I thought you might like to know how one sees the Summit in retrospect. It has been a valuable, interesting and friendly Economic Summit. It has been valuable because we have addressed the major problems confronting the World and we have re-affirmed our basic economic strategy. It has been interesting because we have had a free flow of discussion and argument. It is not and never will be a Yes-Man's club. It has a fundamental common purpose and that has been amply demonstrated in our discussion and in our conclusions. It has been a friendly occasion and has brought us closer together in our understanding of each other's points of view and has provided insights into our problems and approaches to them. And all of that explains why I found chairing this Summit quite a stimulating experience.
On the economic front, we have not merely said we believe our economic strategy is right and we are going to stick with it; we were not content to leave it at that. We have as you will see from paragraph 9 of the Economic Declaration, we have produced a ten point programme for future action and that programme recognises the needs of the developing countries; it provides a framework for action on international indebtedness, one of the great problems this year, and it looks forward to further liberalising the world trading system in both goods and services. We have in short adopted a global approach to the economic situation and have responded a current need in a comprehensive way. I should add that we have also tackled the international threat of environmental pollution and I am delighted that I have been able through the Summit machinery to initiate more research into the pollution of our air, water supplies and land.
Now, it all sounded very technical when I read out that Summit communique but lying behind all the words which a Summit produces is of course a deep concern for the well-being of our citizens and the world's population. What we have been concerned with in London is how we can so conduct our affairs that we sustain the economic recovery, to create new jobs and to spread our prosperity much more widely across the world. That is the relevance of this and previous Summits to the lives of ordinary people who I believe will derive some confidence that my colleagues and I have a clear plan of action for the next twelve months. [end p1]
Now so far as other issues are concerned, this Summit has produced a forward looking statement on the democratic values that we share. It was very appropriate that it should have been produced in London and we take a great deal of pride in those values and perhaps we do not do enough to sing their praises. Well, we have remedied that now.
We have also taken very seriously the problem of terrorism and we have resolved to do everything possible to combat the threat by strengthening existing measures and developing new ones. We have pledged our support for efforts to reach a peaceful settlement of the Iran/Iraq War.
We have emphasised the solidarity, unity and firmness of the Western democracies, and made plain our intention to work for a better relationship between East and West; and in re-affirming our aim of peace through security we have re-iterated our desire for early and positive results in the various arms control negotiations, both in session and currently, unfortunately suspended. That then gives you the outcome of this Summit's very substantial debate. We have I believe achieved our objectives and that gives me personally a great deal of satisfaction.
Ladies and gentlemen, your questions.
Question
Prime Minister, one of the agreements today in the Final Communique says: “to work with the developing countries, to encourage more openness towards private investment flows.” That seems to be much less forceful than your statement on the same subject yesterday. Do you think this final conclusion was a watering down of what you were proposing yesterday?
Prime Minister
No, I think it was a slightly briefer version perhaps of what I said yesterday. We were talking about the debtor countries, the countries that have a serious international debt position. One of the ways of dealing with that debt is obviously either sale of assets or equity investment. It is not a path which a lot of them take because somehow some of them have laws against it or do not wish to take that path. But it is one which is a method of dealing with their debt and if they made certain changes, they could follow.
I think it would help if we had a code for international investment, but if you are dealing with the problem of international debt, it is a path that must be considered. After all, some of the countries that have welcomed external equity investment have been those which have recovered fast and also those which have developed their economies fast.
So it is a shorthand version of what we discussed.
Question
Prime Minister, I wonder what came first, the chicken or the egg?
Prime Minister
Don't ask me!
Question
… . in as much whether it is a reflection of what the international institutions and the banks in Great Britain are thinking about the measures for the international indebtedness and also seeing it is being considered on more of a technical approach as a strategy, I wonder what you think are the international political consequences of the indebtedness of our countries? [end p2]
Prime Minister
We now have a problem and we have to deal with it as it is. If you look back, you can have several different analysis and two points in the analysis would be that perhaps some of the developing countries borrowed more than they could properly service and some of the lending banks lent more than it was wise to lend to those countries.
Be that as it may, we actually have the existing problem to deal with and we had to set out a framework of how to deal with it. We have done that. I think there are about five or six points in that section. They do not all apply to each country. Some of them will apply to every country, but we have set out that framework and then said, really rather for the political reason which indicated that each country is different and you have to look at it for what that country is and the problems it has, and you have to look at it in the light of its own specific problems. Mexico … are you from Mexico?
Question
Yes, I am.
Prime Minister
Yes. Well, you know, Mexico has made enormous strides in tackling her underlying problems with great courage and I believe just two days ago she did get a longer-term re-scheduling of debt which we hope helps her. It will take a longer time to repay, but it is partly because she has done so much herself to restore confidence. So what we have tried to lay out is a framework and some criteria which will apply to those developing countries and then they are applied according to the specific circumstances of that country.
