The Secretary of State for International Trade (Elizabeth Truss)
I beg to move,
That this House has considered global Britain.
As the clock strikes 11 tomorrow night, we will start building the UK’s future as a sovereign trading nation. I should make clear that there are many aspects of global Britain that have nothing to do with trade. The Prime Minister will be leading an integrated defence, security and foreign policy review that will examine all aspects of our place in the world. The Foreign Secretary is spending today with his counterpart from our most important ally, the United States. The Government are committed to exceeding the 2% NATO defence spending target, and to spending 0.7% of GNP on development. Today, however, I will restrict my remarks to one aspect of the story, and that is trade.
Global Britain will be a beacon for free enterprise, free trade and free people across the world, and we will light that beacon championing the values for which the UK has long been known. From our abolition of the corn laws in 1846 to helping to found the General Agreement on Tariffs and Trade in 1948, the UK has long been a global leader in shaping the rules-based system, but from 1973 onwards that role has been increasingly curtailed. Tomorrow we will begin to reclaim that global leadership.
It is more than two centuries since our great political economist David Ricardo outlined the idea of comparative advantage, demonstrating how free and open trade benefits everyone, but it is an idea that still illuminates our country, and we have an opportunity to take that message out and across the world. Why is that important? First, it is the right thing to do. Believing in freedom is about more than economic theory. It is about believing in our freedom to set up a business, choose what we buy, and chart our own future. In its essence, free trade is about expanding that freedom across borders. It is the catalyst for sharing ideas, products, services and the innovations that improve all our lives. If we believe that people have the choice to access the best goods and services, we must also believe in free trade.
Secondly, that opportunity is important because Britain’s global leadership is sorely needed. Protectionist measures are on the rise across the world, increasing by three times the rate at the onset of the financial crisis. Brexit is the opportunity for this country to turn the tide, and to be a global champion of free, rules-based trade with the World Trade Organisation at its heart. That is not only morally right, but in the interests of our country. It is forecast that 90% of global growth will come from outside the EU. The world is bursting with opportunity—opportunity that Britain will seize with both hands.
Sir John Hayes (South Holland and The Deepings) (Con)
Leaving aside our contrasting views on Ricardo and the corn laws, I believe that my right hon. Friend and I share a distaste for the vapid, elitist supra- nationalism that the EU represents. Will she consider the possibility of a preferential trading arrangement with our Commonwealth allies, as suggested by the former President of Nigeria? That would build on the bond which already exists in Her Majesty’s realm and beyond.
Elizabeth Truss
My right hon. Friend has made a very good point. The Commonwealth makes up a third of the members of the WTO, and I am determined that we will work with Commonwealth partners not only to reduce tariffs, but to promote the rules-based international system that will benefit all those nations.
As I heard during a recent visit to Stoke-on-Trent, ceramics producers currently face a 28% tariff to export their fantastic crockery to the United States. We export nearly £8 billion worth of cars to the US every year, but, again, we face tariffs. British beef and lamb have been banned from entering the US for more than 20 years. More free trade with our partners, reducing those tariffs and barriers, will play an integral part in our agenda to level up the country.
Bob Seely (Isle of Wight) (Con)
May I follow up the point that my right hon. Friend has just made, very eloquently? CANZUK—consisting of Canada, Australia, New Zealand and ourselves—has the potential to play a considerable role. What are the Government’s plans to strengthen our CANZUK relationship in respect of trade and free movement, as well as other issues of mutual interest?
Elizabeth Truss
My hon. Friend is absolutely right. When we entered the EU, those close relationships with allies such as Canada, New Zealand and Australia fundamentally became less close. We have a huge opportunity, as we leave the EU, to build better relationships. We have already named Australia and New Zealand as two of our priority trading partners, and we want to work with Canada, particularly on accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, so that we can build up those strong relationships.
Stephen Farry (North Down) (Alliance)
Does the Secretary of State recognise that the UK does not, in fact, face a stark choice between maximising trade with either the European Union or the rest of the world? It is perfectly possible for the UK to maximise trade with the rest of the world through the European Union and through UK leadership in ensuring that the EU is open to the rest of the world. This false choice between the two could lead to the UK losing out on a range of opportunities.
