Lord Howell of Guildford
That this House takes note of the progress made in renewing the United Kingdom’s trading relationship with Commonwealth countries.
Lord Howell of Guildford (Con)
My Lords, I declare my interests, past and present, on Commonwealth matters as in the register: I am a former Minister for the Commonwealth and former president of the Royal Commonwealth Society.
I am very grateful for the opportunity to discuss Commonwealth developments with your Lordships. Now that we are told that the Commonwealth has moved to the centre of UK trade plans, it is clearly obvious that we should focus hard on these issues. I also welcome the noble Baroness, Lady Chapman, to the Opposition Front Bench, as I understand it is her first appearance in this role. It will not be a joy-ride of course, but she will certainly find it different from her very high-profile roles in the other place and her prominent position in her party. We wish her well.
It is impossible to comprehend the Commonwealth today, or its future direction and prospects, without understanding how it has evolved and is still evolving as a result of the worldwide communications revolution and its fundamental impact on all global networks, of which the Commonwealth happens to be the largest. Whether we are looking at public or private network systems or those that operate between the two spheres, the incredible potency of instant and continuous communication and exchange has changed the way that nations relate on all issues, the way that groups and interests relate and, indeed, the way that people relate.
The plain and obvious fact of existence now is that technology has enormously empowered network structures of all kinds as against traditional hierarchies of governance, with their inevitable centralising traits. The tendency of Commonwealth critics today—of whom there are a few, including not a few academics who dismiss the Commonwealth—springs from what these learned folk think they see through the lens of officialdom and government, as well as the lens of the past. To take a recent example, the modern Commonwealth was recently called
“an irrelevant institution afflicted by imperialist amnesia”,
by someone who, frankly, should have known much better.
However, in the age of networking and digital connectivity, the binding ties of a voluntary, non-treaty, global organisation such as the Commonwealth are sealed as much by enterprise and trade, civil society concerns and common everyday life and work interests as through government channels—indeed, even more so. This is of course what gives the Commonwealth today its vibrancy and brings it alive as never before. The Library briefing for this debate is a bit wrong in this respect when it says that three intergovernmental organisations are at the core of the Commonwealth association. It is not so; in fact, it is the nexus of non-governmental organisations, professions, business interests, education at all levels, science, law and hundreds of informal links, not to mention sports connections and the enormous and expanding range of arts and cultural links of every kind, that are increasingly at the core of the Commonwealth. They are all areas where, nowadays, soft power is at its most telling and effective.
Networks never sleep. The future pattern of international relations will be—and is already—far more through interest groups, professions, twinning of cities and dialogue between them, business conferences and initiatives, universities, research and discovery, shared technology and innovation, and a thousand other connections than through any formal governmental or official channels or agreements. It is precisely this quality which makes the Commonwealth, in Her Majesty the Queen’s own words,
“in many ways the face of the future”,
and why some more far-seeing commentators cite it as a model for international co-operation on issues large and small in the world we are moving into. This is a pattern of fluidity and resilience that no old-style hierarchies or alliances, burdened with their heavy furniture of top tables, pecking orders and costly central secretariats, can ever match.
The detailed, unfolding Commonwealth trade and investment prospect will, I am sure, be explained later in this debate by my noble friend Lord Marland, who chairs so ably the Commonwealth Enterprise and Investment Council and deals with some of the world’s largest and fastest-growing consumer markets, especially in Asia, which the Commonwealth now embraces.
I should say a word to your Lordships about the Brexit effect on Commonwealth economies, about which there were initially some fears. Most, if not all of these, were addressed fairly thoroughly in the EU–UK Trade and Cooperation Agreement and most countries that have partnership agreements with the EU have been covered by free trade agreements with the United Kingdom—or at least bridged by the generalised scheme of preferences.
Meanwhile, the immensely effective work of the noble Lord, Lord Grimstone—we call him our own—and the International Trade Secretary, Liz Truss, is opening up deals and opportunities with Australia, Canada, Singapore, Malaysia, South Africa, Ghana and a dozen other countries, and we hope, in due course, with the giant of all, India, although frankly that will not be easy. There is also the African Continental Free Trade Area, which will create the largest single free trade area in the world and is heavily Commonwealth-weighted. Then there is our application to join the rather clumsily named Comprehensive and Progressive Agreement for Trans-Pacific Partnership. Half its membership just happens to be from Commonwealth countries and it opens access to massive new markets for us, including the world’s biggest markets—as long as we meet the common rules and standard required, of course. We also have to remember that there is a leading Commonwealth figure—the wonderful Ngozi Okonjo-Iweala—at the helm of the World Trade Organization, so we are very well placed in this system.