They recognise two factors: that the debtor country has to make considerable efforts, as Mexico is doing, to solve its problems, and then also, of course, the banks have their problems to deal with, and in my speech yesterday I said that they would have to look at ways of strengthening their balance sheet.
So I hope we have got an economic framework and criteria and that the application of those criteria will take into account the political difficulties, circumstances, problems of the countries to which the framework applies.
Question (Dave Mason, AP)
Prime Minister, are you at all disappointed with the statement on terrorism? It seems to be more an expression of concern, with proposals instead of firm action or mechanisms to combat terrorism.
Prime Minister
No, I am not disappointed with it. I know all of the problems, but I know that above all we have to have a much closer exchange of information and a much closer co-operation between countries and that, I think, is what this sets out to achieve.
Question (World-Watch Magazine)
—Prime Minister, you refer in the communique by Heads of Government that you should strengthen the role of the IBID and could you or the Chancellor perhaps be more specific in explaining that. [end p3]
Prime Minister
I think in one's earlier speech, one pointed out that you could use some of the public money as a catalyst to stimulate private investment as well and that that might in fact get larger amounts of help to some of those countries who need it. To some extent, that is already done, but not sufficiently and we believe that that aspect of its work could be strengthened.
Question
Prime Minister, the communique refers to the need to reduce Federal deficits where necessary. My question is: is the United States one of the places where that is necessary and is the United States taking adequate steps to do that?
Prime Minister
I think you should address that question to the United States. I think, if you look at the percentage of GDP which is represented by the deficit, you will find quite a number of countries may wish to reduce their deficit, so it does not necessarily apply only to one country but to quite a number. We have, after all, taken strenuous steps to reduce our own deficit, thank goodness, so we are not in an acute position and we will go on trying to hold down our deficit, but it is done, really, by a variety of ways: trying to hold your public expenditure and then trying to cover a reasonable amount of it by taxation so that you are borrowing—that is your actual deficit—is kept to fairly low percentage terms of your GDP. I am not going to mention any countries. You must ask each of them.
Question
Prime Minister, I would like to follow up on the subject of terrorism. American officials have said that they felt that private agreements were more important than public statements. Really, a two-part question:
Prime Minister
Well, if there are private agreements on concrete action, by definition a private agreement is a private agreement and I will not refer to it. What I think we have done publicly is to show our joint concern about this and willingness, indeed determination, to do as much jointly as we possibly can to defeat this thing, which is the scourge of many people's lives.
Question (Jerry Lewis, BPA)
Prime Minister, are you not a little disappointed with the statement on the Iran-Iraq Gulf War? Does it not mean that the seven leading statesmen of the world cannot find a solution or impose a solution on these two countries? Surely there must be some way round this particular problem?
Prime Minister
Really, your last sentence illustrates what is the answer to your own question. I do not find it surprising that you cannot impose a solution on two countries. Nor, I think, on reflection, would you. I think it is a matter of great concern; it is a matter of great sorrow. The loss of life, particularly of young people there is enormous, but you cannot impose a settlement on those two countries. There is no way in which you can do it, anymore than we were ever able to avoid the terrible slaughter that took place in Cambodia. Many of us felt deeply concerned and with all the international institutions we could not stop that. [end p4]
One is deeply concerned, but it is in fact a fact of life and it is a realistic fact which I am sure you face just as much as we have to. We still continue to do everything we can, but it is not enough to stop the hostilities and conflict between those two countries. That will only come when they themselves are prepared to negotiate to stop it and have the will to stop it.
Question (Max Wilkinson—Financial Times)
Prime Minister, in the section dealing with the problems of the debtor nations …?
Prime Minister
You have come a long way since education, haven't you?
Question
I could return the compliment.
Prime Minister
Yes, indeed! We were both together on education ten years ago.
Question
On the section dealing with international debt, in paragraph 5 of the communique, you left out the section about the multi-year rescheduling of official debt when you were reading it out. Was there any significance in that? It seems to be rather an important part of the communique.
Prime Minister
No, I am sure I read out multi-year rescheduling, but I might have cut it down. Frankly, when you are reading this thing through, you realise how long it is. When you are going through it, everyone is straining to get their bits in and to get a complete section. When you are reading it through you realise that you are going to be there rather long if you read out absolutely everything. But I am sure that I did read it out. Yes, I read out the first part of that and then I just dropped the last three lines which were not absolutely vital to the reading out of it. But the communique stands. But I think I saved people at least five minutes of listening time by doing some quick editing as I was going through, but the communique stands as a whole even correspondent to pick that up.
Question
Prime Minister, perhaps Chancellor Lawson will want to answer this as well. I am wondering if there was a sense of whether the IMF is currently adequately funded or whether, particularly with a large number of debt repayments coming due in a bunch in 1986/87, whether there will have to be more money put into that agency.