Elizabeth Truss
I agree with the hon. Gentleman. We want to have a great trading relationship with the EU, and we want to have a great trading relationship with the rest of the world. Our ambition is to ensure that 80% of UK trade is covered by free trade deals within three years, and that will mean lower tariffs for British producers sending their goods into the EU and also right around the world.
This is hugely important for levelling up our country, from the potters of Staffordshire and the sheep farmers of Wales to the robotics manufacturers in the north-east. By lowering tariffs and striking advanced digital agreements, we will give a boost to local economies, which will increase the number of jobs, increase wages and promote growth in those areas. That is the way we are going to level up our country: through enterprise and trade bringing more opportunities.
We are ambitious about securing a pioneering free trade agreement with Japan, which is already our main source of investment in Asia, employing more than 150,000 people across the UK. There are also fantastic opportunities to expand our trade with Australia in areas as diverse as defence, education, digital and infrastructure. These opportunities with the US, Japan, Australia and New Zealand are significant and will bring real value, but there is also an opportunity for us to become part of world-leading trade arrangements such as the CPTPP, partnering with 11 of the fastest-growing Pacific economies with consumer markets worth over $6 trillion.
We have the opportunity to make great free trade agreements across the world, and global Britain can once again become the ideas factory of the world, building the networks, the trust and the confidence that will underpin the success of British businesses in markets of the future. That is why we recently held the Africa investment summit, breaking down barriers to trade, building business links and forging new relationships in a continent that includes more than half of the world’s 15 fastest-growing economies.
John Penrose (Weston-super-Mare) (Con)
It is good to hear such a doughty defence and exposition of some classical and enduring truths about the importance of free trade, not just to this country and everybody in it but to the rest of the world. Does my right hon. Friend agree that one small but symbolically significant thing we could do is to ensure that free trade is extended to our overseas territories? They are 14 fairly small territories scattered around the world, but each is potentially a trading post for Great Britain, and this could be of benefit to the residents of those territories as well.
Elizabeth Truss
My hon. Friend makes an extremely good point, and of course we want to extend those trading relationships with our overseas territories as far as we can.
I am pleased to say that, as we leave the European Union, we will be launching a new GREAT ready-to-trade campaign, featuring the Union flag and showcasing a modern, confident and successful Britain. We will have billboards and press and digital ads in 18 cities across 30 countries outside the EU, and we will be encouraging investors and buyers worldwide by showing that the UK is ready, willing and able to trade. These efforts are key to our agenda to unite to level up our country, delivering opportunity and unleashing the potential of every part of the United Kingdom.
However, trade is about more than just exports and investment. It is also about shaping the sort of world we want to live in. Let us be honest, there is a battle raging at the moment across the world: a battle between protectionism and free trade, between unfair trading practices and the defence of intellectual property, and between those who wish to restrict human freedom and those who seek to advance it. Let nobody be in any doubt which side the United Kingdom is on.
Mr Peter Bone (Wellingborough) (Con)
Does the Secretary of State agree that one of the opportunities we will have from tomorrow is to allow developing countries to have tariffs removed so that we will get cheaper products and their economies will expand? It is trade, not aid, that is going to solve the problem, and the EU has held us back on that.
Elizabeth Truss
My hon. Friend is right. Of course we are rolling over all the existing trade preference schemes with those nations, but as we leave the EU, we have opportunities to be more flexible. We have an opportunity to add new goods and to ensure that there is not a cliff edge for those developing nations, so that they do not see those trade preferences eroded when they get to a certain level of development. I completely agree with my hon. Friend that it is enterprise in this country that will help us to level up Britain, and it is enterprise across the world that will help us to level up world economies, taking more people out of poverty.
Working together with our friends and allies such as the EU, the United States and Japan, we will defend the frontiers of freedom, opportunity and prosperity for people right across the globe. We will engage at the G7 and the G20 and in the Commonwealth to move forward with WTO reform, update the rulebook and strengthen transparency. We are ambitious not just to defend freedom’s frontiers but to expand them. Just as we led the way in opening trade in goods during the past two centuries, as global Britain we will seek to do the same for services. The UK is the world’s second largest services exporter. The Office for National Statistics has estimated that two thirds of UK service exports are traded remotely, so we will be looking for advanced digital and data chapters to help businesses right across our country to succeed. Investment in the UK tech sector grew faster than any other country in the world last year, according to research by Tech Nation. We want to build on that potential, with future FTAs setting a global benchmark to take advantage of innovations in data, digital collaboration and the digitisation of trade.
