Below is the text of Mr Major’s speech to British Businessmen in Jedda on Monday 19th September 1994.
Patrick, thank you very much! I have to say to you that it says nothing about being eccentric as an expatriate but if you think being an expatriate is eccentric, how eccentric is it to cease being an expatriate and go into politics? That I must tell you is real eccentricity!
Let me just say a few words this morning in the brief time we have got together and then I would like to leave as much of the time as we can for whatever questions you have.
Let me say firstly I am delighted to see so many of you here this morning and delighted to be here myself. I had last evening a very lengthy audience with King Fahd following the banquet that he most generously gave in my honour and one thing strikes me always when I come back to Saudi Arabia – and it was certainly very evident in our discussions last evening – and that is the truly excellent state of relations between Saudi Arabia and the United Kingdom. I say that not as a matter of form but as a matter of fact. Those relations are excellent in their warmth, in their breadth, in their depth, diplomatically, politically and in terms of trade and commerce and we speak to each other, the United Kingdom and Saudi Arabia, over many years as friends with common interests in the region and common interests in the world that bind us together and we share a particular concern for the continued stability of the Gulf to which we make a substantial contribution whether on the ground or in New York at the United Nations.
More recently of course we have kept in touch on a range of matters, about events in Yemen during the civil war, so the first thing that I would like to assure you of this morning is that you will be able to continue to work here in Saudi Arabia against the background of an excellent political relationship at all levels. We are determined that that will remain the case.
The trading relationship, you know as much as I do of that but let me simply say that the relationship between our two countries as far as trade is concerned is flourishing as never before. We export goods and services worth close to 2 billion pounds a year to Saudi Arabia, total trade is over 3 billion pounds a year; Saudi Arabia is our largest export market outside the OECD with the single exception of that rather special case of Hong Kong and what is becoming increasingly satisfactory is that this is becoming increasingly a two-way relationship. We are delighted that high-quality Saudi goods were on show last week in London at Olympia and I know that British companies are looking hard at the opportunities to invest in Saudi Arabia through joint ventures and our OFFSET programme is designed specifically to assist this. We believe that we have a great deal to offer that may assist Saudi Arabia from our experience in privatisation and I have made it clear to the Custodian that such experience as we have is available upon request to the kingdom of Saudi Arabia. On this occasion, this is all too brief a visit but I had the very clear impression that it strengthened yet further the already close bonds that exist between Britain and Saudi Arabia.
Let me turn to a few British matters for a moment before I take questions and I would like to say just a few words about the British economy.
There has been a continuing change for some time but I think perhaps the scale of the opportunities that lie immediately ahead of us is not wholly appreciated, I doubt yet that it is wholly appreciated domestically and certainly not internationally. Britain, I believe, is at an historic turning point. We are now standing at the threshold of an economic recovery unlike any we have seen since the Second World War and we are determined that this is going to be a recovery without inflation, a recovery that will last, a recovery for the long term, a recovery that will provide the springboard to our exporters to capture and then hold for the long term foreign markets and I say that after a careful examination of the facts and it is worth perhaps setting some of them out very briefly:
Total national output has now risen for over two years; manufacturing output is now 4% higher than a year ago; we have the fastest-growing industrial production of all major European Union countries and the IMF, OECD and ourselves expect this happy trend to continue in 1995.
Our export volumes are hitting record levels, they are 10% higher than a year ago and are outpacing imports. Inflation is at a low not seen for a generation and well below the average of our European Union competitors and not many of you experienced businessmen will recall that circumstance on many occasions in the past.
Investment is up 6% higher than just a year ago; consumer demand is now growing at around 3% a year; and unemployment has just taken another big tumble – overall it is now 380,000 lower than its peak at the very end of 1992.
They are very encouraging statistics and the whole range of them suggests that this is a broadly-based recovery that is set to last. Of course, not every statistic on every occasion is going to be a good one, that is not the way the real world works, but the overall direction is perfectly clear: Britain is securely on course for long-term economic recovery based on sustainable growth, low inflation and sound public finances and we are determined to keep it that way.
Almost every previous economic recovery we have seen has been wrecked by overheating. We have seen it time and time again. Frustratingly, when things start to go right, they suddenly go too right too quickly and we have headed off into difficulties yet again.
Let me say this to you quite bluntly: I am determined not to allow this recovery to be endangered in this way. We are going to take no risks whatsoever with inflation. The British public and believe British business as well require stability and predictability in their household budgets, their mortgage repayments, investment decisions and in their export pricing and it is only when they have confidence in that that they will be able to take decisions with confidence for the future and that is what we seek to instil both in the short- and the long-term and that was the reason last week that we moved to raise interest rates by one half-point. The British people and British business need to know that where the Government is concerned short-termism is not going to be an option. We are playing for the long term, long-term prosperity, long-term jobs and long-term growth.
The current recovery – and this is a very welcome development – marked by a very strong performance by our exporters and I think this is one of the reasons why observers see this recovery as being different in kind from any that we have seen before and the Government will do whatever it can, whatever it needs to do, to ensure that this continues and to provide the conditions that will enable British enterprise to go out and beat the competition and continue to beat the competition in markets all around the world.
That was what lay behind the Competitiveness White Paper some time ago; it is why exports play such an important part in it; it is why we will continue to look right across the range of Government activity from the more obvious areas of competitiveness to supply-side changes in education and elsewhere to ensure the long-term competitiveness of British industry in the future; it is why I brought with me on this occasion a very strong team of business leaders – we want to help them utilise the opportunities in major export markets that await an economically resurgent Britain. I am more confident that they will be able to take those opportunities than I have been for very many years and our job as Government is to try and ensure that we maintain the right economic framework, the right levels of confidence, to enable our businessmen and our industry to go out and sell the best of British in every corner of the world. I believe they will do their job providing we do ours and we are determined to do so.
That very briefly is the view from London. It is an optimistic view but it is also the view I hear from foreign observers of the British scene, that rarely have they seen such a favourable combination of economic ingredients. I hope, therefore, that people will begin to build up the confidence that is necessary for them to go out and take advantages of the circumstances that are coming together – I am sure that they will.