Speeches, Interviews & Other Statements

Complete list of 8,000+ Thatcher statements & texts of many of them

1985 May 4 Sa
Margaret Thatcher

Press Conference after Bonn G7 Summit

Document type: Speeches, interviews, etc.
Document kind: Press Conference
Venue: British Press Centre, Room 2501, Lange Eugen, Bonn
Source: Thatcher Archive: COI transcript
Journalist: -
Editorial comments: The Press Conference began at 1630.
Importance ranking: Major
Word count: 4251
Themes: Agriculture, Defence (general), Economy (general discussions), Employment, Industry, Monetary policy, Public spending & borrowing, Trade, European Union (general), Foreign policy (general discussions), Foreign policy (Africa), Foreign policy (Americas excluding USA), Foreign policy (Asia), Foreign policy (development, aid, etc), Foreign policy (USA), Foreign policy (Western Europe - non-EU), Law & order, Science & technology, Terrorism, Transport

Prime Minister

Ladies and Gentlemen,

I think I would characterise this Summit under three heads:

First, you will be aware that the main economic section concentrates on growth and employment. You will have noticed that some of the recipes there to achieve both are very familiar, and it is amazing, and indeed remarkable, that from whatever country we came, from whatever political background, the recipe was the same: we must concentrate on getting inflation down further. That is good, not only for sound money, but also it is the best basis for a policy of rising employment. That we must keep public spending within tight limits; and that we must keep borrowing within reasonable limits; and for those who have too high a deficit for their savings ratio, they should make an effort to get it down. That we should concentrate very much on increasing the number of small businesses and especially in innovatory technology in the manufacturing area. That recipe came out from every single country.

In addition to those, we each undertook to do our own particular things which we thought were especially important for us. You will have noticed the United States determination to reduce its budget and the need for Japan to open its market more and [end p1] Europe's need is really to introduce greater flexibility into our economies. The phrase, I am afraid, “structural rigidities” , terrible jargon as it is, was heard frequently and often, and also we are very much aware that in Europe we have not got the new technologies to the same extent that the United States has, nor the rate of formation of new business and small business.

The second main section of the communique, as you will be aware, concerns developing countries. It is quite true that that concentrated on Africa, because we are all very much aware of its needs because of famine and drought. Much of the discussion went on things such as the need to ensure that the food that is provided gets through to the people for whom it is intended, because there have been stories of the food not getting to those who are really hungry and, as you know, both in the EEC and in Great Britain, we have been helping very much with transport—ourselves, particularly with aircraft—to see that the food gets through.

We are also aware that it is not only a matter of the relief of famine, but very much a need to help with the underlying development of proper agricultural policies which conserve the soil and which ensure that food is grown on a proper and continuous basis. So we are not merely looking at the relief of famine; we are looking at policies which enable them to develop a healthy agriculture.

The third section dealt especially with trading and monetary policy. On trading, everyone stressed again and again that protectionism would be damaging for world trade and would [end p2] be damaging for each and every one of us. We also admit that each and every one of us has some protectionism and that, really, we would like to have a new round of GATT to discuss these matters.

We were not wholly agreed on when the new round of GATT should be, but are agreed that preparatory steps should be taken this July in Geneva with the Preparatory Meeting of GATT, and we hope that those preliminary steps will be completed as soon as possible and the agenda complete, so that the majority of us were quite prepared to say that we believe there would be and should be a new GATT round in the first half of 1986.

On other matters, you will already have had the Political Declaration of Forty Years On, and you will be aware that, at our first evening, we had a very thorough discussion on drugs.

I certainly was very concerned about it and asked about how Mrs. Reagan 's drug conference had gone. Immediately, it became obvious that other countries are extremely worried about the amount of heroin and cocaine and quite determined to stop the drug traffickers by all powers within our means and do everything possible to dissuade young people from taking drugs and point out the tragic and horrific consequences if they do.

