins which we have just set for it. In the last four months, it has come within the range. The range we have set now is 7%; to 11%; but in the last four months we have been able to keep the underlying rate at 10%;. It is quite an achievement, but at the moment in our tremendous battle against inflation, we do think that the main thing is to keep the money supply within the ranges. When we have got the economy under better control and proved that we can do it, then I think we will be in a very much better position to join the EMS and then, of course, we would have to consider what the range should be; whether it would be a narrower or a wider range than the one that is customary at the moment.
There is a growing feeling inside Britain that the United Kingdom might be better off outside the Common Market altogether, following the experiences in the last few years. Have you any comment on the difference this would make a) to the Common Market and b) to Britain?[fo 14]
In the first instance, in case you are right about the growing feeling that you were quoting, I could only deplore this—not so much from the depth of my heart, but I deplore it for the political consequences to which this might lead. Nothing is more required right now—and if you look to the world political development as a whole—than cohesion and unity among the countries of the industrialized democracies of the West and fragmenting existing entities in the West, combinations of states, is certainly detrimental to what the West does need right now.
On top of it, I do not believe that even in the medium run, neither economically nor politically, such a move would serve Britain. It would certainly not serve the weight of the Community in the Western World and the world at large—that is obvious—but I think it would also detract from the weight of Britain. In the very short run, one might think that it had some financial advantages. They might be outlived, but in a sequence of months only, and the repercussions in other fields will be greater by far than the financial reliefs which one might feel in the first instance.
It would certainly lead, for instance, to putting up tariff walls against each other in the first instance, plus, plus, plus. It is not a specific German interest I am defining here; it is a worldwide interest I am defending.
You know my views on this. I am not sure whether you are asking for a supplementary reply, but you are going to get one!
You know my views on this: that really, the free world, free Europe, must demonstrate that the countries of free Europe can stick[fo 15] together politically in the European Economic Committee and alongside that we have to solve the problems which affect particular members of that Community.
So quite the best course for Britain is to continue to be a loyal member of the European Economic Community and at the same time to see that, along with our partners, our problems are solved and are given a just solution and likewise, if other partners have problems, to contribute to the solution of their problems. That is what being a partnership means. If there were any question of our coming out or the EEC flying apart, it would do the whole of the cause of the Free World immense damage, and therefore do damage to each and every separate member.
Prime Minister, after the apparent rapport that you appear to have developed afresh with the Chancellor, you are now looking forward to the postponed Summit with much greater happiness and confidence than you were? Is that a fair impression to have got?
I think that the time we have gained may, if we use it properly, turn out to be very helpful—provided we use it constructively. Therefore, perhaps the apprehension is diminished a little. I think that would be right, wouldn't it?
Well, Margaret, I did not understand the question at all. I understood the gist of it only by your answer![fo 16]
He said was I looking forward with very much greater happiness now to the Summit towards the end of April … . than I would have been ...
Very much greater happiness!
... towards the end of March, and I have just said ... you know, I am always very cautious in my replies—it is part of my nature—a good deal less apprehension, because we have talked and talked round it, and spent a long time talking round the problems in an atmosphere, really, of very very great good will. I believe much more now that a solution is genuinely possible than I did perhaps a few weeks ago.
I would subscribe to the answer of the Prime Minister.
And in an atmosphere of good will.
Could I ask a follow-up question to that please?
Yes, and then we really must have our German Press, yes.[fo 17]
Keith Richardson ("Sunday Times")
Really to the Chancellor. This feast of good will that you have had. Could one say that the good will between Germany and Britain is now as close and as strong as the good will between Germany and France? And in that case, what on earth can either of you do to patch up the alarming ill-will between Britain and France which seems to be growing very strongly at this moment?
If there is any ill will between Britain and France, it is none of Germany's business to deal with either British or French business. If this ill will does exist, Germany does not have the intention, neither institutionally as regards the German Government or Parliament nor as regards the German public or published opinion, to act as a mediator or something. You both have ambassadors in Paris and in London. You visit each other. You are reading the French press; they are reading the British press.
