European Union (Definition of Treaties) (Partnership and Cooperation Agreement) (Iraq) Order 2014
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Baroness Warsi
That the Grand Committee do consider the European Union (Definition of Treaties) (Partnership and Cooperation Agreement) (Iraq) Order 2014.
Relevant document: 3rd Report from the Joint Committee on Statutory Instruments
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi) (Con)
My Lords, we are today considering the draft orders for partnership and co-operation agreements—PCAs—between the European Union and its member states and four countries; namely, the Republic of the Philippines, the Socialist Republic of Vietnam, Mongolia and the Republic of Iraq.
The purpose of these draft orders is to declare the PCAs to be EU treaties as defined in Section 1(2) of the European Communities Act 1972. They provide a framework for political dialogue and further engagement between the EU, EU member states and each of these four countries in areas including: trade and investment; education, culture and environment; health, science and technology; justice, migration and human rights; and counterterrorism and counterproliferation. Respect for democratic principles, transparency and development are all essential elements of the agreements.
The draft orders that we debate today are a necessary step towards the UK’s ratification of these PCAs and, indeed, the treaties themselves are a necessary precursor to future EU free trade agreements with any of these countries. We have a strategic interest in developing our and the EU’s relationship with Vietnam, the Philippines, Mongolia and Iraq. While we recognise that progress in some areas is slow and challenges remain, we also believe that it is right to recognise the advances made in many areas in these countries including, for example, in the Philippines, which is the fastest growing economy in south-east Asia and too important to be ignored.
HSBC estimates that the Philippines could grow to be the 16th largest economy in the world by 2050. It is a vibrant, stable democracy with a leading role to play in ASEAN and, as the Administration of President Aquino has shown, in bringing peace and stability to the region. The UK is the largest investor in the Philippines, but there is potential for more, and now is the right time to deepen engagement. It is an emerging power, both economically and politically, with which we are keen to work more closely in order to make the most of the promising opportunities for both countries.
Vietnam is also a fast growing economy, an increasingly strong regional force and an important trading partner. The Vietnam PCA supports our bilateral strategic partnership signed in 2010 with Vietnam. It will provide a solid basis upon which we can strengthen ties between the EU and Vietnam, and will also provide the UK with an additional diplomatic tool with which to pursue complex and politically sensitive objectives, including on human rights, which continues to be of concern in Vietnam.
The UK has a strong and long-standing relationship with Mongolia. We celebrated 50 years of diplomatic relations last year. Mongolia shares our values in many areas. It is a member of the Organisation for Security and Co-operation in Europe and a valued contributor to peacekeeping forces in Afghanistan and South Sudan. Mongolia’s “third neighbour” foreign policy seeks to build friendly relations with countries such as the UK in its desire to diversify beyond its two heavyweight neighbours, China and Russia. The PCA would encourage the removal of restrictions to trade and promote measures to improve transparency, thereby helping to build British businesses. It will also support our ongoing work with third parties to embed democratic practice, good governance and respect for human rights.
Finally, I turn to Iraq. Despite the current violence, our hope remains that it will become a stable, prosperous country which plays a constructive role in the region. Greater engagement by both the UK and EU will allow it fully to realise that potential. Iraq successfully held parliamentary elections on 30 April, the third under the 2005 constitution, which demonstrates the commitment of its people to choosing their Government, despite the serious challenges the country faces. Increased co-operation through the framework of the PCA will also help to address many of the underlying causes of the current crisis, such as lack of jobs and access to education and basic services, as well as ensuring confidence in the security and justice systems and respect for human rights.
There is more that the Philippines, Vietnam, Mongolia and Iraq still want to do, and much that we want to encourage them to do. It is important that we continue to seize opportunities, through frameworks such as these agreements, to enable stable, sustainable and democratic states to flourish.
Although all these treaties have been signed, they will enter into force only once all 28 member states of the European Union and the Republic of the Philippines, the Socialist Republic of Vietnam, Mongolia and the Republic of Iraq have ratified them and the EU itself concludes the agreements.