We are trying to cooperate as much as we can. We have set up a committee of experts to report in September, because as you will be aware, Foreign Ministers will be meeting in September at the United Nations. They can perhaps consider the report of experts then. But the subject was debated at length, because of the great concern that we all shared about it and a determination to stop the drug traffickers and to try [end p3] to diminish the number of customers for those terrible things.

I think perhaps that sums up this Summit. I think we should ask for your questions now. [end p4]

Michael Brunson

Prime Minister, were you very disappointed that a date for the start of a new GATT round was not agreed?

Prime Minister

Well, we cannot ourselves fix a new date for the GATT round. That has to be done by all of the Ministers for GATT. What we can do is to give a lead about when we think it should be and undertake that, as far as we are concerned, we will try to complete all of the preparatory arrangements in time for a new GATT round to take place in the first half of 1986. We are all agreed on completing the preparatory arrangements as soon as possible. The overwhelming majority of us were prepared to say that as far as we were concerned we thought the new GATT round should be in the first half of 1986. I think most of us believe—whether we are prepared to prophesy that particular thing on not—that there will very likely be a new GATT round during the course of next year.

Michael Brunson

Would that…   .been further, had all of you agreed to a date?

Prime Minister

The overwhelming majority of us agreed. It is not for me to over-persuade someone who could not agree to it. That is a matter for them. [end p5]

Question

Has this Summit, Prime Minister, eased or deepened fears of growing protectionism, to which you referred?

Prime Minister

I think it would be only fair to say that we are all so aware of the dangers of protectionism that we are all determined to do as much as we can to prevent it, and we are all very much aware that each of us has some. We have protectionism on steel, so does the United States. We have protectionism, in a way, in that our agricultural policy is protectionist. We have a multi-fibre agreement. The United States has certain aspects of protectionism. Japan, as you know, it is very difficult to get into her markets and we are particularly aware that we need to discuss services in GATT.

We are all aware of this. We are all aware how damaging it could be for each and every one of our countries if any of us takes protectionism any further, and so we all think that we need a new GATT. The only difference is whether we are prepared to say we think it should be in the first six months of next year or whether we are not prepared to commit ourselves to that. That is the only difference and it really is very small indeed.

Max Wilkinson

Prime Minister, what did you understand to be M. Mitterrand 's objections to the majority view and what are your arguments against him? [end p6]

Prime Minister

I think you must ask M. Mitterrand about that. I think he perhaps took the view that whether there should be a GATT round—new GATT round—in the first six months of 1986 really should be determined by GATT itself. We said: “Yes, of course. That includes the developing countries, but we are seven very important western industrialised countries here and it would help enormously if we gave a lead and undertook to get the preparatory arrangements through as quickly as possible and to try to influence others in the same direction.”

The argument was really on a very narrow point and I think it is much much more important that we were all conscious of the need to stop protectionism, than the particular difference between us.

Question

And French agriculture, was that a factor?

Prime Minister

Agriculture is one of the things that is being dealt with in the six working parties which are already under way. I do not think that any of us think that it is likely or wish it to be dealt with as the first thing at GATT. There are other things that I think should perhaps be dealt with first. [end p7]

Question

Prime Minister, you spoke of the need to concentrate on innovative technology. Does this mean that you personally can embrace…   .contracts in the Strategic Defence Initiative and, secondly, do you support the idea that Britain endorse M. Jacques Delors ' plan to double the size of the Community Research and Development Programme?

Prime Minister

First, we have made our views on SDI, as you know, very clear, in the Camp David Four Points which has been endorsed again and again both by us and also by President Reagan, and we have said that we would like to have a part in the research. So our point is very clear on that.