We are determined to level up, to deliver opportunity and to unleash the potential of every part of the United Kingdom. We will promote the future of free trade in a world of rising protectionism. Tomorrow, we will demonstrate that Britain is back and we are ready to trade.
Bob Stewart
I am not going to argue with my hon. Friend about the semantics, because I agree with him. There is a level below the superpower of which we are most definitely a member.
I firmly believe that our participation in the United Nations really helps us to have influence in the world; and if we get it right, we get it very right. We were a founding member of the United Nations in 1945, which then—75 years ago—was an organisation that reflected the power politics of that time. Now there are 193 members and the United Nations is honestly the world Parliament, albeit a flawed one just as we are flawed here. It is the best we’ve got.
The most important United Nations organ is the Security Council, which consists of five permanent members. As everyone probably knows, they are the United States, Russia, China, France and ourselves. We were all allies in the second world war, and incidentally we are all nuclear-capable. Any one of the permanent members of the Security Council can veto a resolution to prevent its adoption, regardless of the fact that it may have majority support among the 15 members because the Security Council includes 10 non-permanent members, with five being elected each year to serve for a two-year period.
Critics quite rightly say, “Things have moved on. You’re looking at something that was relevant in 1945 and things have a hugely changed since then.” They are right. In a way, the United Nations is stuck in the past. The way it is set up is. Many people say—and my hon. Friend the Member for Isle of Wight (Bob Seely) just implied this—that states such as Japan, Germany, India and Brazil, and perhaps the European Union in the round, should be permanent members. Others say that France and the United Kingdom should not. Actually, they have a point—we must accept that—but may I just examine it and tease it out a bit? In terms of GDP contribution to the world, the United States is at 24%, China is at about 16%, Japan is at 5%, and then Germany and India at 4%. The UK and France are next, at 3%, followed by Italy, Brazil and Canada, at 2%. Interestingly, Russia is at less than 2%. Thus we hear the odd phrase that Russia’s economy is smaller than Italy’s—that is where it comes from. Using such measures, and assuming that the Security Council continues to have only five permanent members, they will be the United States, China, Japan, Germany and India. The UK and France would be out, and so too would Russia.
But in truth there is no real mechanism for change in the United Nations, and I do not think there is much appetite for it either. Trying to change that sort of organisation would be incredibly difficult. For instance, it would require the agreement of all five current permanent members—in other words, they would be volunteering for redundancy. I do not see that happening, and I am not sure whether the world would want it to happen. So, for the foreseeable future, the United Kingdom will remain a permanent member of the Security Council. That is really good news for us, as global Britain—great news. It provides us with a platform, and we do not have to pay too much for it because we use our reputation. Our reputation in the world is huge, regardless of fact that we have lesser and lesser defence forces. I have had direct contact with that myself, as I once rang the Security Council from the field, and when I said I was British, that got me through pretty quickly. We have a very good reputation in the Security Council, and the General Assembly as well.
Let me comment particularly on British involvement in UN peacekeeping, which, of course, the Security Council authorises. No United Nations operation can take place without being sanctioned by the Security Council, and we, as a permanent member, have a veto on that. I am glad to see my hon. Friend the Member for Wolverhampton South West back in his seat. I am sure he missed my slight dig at the Royal Green Jackets, so I want to get it in again now he is back—but he can read it later. For peacekeeping, there are three practical ways in which we contribute in the Security Council: first, by helping to provide the mandate, then by funding the forces, and then by contributing forces. Overall, the United Kingdom contributes nearly 7% of the UN’s budget for peacekeeping. That is more than we have to, but we still do pretty well because it is considerably more than our world GDP percentage.
I am glad to see that the Minister for Defence People and Veterans, my hon. Friend the Member for Plymouth, Moor View (Johnny Mercer), is now in his place, because I am about to give him a bit of a hand, as he is a good friend. It was a good idea for him to attend and perfect that he has just arrived. From hints put out by the Government over the last weeks, I gather that they intend to put more effort into UN peacemaking and the Department of Peacekeeping Operations. That is really good news—I am totally up for that. In fact, as part of our defence review, I am up for the idea of earmarking part of our armed forces to be sent to the United Nations when there is a requirement and we agree it. I like the idea of a battle group that is UN-designated.