Noble Lords will be aware of the recent European Court of Justice case regarding the Philippines PCA. In some ways, the judgment changes little: the UK will still be bound by the entire agreement once it is concluded either in its own right or as part of the EU, as was always going to be the case. However, the case raises some broader questions as to exactly how the UK is bound and the question of the opt-in. I take this opportunity to assure noble Lords that we are urgently considering these issues.
In conclusion, with specific regard to these PCAs, other countries’ ratification and parliamentary processes are in train. The agreements serve the interests of the UK, as well as the EU, other member states and the four countries concerned. They lay the foundation for stronger, mutually beneficial ties for the future. I commend them to the Committee and I beg to move.
Baroness Morgan of Ely (Lab)
I thank the Minister for that introduction. Developing co-ordinated agreements between the EU and other individual countries is just one of the many benefits of EU membership. Rather than the UK Civil Service spending hours on end developing bilateral relationships with countries around the globe, the EU uses all its combined political clout to negotiate more favourable terms using the political weight of 28 member states. That bargaining power is so much stronger than a bilateral dialogue.
The purposes of partnership and co-operation agreements are to provide a framework for political dialogue, to help strengthen democracies, to encourage the transition to a market economy and to encourage trade and investment. It is often a precursor to a closer trade agreement, which may or may not develop in the longer term.
Free trade is generally considered to be a good thing, and benefits both parties. Under these agreements, countries will accord to one another most-favoured-nation treatment. Nevertheless, it is important that, where possible, we ensure that those benefits are fairly distributed within those countries and that wider questions of human rights and democracy are respected.
Today, here in Parliament, we have an opportunity to determine whether we agree with the negotiation which has been thrashed out on our behalf by the European Commission: a demonstration that this is not a fait accompli until Parliaments across the EU have given their blessing. It is therefore not being imposed upon us in any shape or form. That is a message that we need to ensure that the public hear, loud and clear.
The orders in relation to the countries today and the kinds of areas that are covered were outlined by the Minister. Crucially, in these extremely testing times for Iraq and its authorities, the partnership agreement with Iraq refers to help in facilitating and supporting its stability and regional integration. That is much easier said than done. Al-Maliki’s pronouncement last week has done nothing to give us confidence that he believes in regional integration, despite the pronounced threat by ISIS forces to the stability of his country. What remained of the economy was largely shattered by the 2003 invasion and the subsequent violence. Attacks by insurgents on Iraq’s oil infrastructure have cost the country billions of dollars in lost revenues. Can the Minister therefore explain how the proposed agreement could be implemented in the light of the current security situation?
Since 1990, there has been a transformation in the way that Mongolia has been run, with the introduction of elections and privatisation. However, the withdrawal of Soviet support triggered widespread poverty and unemployment. Nevertheless, there is great hope for the country as it is now one of the world’s fastest growing economies. Its economy increased by 17% in 2011, driven in large part by investment, particularly from its Chinese and Russian neighbours, who are, of course, anxious to get their hands on the vast quantities of untapped mineral wealth.
There is, however, real concern about corruption in the country and it is surprising, perhaps, that this is not a more notable feature of this agreement, as European investors will need to be assured that their investments are secure. Will the Minister explain how this agreement will ensure that the benefits of strong economic growth will be shared more fairly by the whole of the Mongolian population? What pressure can we bring to bear on that?
We all remember the devastating pictures which appeared on our screens in 2013, when Typhoon Haiyan hit the Philippines. The EU was only just establishing and still recruiting for its European External Action Service and was slightly criticised for being slow in its response despite not having much in terms of infrastructure or staff in place at the time. Will the Minister explain how this agreement will help to develop and support the reconstruction efforts following the typhoon? The Philippines also has its own internal political threats. Terrorism attacks by the radical Islamist Abu Sayyaf group, which is linked to al-Qaeda, are frequent in some places. Guerrilla campaigns by the communist New People’s Army were commonplace in certain parts of the country.
The Philippines is perceived as one of the most promising newly industrialised countries, with its export economy moving away from agriculture into electronics, petroleum and other goods. The Philippines has a population of about 96 million people. It has one of the highest birth rates in Asia, and forecasters say the population could double within three decades. However, many leave the country and much of the economy, in the south in particular, is held afloat by remittances sent by people based overseas.