The other one. We discussed that at the last European Council, but you know it is only last December since all countries in the Research Council of the European Council set the future programme and agreed upon it—only last December—and I do think that we cannot suddenly upset it. As far as we are concerned in the United Kingdom, we do have considerable sums spent to try to help innovative technology, in particular I would just remind you of the ALVI programme, which is a joint partnership between Government money and industry, because as you know, our research is excellent, our inventiveness is excellent. Where the United States and Japan beat us every time is in translating the results of our research and the results of our inventive genius into their profits, and we want, you know, the translation and the cooperation between our excellent university research and business research to be much more profitable in securing the [end p8] benefits of our researches, our inventions, for our people and our jobs.

Dave Mason

Prime Minister, unless I am mistaken, there is no mention at all in any of the documents we have about terrorism, whereas last year in London there was a considerable point made over it.

Prime Minister

There is no mention in the communique, no. We had an excellent communique about it last year and it has been taken forward during the course of the year and Foreign Ministers discussed it during their separate meetings, but I do not think there is any further statement to make.

We shall continue to fight it with all possible means at our disposal and continue to cooperate very closely with other countries.

Foreign Secretary

We did discuss it, in fact, amongst Foreign Ministers, and we agreed on the importance of extending and sustaining our cooperation and Herr Genscher did report that yesterday. We attach importance to continuing the implementation of what we agreed last year and in Dublin last September. [end p9]

Question

Your Secretary quoted his school song to me at some length. Yesterday, I watched you marching with the Prussian Present March to a German guard of honour and today you sat under an enormous German eagle. You were a teenager during the War—you were 14, I think, when it broke out. What are your thoughts on that, forty years on?

Prime Minister

The thoughts which I expressed when we last had a bilateral here. The Federal Republic of Germany and the western countries are allies in NATO. Freedom began for the Federal Republic of Germany at the end of the last War. They are now our very staunch allies and what we want above all is to work together in peace and reconciliation so that there shall never be another war. That is best achieved under the NATO alliance that we have and by considerable and continuous contact between each and every one of us, both in bilaterals and in these multilateral organisations.

Question

Do you think they are better for these Summits?

Prime Minister

Yes I do. Just look at this one! Not a word about reflation, because the people actually in charge of governments know that that is only a recipe to give more trouble for the future. Every single one of them on plain straightforward sound policies, because they are sound, and because they can be sustained. [end p10]

Question

I did not mean that!

Prime Minister

Well I did! I did!

Question

…too much of a show, like an ox being roasted on a spit, for instance.

Prime Minister

No, no! I hope you did not feel that that applied to you here. It certainly did not to us.

Question

You seem to have taken a considerable step forward on the Channel Tunnel at this meeting. Do you envisage an early start on the Tunnel?

Prime Minister

I am always, whenever I meet President Mitterrand, very anxious to do as much as we can to get that forward. As you know, it is not something that is going to involve government expenditure. Probably certain parameters have to be set by governments, certain things have to be satisfied and, of course, there would be some expenditure in access roads and so on.

Why I am really keen on it is that I would very much like our generation to do something which is exciting, which in fact, we shall be able to point to as a contribution of our generation and I think contact between the mainland of Europe and [end p11] the United Kingdom will be helped tremendously. It will not be an exclusive highway or railway, because obviously the ferries will still go and some of them might sometimes be cheaper than going through another way, but I would very much like it to go ahead.

We still have to decide between the three possible ways to do it, but I would like to feel that by the year 2000 it was up and working, so I am always trying to get it on a bit or forward a bit faster.

Question

The Continent will no longer be isolated then.

Prime Minister

You make your point beautifully!

Question

Prime Minister, Chancellor Kohl said in his preamble to the Declaration that the Summit discussions had been controversial. Do you share that assessment, and if so do you think it was solely because of the French position on a global trade round?

Prime Minister

On the broad, general economic front and on the need to combat protectionism they were not controversial at all. The unanimity was remarkable and also on the Forty Years On the unanimity again was remarkable. So the controversy only came on some of the precise methods of achieving our aims and really, it was small compared with the degree of agreement. I know that it [end p12] is not welcome for you, but it is welcome for the peoples of the countries we represent.