The Zoom experience, which has mushroomed in the past year of the pandemic tragedy, has greatly increased the value of the key characteristics of the Commonwealth system and opened doors to multiple new initiatives. The new technology now swiftly gathers into one “room” hundreds of participants from across the planet where a mere handful could be assembled before. Of course, the cost of travel and accommodation in coming together are no longer the constraint that they were. This means that bodies such as the Commonwealth of Learning, based in Vancouver—already one of the largest distance-learning organisations in the world—can have continuous meetings and contacts with new levels of frequency. It means that, through bodies such as the Association of Commonwealth Universities, scholarly exchange, tutorship, and discussion on trade can be lifted from the cold text to friendly conversation in an instant. It means that business conferences and seminars can be organised on a global scale with new speed and ease. It means that intimate co-operation on areas far outside trade and culture—such as energy, properly tailored climate assistance, security, defence and intelligence—can be, and is being, built up like never before.
With the English language as the protocol of the planet, and with the soft power of influence and persuasion being the prime currency of international exchange, these new worldwide conditions fit the open hand of the Commonwealth system like the proverbial glove, frankly. I think it is the professors and the regular Commonwealth decriers, as well as some of our dismissive foreign policy and trade gurus, who are the real amnesia sufferers. They stare into the past and forget to study how the world has radically changed, how the Commonwealth has grown and changed totally since its 1949 inception, and how new forces of cohesion and co-operation are now at work within the world wide web that embraces us all.
I should add that, while we are rightly talking about trade, business growth, prosperity and poverty escape, we must remember that trade depends absolutely on peace and security. Here, too, the Commonwealth’s significance is growing, both in conventional forms through joint naval co-operation and in the new defence and security areas of cyber defence, intelligence, unmanned weaponry, aerial and marine, artificial intelligence and, of course, co-operation on terrorism prevention in all forms.
An effective and common front in containing China in Asia is going to depend on Commonwealth-dominated organisations such as Five Eyes, which need to be kept in tip-top condition, and on close defence co-operation at all levels with Commonwealth members. The new move to counter China’s belt and road initiative as it advances across the world is by the so-called Blue Dot Network initiative, combining public and private investment projects. That also depends heavily on commitment from Commonwealth countries and on Japan, a nation that has always taken a shrewd and close interest in the networking potential of Commonwealth—rather more than interest than has sometimes been shown right here in the UK.
World markets are changing fast, both geographically and in their nature, as services and technology transform trade flows. Distance matters less and less. All the modelling now suggests substantial scope for increased intra-Commonwealth trade. For one thing, we can obviously offer in this country a trade regime that is less heavy than the European Union pattern, although we need to keep close, good and sensible relations with the EU. Straightaway, we can be less protectionist where some industries and interests, which the EU strongly protects, are ones that we simply do not have and do not need to protect. Someone pointed out the other day that we do not need to check every lemon that comes into the United Kingdom because we do not grow lemons, as far as I know. That is just one small example of a different approach we can take.
My overall conclusion is the same as the one that the noble Lord, Lord Purvis, reached three years ago in the excellent inquiry by the All-Party Group on Trade Out of Poverty, which he chaired; I think we shall hear from him towards the end of this debate. We need a new mandate from Commonwealth leaders for trade and investment developments of all kinds, and that mandate is needed not to pave the way but to catch up with the amazing developments occurring at great speed. They open our own access to the expansion of vast new consumer markets where all the growth is going to be in the next 20 years, and address the needs of small and vulnerable states as well.
How good it would be to see this as a major legacy from the United Kingdom. We are just completing three years in office at the Commonwealth. It is all coming to an end. If we could bequeath this legacy and define it, how much this would also help to define our own national role and purpose at a time when old avenues have closed and a new era has begun. I beg to move.
Baroness Chapman of Darlington (Lab)
My Lords, it is a pleasure to take part in this debate. I am grateful to the noble Lord for his welcoming me to the Front Bench; it is most gracious of him and is appreciated. His passion for the Commonwealth can be felt on this side of the Chamber and is to be respected and applauded.
This debate is an excellent opportunity to consider the complex challenges and multiple opportunities that we now face as a country in forming our own independent trading policy in the post-Brexit era. We have the chance to apply our own priorities and strike our own trade deals with our Commonwealth cousins. We therefore have a responsibility to make sure that those priorities reflect our values. Closer trade allows us to strengthen our modern relationships with those nations to which we are tied by history, common traditions and the shared sacrifice of two world wars.