Finally, I turn to Vietnam. It has a population of about 89 million people and remains a one-party communist state. It has one of south-east Asia’s fastest growing economies. Private enterprise is allowed and investment, in particular from the US, has increased, while the country joined the World Trade Organisation in 2007. Of all the countries we are discussing today, Vietnam is the one I have most concerns about in terms of ensuring that any economic benefits of this agreement are felt by the whole population and are fairly distributed. My understanding is that, despite pursuing economic reform, the ruling Communist Party shows little willingness to give up its monopoly on political power.
I am extremely concerned about the situation in relation to human rights in the country, in particular about the treatment by the Government of the ethnic minority hill tribe people, the Montagnards. Amnesty International has voiced concerns in relation to fair trials, so how we can ensure that abuses are monitored and reported upon? What sanctions will occur if this aspect of the agreement is not respected?
Will the Minister also explain whether we can do anything in this agreement to ensure that firms with suspected links to slavery in these countries are rooted out? If the Minister can answer these questions satisfactorily, then my party will support all the proposed partnership and co-operation agreements.
Baroness Warsi
My Lords, I thank the noble Baroness for this interesting debate. She has raised a number of interesting questions in relation to the specific countries. I will deal with them in turn, starting with Vietnam.
The PCA contains a commitment by Vietnam to respect human rights as well as obligations in other areas such as counterterrorism and weapons of mass destruction. Vietnam is a country of concern in the FCO’s annual human rights report, and the PCA will provide an additional channel through which we can pursue UK objectives on human rights. We will continue to raise our concerns with the Vietnamese Government through the biannual EU-Vietnam human rights dialogue and also bilaterally, but this agreement provides us with a further opportunity to do that and raise the very issues to which the noble Baroness has referred.
Our relationship with the Philippines will focus on three key areas: prosperity, including trade and investment; continuing engagement on the Mindanao peace process; and a foreign policy that continues to be closely aligned to the UK’s. We will of course encourage the Philippines, as an emerging power, to become a responsible global player and to use its influence within ASEAN. The PCA will enrich our political engagement with the Philippines, including by consolidating co-operation on democracy, governance and human rights. As the Foreign Secretary has said, human rights and the rule of law are essential tools and indivisible from our national foreign policy objectives. The work in relation to the disputes within the Philippines could again form part of the discussions under the PCA.
The noble Baroness made an incredibly important point in relation to Iraq. Despite the recent instability and the current security crisis, we still believe that Iraq has considerable resource and potential which the international community should help it to realise for both for Iraq’s own interests and for the interests of stability and security in the region. The PCA is the centrepiece for EU and member state involvement with Iraq, and it underlines the EU’s determination to play a significant role in Iraq’s transition. The crisis in Iraq should not prevent us proceeding with ratification of the PCA. Rather, increased co-operation through the framework of the PCA will help us to address many of the underlying causes of the current crisis.
We welcome the PCA relating to market access in Mongolia, in particular through the removal of restrictions to trade and through measures to improve transparency, which was a specific issue raised by the noble Baroness. The PCA also includes provisions for the protection of the EU’s financial interests, which is of particular interest to the UK. The PCA will also help our current work with NGOs and government agencies to embed democratic practice, good governance and respect for human rights, and it will encourage action on climate change.
In conclusion, these draft orders provide us with an opportunity to enhance engagement between EU member states and the Republic of the Philippines, the Socialist Republic of Vietnam, Mongolia and the Republic of Iraq across a broad range of areas. They are testimony to the growing importance of EU links with these countries, and they have the potential to raise relations to a new level. These agreements give us the opportunity further to develop stronger ties and common approaches to global challenges. Further engagement with the Philippines, Vietnam, Mongolia and Iraq can help to make the most of the wealth of opportunities that lie in greater trade and investment links. It is also important to continue to strengthen our ties with these countries in response to emerging and constantly evolving security challenges while also remaining true to our core values.
As I mentioned previously, wide-ranging engagement with Iraq will enable us to assist the new Government, once formed, in addressing many of the political causes of the current instability and building, it is hoped, a more stable country in the future. The PCAs will all help to support our efforts to improve the human rights situation and to promote the principles of democracy and the rule of law in each of these countries.
I thank the noble Baroness for her support, and I commend the draft orders to the Committee.