Britain’s Principal Global Economic Goals

08Apr16

An extract from Unpeople: Britain’s Secret Human Rights Abuses

British planners’ economic goals are revealed with crystal clear clarity in the secret record. A July 1970 report entitled ‘Priorities in our foreign policy’, for example, notes that Britain needs ‘to act in support of our commercial and financial interests throughout the world’ and that:

‘We must contribute within our economic capability to international stability and the protection of our interests in the rest of the world from which so many of our raw materials derive… We shall need to pay particular attention to the Middle East, Southeast Asia and Southern Africa’.

The key to this basic aim is to ensure that other countries establish economic climates favourable to British, and Western, companies. A Foreign Office report from 1968 states that the primary goal of foreign policy is to make Britain economically strong, meaning that ‘we should bend our energies to help produce a world economic climate in which our external trade, our income from invisibles and our balance of payments can prosper’. The key to this is ‘freer’ global trade and ‘increasing our efforts to open up new markets in Europe, Latin America and the Far East’.

Ensuring a favourable investment climate was (and is) especially important for countries where Britain had important oil interests. The Cabinet Office noted in 1958, for example, that one of Britain’s aims was ‘to maintain political conditions favourable to our trading requirements throughout the world, and especially in the Middle East’. An interdepartmental Whitehall group noted in 1968 the ‘need in developing countries for an economic and political climate attractive to expatriate capital, and the advantages of the status quo both to security and to low prices’.

‘The broad aim’, the Foreign Office noted in 1968, ‘is to inhibit undue governmental interference in the international oil trade’. This meant that Britain should ‘oppose, or at least attempt to moderate’ resolutions in the United Nations that would encourage governments to ‘expropriate or acquire too direct a control over Western oil investments’.

British planners were at pains to counter the trend towards nationalisation since ‘expropriation nearly always results in a measure of loss for the UK interests involved’. This policy was promoted in the knowledge that nationalisation was undertaken in ‘the hope that a large share of the profits may be retained locally and increased funds be made available for local investment’. Thus British planners were perfectly aware that in opposing nationalisation they were also opposing likely improvements in the welfare of the people of those countries.

This aim of ensuring favourable investment climates for big business – and countering governments who do not – has been the primary goal of numerous postwar British and US military interventions, in Iran, Kenya, Indonesia, British Guiana, Central America and elsewhere. This is also the very basic root of Britain’s global economic policy, promoted in bilateral ‘aid’ programmes, the World Bank and International Monetary Fund’s ‘structural adjustment’ programmes and in the shaping of the rules of the World Trade Organisation. The consequences of promoting privatisation and liberalisation have often been devastating for hundreds of millions of people around the world as shown, for example, in the effects of ‘shock therapy’ programmes in Eastern Europe and Africa. The most basic of British goals in the world bears significant responsibility for maintaining, often deepening, global poverty – a fact unmentionable in the mainstream political culture.

The files indicate that strategies to address third world poverty are basically to be opposed except where they enhance British business interests. The Foreign Office noted in 1968, for example, that:

‘We should for the time being adopt a “heads down” attitude in regard to proposals which, however, desirable in themselves, would throw a significantly greater strain upon our balance of payments, eg commodity schemes directed primarily to raise prices rather than at stability of markets’.

Another report from the same year, 1968, noted that Britain should assist economic development in the poorest countries ‘especially those which are or can be expected to become important sources of raw materials or important markets for British goods and services’. Britain’s ‘aid’ programme was thus seen as ‘as a weapon in the armoury of foreign policy’, in the words of the Foreign Office in 1958. Ten years later, it similarly stated that:

‘We must ensure that our aid programme supports not only the developmental needs of recipient countries but also our own commercial and foreign policies… Wherever possible we should try to shape our aid programme to fit more appropriately the pattern of our trade and investment interests in different countries’.

This role for ‘aid’ has been long understood by planners: the forerunner of the modern aid programme was the Colonial Development Corporation, which was established after the Second World War ‘to promote and undertake the expansion the supplies for colonial foodstuffs, raw materials and other commodities’, a 1947 Cabinet memorandum reads.

Critical to achieving these basic economic goals is Britain’s political power – or ‘prestige’ or ‘status’ as it is variously referred to in the planning files. Promoting British ‘prestige’ is often seen as important in itself; indeed British planners have traditionally been obsessed with their standing in the world, and this factor has often been more important than economic goals in explaining policy.