I accept that the United Nations is not perfect, but it is well worth having, and honestly, it is all we have got. Every recognised state in the world—all 193 of them—is a member, and each has a seat in the General Assembly, as do we. Of course, the UK may not like some of the resolutions and debates in the General Assembly, but there is no doubt that it is the best forum—indeed, the only one—for gauging world opinion. Condemnation within the forum of the world is never welcomed by any country.
I have concentrated on one part of global Britain, but that is because I wanted to, because I believe that the United Nations is so important. The United Nations is a crucial part of keeping and improving our international influence. We are doing well now—we are not doing badly—but if we put more effort into it, we could get much more back. Our permanent seat on the Security Council is incredibly valuable, because that is where legally binding international mandates are designed, and through our own arguments, with our good Foreign Office officials and our good Ministers, such as the hon. Member for—where is it?
The Minister for Defence People and Veterans (Johnny Mercer)
Plymouth Moor View.
Bob Stewart
I have not been there yet, but I am coming. It is people like my hon. Friend who go and represent us at the Security Council. Let us give as much support as we can to the United Nations, and by doing that, I bet we will get much more back than we put in.
The Minister of State, Department for International Trade (Conor Burns)
It is a pleasure to reply to what has been a lively, entertaining and very well-informed debate. It is both an honour and a privilege to stand at this Dispatch Box today as the last Minister of the Crown to respond to a full debate while Britain is a member of the European Union.
Three and a half years ago, the British people took part in the largest binary democratic exercise in our nation’s history. In that referendum, they voted decisively that they wanted Britain’s relationship with the EU and with the rest of the world to change. As my hon. Friend the Member for Wycombe (Mr Baker) so brilliantly said, they wanted an open, outward-looking, internationalist, generous country to rejoin the international community. My approach, as someone who campaigned to leave and who believed, frankly, from the moment the Maastricht treaty was published in 1992 and citizenship of the European Union was established, was that Britain’s destiny lay outside that political institution. But I respect the fact that many of those whom I admire took a different view. I have always been guided, as I know has my hon. Friend, by the old saying that two reasonable people can perfectly reasonably reach opposite conclusions, based on the same set of facts, without each surrendering their right to be considered a reasonable person.
The people of Britain voted for a global Britain, and we are now in the process of realising that agenda. At 11 o’clock tomorrow night, or 12 o’clock for those in Gibraltar, we will leave the EU—I say this for the hon. Member for Glasgow South (Stewart Malcolm McDonald), who mentioned this in response to an intervention from his friend the hon. Member for North Down (Stephen Farry)—as one United Kingdom. This Government are determined to involve every nation and region of this great United Kingdom in that process, which is why only last week I chaired the first joint ministerial forum on trade.
Stewart Malcolm McDonald
Can the Minister tell me one concession he made that the Scottish Government asked for?
Conor Burns
I suggest that the hon. Gentleman talks to his counterpart in the Scottish Government.
My first visit as Minister of State at the Department for International Trade was to Scotland, the second was to Wales, and I was in Northern Ireland the following week, as a declaration of intent of our ambition to involve every nation of this country.
We will now be free to determine our own economic future, rekindling old friendships and reaching out to parts of the world that we may have ignored in recent decades. In our increasingly interconnected, globalised world, trade will play a central and vital role in supporting our shared security and prosperity. We face this future with confidence, built on firm foundations: we have the fifth-largest economy in the world; we are the second-largest service exporter; and we are home to the City of London, the world’s global financial gateway. Our commitment to law-governed liberty, our open liberal economy, our world-class talent and our business-friendly environment have made us a go-to destination for venture capital, and the European leader in attracting foreign direct investment, which last year, according to the Office for National Statistics, was a record level of £1.5 trillion.
We have an enormous amount to offer, whether it is our world-class education sector—a passion of mine since I made my maiden speech nine and a half years ago on the subject of student visitor visas—a system that has led to one in six global leaders having part of their education in the United Kingdom; our internationally renowned tech sector, now home to over 70 tech unicorns; or our green energy sector, which has seen us become a world leader in offshore wind and green finance. I congratulate my right hon. Friend the Member for Bournemouth East (Mr Ellwood) not only on being elected to chair the Defence Committee, but on highlighting the opportunity we have to play a massive international role in combating climate change.
