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Oral Question (Treasury): Economic Policy

25 February 2013

Sir Tony Baldry (Banbury) (Con): Is it not correct that even before the crisis struck we had pretty much the biggest structural deficit in the world as a consequence of the previous Government’s policies? It is no wonder that we have been losing ground to economies such as those of India and China. It is only if we stick to our guns that we will sort out our position to become increasingly internationally competitive with other economies.

Mr Osborne: My hon. Friend is right. The UK had the highest structural deficit of the G7 going into the financial crisis. That was confirmed by the IMF just before Christmas. He is also right about our trade patterns. When this Government came to office we were exporting more to Ireland than to the BRIC countries—Brazil, Russia, India and China—combined. We are seeking to expand our trade with those countries and it has been going up markedly. I think there has been an almost 100% increase in our trade with China and, of course, the Prime Minister led a high-powered business delegation to India only last week.