The Foreign Office noted in 1958, for example, that ‘there is no alternative to remaining a Power with interests in many parts of the world’ for two reasons. The first is that ‘the UK is not self-sufficient’ and ‘must maintain and expand our level of trade or lose our standard of life’. The second is that ‘our prosperity is closely linked to the maintenance of the Sterling Area [the large part of the world where the pound was the then the dominant currency] and to the status of the pound’. Both of these depended on ‘our ability to preserve our influence in the world’.

As the Foreign Office noted in 1968:

‘For the foreseeable future our direct economic worldwide interests will require us to do what we can to maintain and increase our existing influence outside Europe. Indeed, in terms of stark economic interest, we cannot afford to lose such influence’.

In 1950, at a time when Britain was increasingly being forced to ‘decolonise’, the Foreign Office had warned:

‘If the United Kingdom were voluntarily to abandon her position or political influence in selected areas, she would probably find herself not only without economic access to those areas but unable, through loss of prestige, to prevent a further involuntary decline in her influence elsewhere and consequently a general decline in the strength of the Western powers’.

Eight years later, in 1958, the Foreign Office similarly warned of the dangers of decolonisation occurring too fast:

‘Our remaining colonial territories are likely to be in many, if not most years, net contributors to our gold and dollar reserves. Premature withdrawal would lead to collapse of markets and sources of supply for the United Kingdom’.

However, ‘timely grants of independence would not endanger economic links with the United Kingdom’ which were seen as ‘sacrifices to maximise long term investment in colonies’.

Maintaining such ‘great power’ status will only come at a price. The Cabinet Office noted in 1960, for example, that:

‘There are many desirable ways of using our resources at home, especially the    improvement of our standard of living through better social services and the increasing of our wealth through productive investment. But we cannot exert  influence in the world unless we devote resources sufficient to underwrite our  external responsibilities’.

Therefore, the price for the British elite to maintain its global prestige will be paid by the general public. The £3 billion forked out for invading and occupying Iraq is but the recent cost.

Possessing nuclear weapons is another way British elites maintain their status in the world. The Cabinet Office in 1960, for example, noted that in the 1950s ‘our influence throughout the world was enhanced’ by ‘being a nuclear power with a significant potential both in weapons and delivery systems’. It noted that ‘unilateral nuclear disarmament is, of course, within our power’ but this would threaten Britain’s security and ‘would undermine our standing in the Atlantic Alliance and in the world as a whole’. It was largely to uphold the British position with the US that Attlee’s Labour government acquired nuclear weapons after the war.

The twin goals of ensuring favourable investment climates and maintaining ‘great power’ status have been especially important in three key regions – the Middle East, Southeast Asia and Southern Africa. In the Middle East, oil has of course been of paramount importance; the Foreign Office had described the region’s oil in 1947 as ‘a vital prize for any power interested in world influence or domination’. The need to maintain vast profits from the operations of British oil companies was considered in chapter 4. Prime Minister Harold Wilson’s private secretary, Oliver Wright, noted in 1964 that:

‘We have really only two interests in the Middle East. The first is access on reasonable terms to Middle East oil. The second is overflying rights across the Middle East barrier so that we may get to the other parts of the world where our presence is necessary’.

In the Middle East as elsewhere the British strategy under ‘decolonisation’ was to ensure that power passed to local clients. In this way, control over oil could be maintained. The Cabinet Office noted in 1958, for example, that in the Middle East many countries have:

‘… evolved to a point which makes it impossible to subject them to further tutelage… The basic task which confronts the United Kingdom in the Middle East is thus to pass smoothly from the previous patron-client relationship, suitable to our former strategic needs, to a new and more equally balanced commercial relationship which will preserve for as long as possible the continued supply of oil as a mutually advantageous basis of trade’.

Not only Arab countries but also Iran was important for oil. Indeed, Iran had a particular importance, as the Joint Intelligence Committee noted in 1961:

‘Iran is the only source of Middle Eastern oil which is not under the control of an Arab government, and present production could be considerably increased in an emergency. This strengthens the West’s hand vis-à-vis the Arab oil producing countries’.

Noticeably absent from the government’s planning record is anything about the concerns of the people of the region. Nowhere that I have seen in any of these files, covering several decades, are the interests or wishes of the inhabitants of the Middle East even considered, let alone a major factor in policy-making.