Greg Smith
Will my right hon. Friend assure me that, among the fantastic list of areas in which we are prosperous and have something to offer the world, our creative industries will also be put centre stage?
Conor Burns
My hon. Friend is absolutely right. We lead the world in the creative industries. Only tomorrow I will travel to Pinewood Studios, and on Monday I will visit MediaCity in Manchester, where I will be outlining the contribution that the creative industries make to the United Kingdom’s economy. Given that my hon. Friend is a Bucks Member of Parliament, I think I am right in saying that the person who is hosting me tomorrow at Pinewood Studies chairs his local enterprise partnership.
However, there is a massive missed opportunity in the United Kingdom. It is a sad but true fact that less than 10% of British companies export anything at all overseas. That is why the Government’s export strategy will respond to that, to help increase exports as a percentage of GDP, complemented by a network of free ports, championed by my right hon. Friend the Secretary of State and my hon. Friend the Member for Ipswich (Tom Hunt), who I think is bidding for two of them.
Paul Bristow
The Minister talked about a lack of British firms exporting.
I wonder if he would give a shout-out to the communications industry. The communications industry in the UK is pioneering, and the Public Relations and Communications Association—the trade association for the communications industry—is now setting up and exporting British communications expertise across the country. I declare an interest in that my spouse is the owner of a communications company.
Conor Burns
My hon. Friend is absolutely right. I have no doubt that as well as being a vocal and articulate champion for Peterborough, he will promote the service sector in the UK economy, as he has just done so effectively.
I will endeavour to reply to the specific points raised in the debate. The shadow Minister criticised the Government for our interaction with Parliament in future agreements. We are going to publish an outline for each negotiation that includes objectives and scoping assessments, as well as an explanatory memorandum. The shadow Secretary of State constantly talks about us having an ineffective trade remedy system. The simple repetition of something does not make it true. We are going to have a tough regime, learning from international best practice.
I promised to come back to the shadow Secretary of State on the situation in Western Sahara. The UK-Morocco agreement will apply in the same way as the EU-Morocco agreement, having been amended to comply with the European Court of Justice judgment on the issue; that is a critical point. He also raised the question of bribery and corruption in the provision of UK Export Finance. UK Export Finance always carries out anti-bribery due diligence before providing any support at all.
I promise that I did not put him up to it, but my hon. Friend the Member for Arundel and South Downs (Andrew Griffith) said that we needed greater resource and more trade commissioners. He made that point very well indeed, and I hope it is heard. It would be inappropriate for me to endorse it, but—what is the old saying?—“He might very well think that; I couldn’t possibly comment.”
Mr Steve Baker
May I impress upon the Minister that with so many trade negotiations going on simultaneously, it is very important that he has another Minister of State in his Department?
Conor Burns
My hon. Friend will doubtless have been heard as well.
I pay tribute to those who made maiden speeches. The hon. Member for Aberdeen South (Stephen Flynn) gave an accomplished performance. I disagreed with almost every word of it, but he delivered it very effectively indeed. I thank him, from many of us on the Government Benches, for his kind words about his predecessor Ross Thomson.
My hon. Friend the Member for West Bromwich West (Shaun Bailey) spoke of his conversation with the noble Lady Boothroyd. We on the Treasury Bench understand the need to deliver, and having listened to him, I am certain that we will deliver for him and that he will not let Baroness Boothroyd down.
My hon. Friend the Member for Wolverhampton South West (Stuart Anderson) gave the most moving and deeply personal speech of the day. I salute him for his courage in speaking in that way in the Chamber. It was a genuine privilege to be on the Front Bench to hear his contribution.
The hon. Member for Streatham (Bell Ribeiro-Addy) gave an amusing and engaging speech, and spoke of her predecessor, Chuka Umunna. We all have things to learn from our predecessors. I learned much from Sir John Butterfill. I continue to learn much from the right hon. the Lord Eden of Winton, who first came to this House in 1954 and still provides me with excellent advice. The one piece of advice that the hon. Lady perhaps should not take from her predecessor is to join the Lib Dems—however tempting a prospect and however desperate they are. It would not be a career-enhancing move.