Prime Minister
That, as you know, is being reconsidered in September 1984. It is not long since we increased the funds available to the IMF by 50%;.
Nigel LawsonChancellor
That was in February 1983. There is no need for additional funds at the present time. The Managing Director is not asking the countries to put up extra funds at the present time. There will obviously come a time, as you look ahead, when there will be a need for further funds, but that time is not yet.
Question (Edwin Roth)
Prime Minister, you will probably like this question. A very distinguished writer, one of the distinguished writers in the world, Lew Kopelew, who was born in the Soviet Union, has expressed [end p5] considerable disgust at the fact that the West does not seem to care for Sakharov. Why was not Andrei Sakharov mentioned in that statement so that his treatment should have been exposed to a little more contempt than it already has?
Prime Minister
I do not think we need to mention Andrei Sakharov in a statement to give greater exposure to his case, because we all of us frequently mentioned it and have done everything we can to make representations that he should be properly treated and his wife should have the requisite medical treatment. So I do not think we needed to deal with it in this statement. This, after all, is an economic statement and it did not seem appropriate to mention specific cases in one on East-West relations without also mentioning many other cases.
Question (John Dickie “Daily Mail” )
Prime Minister, what is the basic objective of the Declaration on East-West relations? One accepts your good intentions but is it realistic to expect the Soviet Union to come back to the negotiating table before November?.
Prime Minister
Whether it is realistic or not, we meet once a year and we have to express our views as they are and the views really are threefold. One, the total unity and solidarity and determination of the Western countries; the wish, nevertheless, to have dialogue across the East-West divide, believing that the avoidance of conflict is in the interests both of East and West. That is absolutely clear and the third one that it was the Soviet Union that walked out of the Nuclear Disarmament Talks. The United States has indicated that she will go back to the table without pre-conditions and we hope to get some response before very long to return to the negotiating table. Whether that is before or after November, your views may well be the realistic ones.
Question
Prime Minister, what is going to happen to interest rates and unemployment?
Prime Minister
It would be a very unwise Prime Minister who would say anything about interest rates. As you know, it is always asked and never answered.
On unemployment, we seek to do as much as we can for job creation. You will know that we have to create quite a lot of jobs even to stand still on unemployment, because the demographic curve in this country is such that in the last six years we have had one million more people of working age in the population than previously, and the increase of numbers of people in the working population will continue until 1989. It is because of the extra numbers of children leaving school compared with those who are retiring. So we have to go as fast as we can on trying to create extra jobs and having the kind of financial system and help which enables genuine jobs to be created. We had quite a long discussion about this in the Summit. Indeed, a very long and interesting one, and most people find that their extra jobs are coming really from two sources: to some extent the two sources overlap. One is small businesses, and among the small businesses in particular it is businesses in services. So we shall go as fast as we can. [end p6]
Question
Prime Minister, was it the sense of the nations meeting here in the discussion on East-West that deployment of missiles will continue in Europe if the Soviets do not return to the bargaining table to negotiate an agreement?
Prime Minister
It is the anticipation that we shall complete the dual-track decision of NATO and deploy the missiles which we agreed to deploy.
Question
Prime Minister, you told us before the Summit began that we would be blessed if we expected nothing. Now, you are trying to tell us in fact that the Summit accomplished a very great deal. Are we wrong now or were we misguided earlier?.
Prime Minister
No. You had such enormous expectations of brand new, magic solutions that I had to damp those down and therefore I hope, having damped those down you might really be very very pleased with what you actually find in the communique. I had a pretty good idea of what it would be and we managed to deliver it, so I hope you are quite pleased. It would have been terrible if we had delivered all this and had been disappointed. It is much better to have you pleased, I trust.
Question
Prime Minister, which subjects generated the most argument and disagreement?
Prime Minister
Oh goodness me! Genuine debate, I think, is the appropriate term. It is not so much the actual discussion of the subjects which generates the debate. It is when you translate what you think you have agreed to precise language in a communique. Then you will find very considerable debate over two or three words and certainly there was quite a debate on the precise wording we should use in East-West. That was not a fundamental debate. They were really debates of emphasis, rather more than fundamentals.
Question
Why were the specific references to the US budget deficit and to a specific time-table for GATT, that were evident in the draft communique, dropped from the final communique and were you at all disappointed by that?
Prime Minister
No, we have not made any reference to the financial affairs of any particular country at all and I think that that was the best way to take; and on GATT there was a difference of opinion as to whether we should set some kind of time in which the decision should be taken or we should say it should be effected as soon as possible, and some felt it would be wise to set a target for the decision and others were not prepared to do that; they wanted to complete the GATT work programme first and they thought that if we set a target for a decision, some of the other GATT countries might think we were trying to impose one upon them, and of course, we are only a very small part of the GATT apparatus. That was the reason.