Of course, when we contemplate preferential trade deals with our Commonwealth cousins, the exact same questions arise that we must answer for every other potential trade partner around the world. Labour will never agree a trade deal that is not in the interests of British industries’ workers or our NHS, but we have to ask ourselves some important questions. For instance, are we willing to give trade deals to countries that attack the human rights of their people, allow the exploitation of their workers and deny their citizens essential democratic and personal freedoms? Are we willing to give trade deals to countries whose export trade actively relies on deforestation and other practices that make it harder for us to achieve our own global climate goals? Are we willing to give trade deals to countries that allow farming practices that are illegal in the UK and whose agricultural corporations will therefore be able to undercut our domestic producers? The Government have yet to make clear where they stand in response to all these important questions.
I would like to use this opportunity to address the most urgent issue facing our Commonwealth of nations, one in which the rules and systems of trade play a vital part: the global production and distribution of Covid vaccine. As of 30 June, eight of the 54 Commonwealth countries had vaccinated more than half of their population with at least one dose, but at the other end of that list, 26 Commonwealth countries have vaccination rates below 7%. Of those 26 countries, 15 have full trade agreements in place with the UK, so it is not tariff barriers that are stopping those countries vaccinating their people—it is a lack of healthcare systems, money and, most fundamental of all, vaccines.
As noble Lords will know, the Labour Party has set out a comprehensive plan to address the global shortage in vaccine supplies, which must start with an agreement on the sharing of vaccine patents. But we also need a global plan to build, equip and supply production facilities in key locations all over the world, and a bespoke international trade treaty to manage the supply of raw materials and medical equipment to ensure the safe, efficient and equitable distribution of vaccine and to prevent the practice of hoarding and vaccine nationalism. We need that as a matter of urgency, before more mass outbreaks occur in the poorest countries and before new variants emerge to threaten the effectiveness of the vaccine we have.
Baroness Scott of Bybrook (Con)
I remind the noble Baroness that the speaking limit is three minutes.
Baroness Chapman of Darlington (Lab)
I will soon conclude.
We all share the objectives of deeper trade with the Commonwealth, but none of those objectives can be achieved while the majority of our fellow Commonwealth countries remain in the grip of this pandemic and while half of them have barely begun their vaccine programme.
The Deputy Speaker (Lord Faulkner of Worcester) (Lab)
The noble Lord, Lord Wallace of Saltaire, has withdrawn from the debate, so I call the noble Viscount, Lord Waverley.
Viscount Waverley (CB)
My Lords, “Networks never sleep”—those are pragmatic words from the noble Lord, Lord Howell, and they are particularly applicable to the Commonwealth. However, for self-serving reasons, the UK nevertheless turned its back on the Commonwealth in favour of the EU experiment. The consequences of that were drilled into me this week by a Commonwealth trading partner, who said this: “The Commonwealth is not now the defining organisation for many countries, as many have opted in the meanwhile to strengthen linkages with geopolitical proximity”. However, intra-Commonwealth trade is a key aspiration, particularly east-west. Nevertheless, this is a cautionary tale, which, when combined with the pending quandary by way of a referendum in Barbados, indicates that we must not take the Commonwealth for granted and must never forget the tribute, gratitude and legacy of Her Majesty.
Trade agreements with Commonwealth members, including Singapore, India, Australia, New Zealand and Commonwealth CPTPP members, provide opportunities for us to strengthen Commonwealth trade and assist in meeting targets to double intra-Commonwealth trade to $2 trillion by 2030. However, some suggest that the Government’s current approach is fragmented across departments and unclear about how Commonwealth trade priorities fit into DIT’s priorities. There is no mention, for example, of the $2 trillion goal in DIT messaging, or that Commonwealth FTAs should be underpinning that target and so enabling us to achieve that goal.
Four fundamental goals are being presented to Ministers at CHOGM, via the B2B cluster of the business policy forum for the Commonwealth Connectivity Agenda, that could assist in this regard. Three are centred around digitalisation, given that the costs of trade transactions can be halved by reducing the reliance on paper-based systems and the need to redouble our efforts to digitise cross-border customs arrangements on trading goods. A focus on Covid eradication Commonwealth-wide is the fourth. Tackling Covid is the foundation stone to recovery for all; of course, the noble Baroness, Lady Chapman, was spot on in that regard.
With all this in mind, as co-chair of the APPG for Trade and Export Promotion, and recognising the importance that parliamentarians in Westminster and around the Commonwealth be kept abreast, I have requested International Economics Ltd of Mauritius, an advisory operation to Governments on trade agreements, to create a trade insight dashboard on the UK’s trading arrangements since Brexit. UK trade agreements with the Commonwealth—as with all FTAs globally, wherever they be—will be analysed pre and post Brexit, with insights on the trade flows and sector and product-level market access conditions for Commonwealth firms on the UK market and UK firms in Commonwealth markets. Additionally, there will be analysis on the number of agreements, trade flows and tariff preferences under each and every agreement that will offer interactive summary analytics, serving as a comparator with pre and post-Brexit trade with the European Union.