I think that in any country of the EEC there is an everlasting tendency, in any Parliament—from Sicily up to Jutland—and in any public opinion, to look at oncoming decisions which have to be taken within EEC or to look at decisions which have been taken yesterday night in Brussels in the light of seeming national interest. This is natural; it will last for another generation or two. On the other hand, one should very willingly and intentionally create a counterweight against that national attitude. One should create an attitude of asking, criticising, commenting, evaluating oncoming decisions or taken decisions in the light of what is best for the entity as a whole—what is best in the interests of Europe as a whole—what is best in the interest of[fo 18] the world's economy, of the Western world's economy, as a whole; what is best in the interests of the West as a whole vis-a-vis the Soviet orbit. And I think all of us, whether in the political realm or in the journalistic sphere, have to educate ourselves to use these yardsticks at least to the same degree as national yardsticks are being used.
When you ask a good question, you get an even better answer!
Now, have we got any of our German guests here, because you have been very quiet!
Mrs. Thatcher, how far apart are the points of view of you and the Chancellor concerning Ostpolitik at present, or did you agree on the whole situation concerning the Soviet Union?
In general, we agreed on the whole situation concerning the Soviet Union and East-West relations. We agree on the importance of keeping Europe and the United States together and in concerting our response to any problems that may emerge. And we also agree that whatever the present difficulties—and they are enormous, because the invasion of Afghanistan was a totally new factor—but whatever those problems we still—both the West and the East—have to strive to live in the same world together, and what we are anxious to do is to secure the withdrawal of troops from Afghanistan so that once again we may try on a renewed basis of detente and you know that I interpret detente as full[fo 19] reciprocation. It is a two-way business to live together in the same world on a better basis.
So we have really got the two things to balance: the total and united resolve of the West to defend our way of life and secondly, the wish to get troops back from Afghanistan into Soviet Russia so that once again we may live together in a world—although we have differing philosophies—we may live and start a much better basis of cooperation again in the world together.
Edwin Roth ("Tagespiegel", West Berlin)
I will move away for one moment from Europe. You discussed the Middle East, didn't you. You said you discussed the Middle East.
We could not not have discussed the Middle East.
Now! From a western point of view, strictly western point of view, the Palestine Liberation Organization has agreed to the … . and welcomed the invasion of Afghanistan and has given the utmost help to the Ayotollah Khomeini over the American hostages. Is it in the interests of the West to back up an organization which agrees with the invasion of Afghanistan and gives support to the holding of the American hostages as its leader has done? In this in the Western interest? The changing of Resolution 242 and all that?[fo 20]
Well, I do not see that the British Government nor the German Government has given a boost to the PLO. What my Government has been saying—and I do not see that there is a great gap between us and our British friends or any other friends in the West—is that the ultimate solution or the comprehensive peace which is being looked for, which is being sought after, has to comprise as well the rights of the Palestinians as well as the rights of the state of Israel to exist in secure borders.
Speaking as a German, I have always interpreted the determinology right of the Palestinians as a right to self-determination, because if I am striving for the right of self-determination of the German people I cannot tell the rest of the world that this is just for the German nation and not for others. This has been our attitude since a couple of years. There is nothing new about it. We have not taken a new move in the last couple of days or weeks or months even, and I am very concerned that the ongoing negotiations between President Anwar Sadat and Prime Minister Begin on the so-called autonomy on the West Bank should make progress. We are approaching the time limit now. But this has, so far, nothing to do with any promotion of the PLO.
I do not think there is anything that I can add. You know that my views are that the problem is to get the two things occurring simultaneously. One, the right of the Palestinian people to determine their own future and simultaneously to get them to recognize the right of Israel to stay as Israel and to live within secure and defined borders, and I do not think that position has changed. Indeed, in a way, I wish[fo 21] those two things had moved forward together—but they have not.
Do you think you will ever get the PLO to recognize them?
In politics, you never give up hope and you actively work for the things you hope to bring about. I must tell you, he practically won the election for me. He attended practically every press conference.
And you never say "never".
Thank you very much indeed.