My hon. Friend the Member for Totnes (Anthony Mangnall) gave an absolute tour de force of a speech, in which he spoke a lot about fishing and ports, and then more about fish. I would say there is absolutely nothing fishy about my hon. Friend, which is not something that we could always say about his predecessor.
There are many who are worried about us leaving the European Union. They seem to think that we are going to cut all ties and walk away. The EU will remain our closest and largest market, and the Government are committed—as we committed with the EU in the political declaration—to signing a free trade agreement by the end of this year. But there are massive opportunities for the United Kingdom to exploit outside the European Union. According to the IMF, 90% of global GDP growth in the next five years will come from outside the EU. The trade deals we seek to negotiate, alongside those with the EU, represent a raft of exciting new trade agreements with other priority countries, our aim being to cover 80% of our trade with FTAs within three years. The United States, our largest single trading partner, is the obvious place to start—which is why we started there—but we also look to like-minded partners such as Australia, New Zealand and Japan. My right hon. Friend the Secretary of State has already made enormous strides in this regard, along with engaging positively on our potential accession to the CPTPP—heralded, again, by my hon. Friend the Member for Peterborough (Paul Bristow).
As I travel, I see enormous interest in what leaving the European Union means for other countries in their relationship with the United Kingdom. When I listened to the speech by the hon. Member for Brentford and Isleworth (Ruth Cadbury), I concluded that she must have been supping from the cup of pessimism. If what she was saying in the House today is what she is saying to people overseas, no wonder they think we are in a bad way. I find when I go to Chile, to Brazil, to Morocco, to Algeria—
Ruth Cadbury
The Minister talks about pessimism from overseas. When I visited businesses in Mumbai in 2018, they told me that it was incredibly difficult for them to do business in the UK because of the restrictive nature of getting business visas to come to the UK to meet their counterparts here. What conversations is he having with the Home Office to ensure that it is making it as easy for businesses overseas, in all these countries that the Government now want to trade with, to come here and do business as it is when they visit other countries—our competitor countries?
Conor Burns
The hon. Lady missed out only one thing in that wonderful intervention, and that was to conclude by welcoming the commitment to a points-based immigration system that will make it easier for people from around the world to come to the United Kingdom.
Conor Burns
No, I am not giving way again.
As my right hon. Friend the Prime Minister said at the UK-Africa investment summit, we want a system that is about people, not passports. I see enormous interest about what we can do—
Mr Deputy Speaker (Mr Nigel Evans)
That is not a point of order for the Chair; indeed, it was not even made to the Chair.
Conor Burns
I am grateful, Mr Deputy Speaker. Of course, the point that the hon. Lady made in her speech, and the point she is making now, is that people think that there are no opportunities in Brexit—that it is a disaster for Britain. But that visa situation happened while we were inside the European Union; it is an entirely unrelated point. We have the opportunity of changing that when we leave tomorrow and at the end of the year.
In response to the shadow Minister, who is again talking to the shadow Secretary of State, we have plenty of negotiators to help and support us—as many as the US trade rep has—and we have managed to negotiate over £110 billion of trade continuity agreements. She asked if I knew about what plans the Prime Minister has to change the structure of government or reshuffle his team. I have to say—knowing him well, as I do—that I do not. If I did, I might be more popular with my colleagues than I am.
Our country, and its nations and regions, have, over the centuries, given so much to the world. I remember the story of Winston Churchill in the early years of the last century, when, leaving this Chamber through those doors late at night, he turned and pointed in, and said, looking towards your Chair, Mr Deputy Speaker:
“This little room is the shrine of the world’s liberties.”
I was born in September 1972. Her Majesty gave Royal Assent to the European Communities Act in October 1972. I have lived but one month of my life in a country that had an independent trade policy. In one of Lady Thatcher’s favourite quotes:
“That which thy fathers have bequeathed to thee, earn it anew if thou wouldst possess it.”
That is our task: to herald our talent, to boost our trade, to grow our exports. Let future generations say, when they look back at us today, that we have brought jobs, prosperity and investment to every person in, and every corner of, our great nation. When they look back, let them say of us: they heralded the dawn of a new golden age and built a truly global Britain.
Question put and agreed to.
Resolved,
That this House has considered global Britain.