Question

Prime Minister, in the final communique, there is no mention of the Cartegina (phon.) consensus letter which was mailed to all the leaders prior to the meeting. There is mention on the LDC situation, very specific mention to Africa. Is that a priority that will be carried forth?

Prime Minister

No, there was no mention of that particular letter. Certainly, I think Africa is very much in our minds, but as far as the debt countries, which I think is what you are after with your other comment, we carry on. There is a sentence in the communique which says that so far we have dealt with it on a case-by-case basis and so far our efforts have been effective and we shall continue on that basis. But certainly, Africa stands out so much because of the drought, continued drought in some areas, and famine and the tremendous emotional efforts that have been made because they have seen on television what has been happening in Africa. And also, the strength of feeling that sometimes their efforts may not quite reach the people concerned. We have concentrated on that.

There is another sentence somewhere in the communique about those countries which are neither the poorest—which of course are already dealt with by the World Bank—but which are in considerable difficulty, like some of the Caribbean nations, and [end p13] they are not able to get loans on terms which enable them to take them up. There is a sentence there about those in what is called the “third window” .

Chancellor of the Exchequer

I believe it is the intention of Chancellor Kohl to reply by letter to the Chairman of the Cartegina Group after the Conference, just as Mrs. Thatcher replied by letter after the London Conference to similar advances made from the Latin American countries prior to the London Summit.

Prime Minister

We actually, as you know, made international debt quite a centre-piece of our conference last year, because that was the immediate need then, just as the need to prevent protectionism is the immediate one now.

Question

Would we be safe in assuming that as regards the major industrial countries, the notion that there exists a crisis as viewed in Latin America, no longer is the case? [end p14]

Prime Minister

I am always hesitant to use the word “crisis” , but the debt situation has not yet been solved. None of us would say that it has. We think the way to deal with it is as we have in the past, on a case-by-case basis, because the circumstances of each country are different and therefore you have to deal with it on a case-by-case basis, but you also have to deal with it in association with an IMF programme, because that is very important too.

Chancellor of the Exchequer

We had a long discussion of the debt issue among the Finance Ministers. We acknowledged a very real problem and it is indeed referred to in paragraph 7 of the communique.

Prime Minister

Yes, I say it is not solved. We do use the phrase “Recovery of the industrial countries has begun to spread to the developing world. The debt problems of the developing countries, though far from solved, are being flexibly and effectively addressed.” Far from solved.

Question

Prime Minister, you spent a very long time discussing the date of the new GATT round. Does this mean that there were any subjects that you would have liked to have seen this Summit discuss that had to be dropped? [end p15]

Prime Minister

No, we were fairly thorough in our discussions. It is, as far as we are concerned, an Economic Summit, and therefore we tend to discuss other subjects in the margins over meals and at bilateral meetings.

The difficulty is you can be agreed in generality but you still have quite a lot of argument over the particular words used in the communique, and that is where the argument comes.

Question

Prime Minister, after listening to President Reagan's review of economic developments in his country, are you satisfied that the United States will make real progress towards reducing its budget deficit this year?

Prime Minister

That is their objective. I believe they will make progress in decreasing their budget deficit this year. Precisely how much, I cannot foretell. But I think they are aware of the need to do it. The Administration has been aware for a long time. I believe that Congress is aware of the need to do it and I think that they will take certain steps to achieve a reduction in the deficit. To achieve it by their actions this year, of course they are talking about the effect on it next year and in future years.

Question

Prime Minister, in the final communique, you were already referring to the section on help for the poorer though not [end p16] debtor nations. Do you take that communique to mean support for the Canadian “third window” option?

Prime Minister

We have mentioned it as being something which, within the present resources of the World Bank, attention should be given, and so we have added that: “We remain concerned there are particular problems facing a number of developing countries who are neither among the poorest nor foremost among the group of major debtors. We agree that consideration should be given to easing the financial constraints of these countries on a case-by-case basis.” That will be within the existing resources of the World Bank.