Southeast Asia was also recognised as critical, mainly owing to British investments in the region, notably Malaya. The war in Malaya in the 1950s was described by the Foreign Office as ‘very much in defence of [the] rubber industry’. It was fought at a time when Malaya was the largest net earner of dollars in the sterling area, due mainly to its rubber and tin exports, then partly in the hands of British companies. By 1962, British companies had invested £810 million in Southeast Asia. A Foreign Office paper noted two other interests in the region – that sea and air routes from Britain to Australia and New Zealand pass through it, and that it was a ‘conspicuous battlefield in the cold war’.

Southern Africa, and especially South Africa, has always been of primary importance to British planners as a field for commercial investment – a priority which was never seriously upset through the long decades of apartheid. A Foreign Office paper from 1964 notes that in 1961 the return on British investment in the region was £124 million – 26 per cent of the global total. A Cabinet Office study of 1959 summed up the role of Southern Africa:

‘General interests of the West will be: (1) excluding Sino-Soviet infiltration and keeping local governments and populations on our side or, at least, benevolently neutral; (2) developing trade and guarding access to raw materials’.

A 1967 Cabinet Office report noted two big political issues of the time – the international debates over the racist regimes in Rhodesia and South Africa – and stated that ‘apart from this our major interests in both Middle and Southern Africa in the long run are economic and are substantial’. ‘Our only political interest’ in the region, it added, ‘is to do what we can to create conditions… in which we can pursue our important economic interests to the best advantage’. This meant that ‘we should positively seek to create in Middle African states an atmosphere conducive to British trade and investment and to the presence of British nationals’.

As regards apartheid South Africa, ‘we should continue to make it clear… that we cannot contemplate economic or political warfare with South Africa’. Rather, South Africa ‘is likely to remain impregnable for a long time to come and must therefore be left to evolve in whatever way her own internal pressures dictate’, while ‘we are prepared to do business with South Africa and the Portuguese colonies’, referring to Mozambique and Angola. The most important issue overall was to ‘have regard to the protection of our investments and other economic interests’.

If anyone believes that the interests of mere Africans have ever had anything to do with British policy towards Africa, they should read these files.

Seeing Africa primarily as a source of raw materials and a field for investment was a direct continuation of pre-war and immediate postwar policy. Foreign Secretary Ernest Bevin noted in 1948, for example, that the basic need was ‘to develop the African continent and to make its resources available to all’ (ie, us). This echoed the view of Field Marshall Montgomery, who the previous year had noted the ‘immense possibilities that exist in British Africa for development’ and ‘the use to which such development could be put to enable Great Britain to maintain her standard of living, and to survive’. ‘These lands contain everything we need’, he wrote, such as minerals, food and labour. But, he said, ‘there must be a grand design for African development as a whole’. Britain needed to develop the continent since the African ‘is a complete savage and is quite incapable of the developing the country [sic] himself’.

Latin America was even more starkly viewed as simply a source of raw materials. A 1958 Foreign Office paper noted, for example, two British aims:

‘(1) Promotion of trade and good relations. Latin America is an important source of raw materials for the United Kingdom and in some cases might become a vital one if the delivery of supplies from other parts of the world were to be interrupted, eg, oil, tin, copper and meat; (2) The retention in the Western camp of an economically rich area which has comparatively secure communications and is at present opposed to communist penetration’.

 

This is an extract from Chapter 8 of Mark Curtis’ book, Unpeople: Britain’s Secret Human Rights Abuses, where the full references can be found.



5 Responses to “Britain’s Principal Global Economic Goals”

  1. 1 Cynthia King

    Excellent, informative: have tweeted it far and wide. Just the kind of information everyone needs… Thank you very much.

    Cynthia King Climate Revolution Vivienne Westwood Ltd 9-15 Elcho Street London SW11 4AU +44 (0)20 79152486 (direct) +44 (0)20 7924 4747 +44 (0)777 1656457 http://www.climaterevolution.co.uk http://www.facebook.com/jointheclimaterevolution http://www.twitter.com/ ClimateRevcynth

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  2. 2 Theresa

    Thank you Mark. You need to send this to the Chairman of Wetherspoon’s.
    http://www.theguardian.com/world/2016/mar/26/staying-in-eu-bad-for-small-businesses-says-wetherspoon-chief

  3. 3 Stephen

    So what should British Policy be? To make sure British companies overseas activites fail, lose exports, sack UK workers, get all our overseas investments nationalised, stop using oil or gas. The trouble with being a scourge of British foreign and economic policies is that you need to show what the alternative is, how it would work and meet UK residents aspirations.


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  2. 2 Culture and Conflict in Iraq: Do Our Governments Care About Iraqis, Let Alone Their Culture? | The Swinish Multitude

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