I think we are anxious to point out that the countries which need our attention are not confined to Africa, but we are also thinking of others as well, and of course, even beyond that “third window” .

Question

If I may come back, I believe that the Canadian proposal was very specific about the type of aid that it wanted to see given.

Prime Minister

That was the Canadian proposal, the one that is in the communique. [end p17]

Max Wilkinson

Prime Minister, could you tell us what were the results of your talks with Mr. Nakasone about opening up Japanese trade?

Prime Minister

They are yet to occur. I am hoping to get back to them on time.

Geoffrey Goodman

Prime Minister, in view of the importance you attach to the drugs problem, is there any particular reference to this in the communique?

Prime Minister

Because you will see that the communique is really the economic communique and it would be surprising if, on a thing that is not an economic matter, on a thing which had not been advertised in advance at all—it was brought up because I brought it up; we were all concerned—it would be surprising if it were in the communique, but after all, we are setting up this committee of experts which will report in September. I do not think you would have expected that in the communique of an economic summit. I think you can be very well satisfied that not only did we have a discussion which showed all of us to be deeply concerned about it, but we have set up a committee among ourselves to report in September, to take action forward. So it is not only discussion—it is action. [end p18]

Question

You are one of the veteran Summit leaders now. Could you give us your assessment of how this one rates with the others in the past?

Prime Minister

Frequently, you know, each Summit has a particular thing that it has to give attention to. Last year, it was international debt. This year it is protectionism. I think at Williamsburg it was that we used an economic summit also very much on the political side, because it was the need to give support for the deployment of Cruise missiles and, of course, we had a political declaration.

It is very much easier at a Summit, when there is an obvious, particular matter for discussion. This one had protectionism. It is much much more difficult when it is continuing what is a sound policy, so I would think that Williamsburg. Oh Versailles, we did of course science and technology. And, of course, you will recall, in the middle of Versailles, that was when Israel went into Lebanon and so we also had other things very much on our minds. I had things very much on my mind because it was Falklands.

They are easier to get across where there is an obvious pressing economic problem. At the moment there are two. One is protectionism and the other is the paradox which is difficult to get over in our countries that although we have to report, each and every one of us, growth in our economies, although each and every one of us had to report good investment, good profits, a record standard of living, nevertheless we have very high unemployment. That is the paradox we have to try to explain to [end p19] our people.

Japan and the United States have managed to solve it, by a much higher rate of formation of small business than we have and, of course, they have much more flexible labour markets. And that is why you will find, in the European Section of the communique, enormous concentration on the need for the rate of formation of small businesses to grow and also concentration on as much as we can do to get what I would call the science-based technological industries. That is the kind of difference between Europe and Canada and on the other hand the United States and Japan.

Question

Was this one more or less successful than the previous ones?

Prime Minister

Oh I think it was successful. I think this was successful.

Question

(inaudible, but refers to Nicaragua)

Prime Minister

It was discussed again in the margins, but it did not loom large—or indeed at all—in our main economic discussions. Foreign Ministers discussed it and obviously, I in my talks with President Reagan at various times discussed it, but it did not loom large in our discussions as a conference. [end p20]

Question

Prime Minister, listening to Chancellor Kohl reading that communique in German and sitting on your side of the Parliament Hall, I almost felt I could see angel's wings sprouting on all of you as these beautiful…

Prime Minister

You must have been having some hallucinations!

Question

Yes, those words about the Third World, ecology. Is it really all that beautiful? One almost expected harp music in accompaniment of those beautiful words that kept on rolling along.

Prime Minister

Well, I congratulate you on your vivid imagination! I saw a very workmanlike job being reported in a communique.

Bernard Ingham

And on that celestial note, we will conclude. Thank you.