Lord Risby (Con)
My Lords, I warmly applaud my noble friend Lord Howell for initiating this debate and for so constantly bringing our attention to the Commonwealth over many years. I think it would not be unreasonable to say that much of the energy and focus of our Foreign and Commonwealth Office in the past perhaps arose out of our membership of the European Union. While we of course want to have excellent relationships with our European neighbours, the long-standing and prescient call by my noble friend to embrace the Commonwealth clearly needs to be answered now, without hesitation. I also applaud the work of my noble friend Lord Marland, who chairs the Commonwealth Enterprise and Investment Council, the mandate of which is to promote trade and investment across the Commonwealth.
We should capitalise on the Commonwealth advantage. It is a gateway to trading with nations with whom we share legislative practices based on the rule of law, with whom we overwhelmingly share common ideals and values through the commercial charter, and which is strengthened by commercial links and the Commonwealth legal framework.
Each morning, I look at newspapers from across the channel. There is considerable debate, not always harmonious, about links between Francophone countries. Quite simply, our Commonwealth structure has no remote equal and is widely admired.
In the extensive list of countries with whom we have signed trade deals, digital connectivity and stimulating digital trade is at the heart of a number of these agreements. Thus, the Commonwealth is an area for this country to develop and share targeted digital commercial activity.
Young people abroad remain very attracted by our technological and cultural offer and our forms of soft power, often through the English language. I greatly welcome the changed visa regime, with students from the Commonwealth now able to study and work here much more freely.
There is one structural component of the Commonwealth architecture which begs for modernisation. I happen to be the Prime Minister’s trade envoy to Algeria—the biggest country in Africa and, for over 50 years, a reliable supplier to us of liquified natural gas. As I have heard from their president’s lips, they would like to have associate or formal observer status with the Commonwealth. But there is no such status: it is either full membership or nothing. Does my noble friend agree with more flexible linkages to the organisation, which would undoubtedly enhance the Commonwealth’s reach and credibility? If he does, will he strongly take the message to our Government to work assiduously to achieve this? After all, our Prime Minister is currently chair-in-office. Surely the time to put real focus and energy into the Commonwealth has now arisen.
The Lord Bishop of St Albans [V]
My Lords, I welcome Her Majesty’s Government’s intent to strengthen ties with the Commonwealth as we transition to our new reality outside the European Union. When we entered the European Common Market, we severed many tight economic ties with some of our Commonwealth partners. It is because of that that I am particularly pleased at the announcement of the economic partnership agreement with CARIFORUM, which covers many countries with whom we continue to share a head of state.
My diocese is linked with the Windward Islands, and we are glad to have a large community of Vincentians living in Luton. They have told me of the extraordinary economic disruption that occurred to them when we joined the EEC. Although many of these Commonwealth realm territories contained within the CARIFORUM agreement are small in GDP terms, there is a symbolic importance to this agreement, and I hope it will be a platform to further invest and engage culturally with these territories to strengthen our existing ties.
While any future agreements with Commonwealth countries have the potential to create prosperity, it is vital that this prosperity is truly mutual, delivers material improvements to the ordinary citizens of those countries and does not constitute the sort of extractive relations of the past. However, as we know, the Commonwealth is primarily an organisation that affirms our commitment to shared values—democracy, human rights and freedom of religion, to name a few—and it is important that future economic agreements promote these values. We cannot presume that free trade and market liberalisation alone will naturally deliver liberal and tolerant societies, and I hope that our continued engagement with the Commonwealth does not devolve into a quid pro quo economic relationship stemming from our need to sign trade agreements. We should not shy away from the fact that some Commonwealth members do not have the sort of record on our shared values that one might expect or hope. As part of the Government’s vision of global Britain, I hope that we will explore seriously the ways we can embed positive social consequences into trade deals and truly be that force for good in the world that the Foreign Secretary has spoken of so powerfully in the past.
Lord Triesman (Lab) [V]
My Lords, I too declare my interest as a former Commonwealth Minister, and I thank the noble Lord, Lord Howell, for initiating this debate. It is also a pleasure to follow the right reverend Prelate the Bishop of St Albans.
I start by wishing all of us well, here and in the Commonwealth, in our trade relationships. I do not think you could create the Commonwealth today; it is a unique organisation, and it has deepened its relationships with all its members in so many ways. I also want to say that the noble Lord, Lord Grimstone, is a very fine ambassador for trade.
But our optimism about it needs to be tempered by some realism, particularly as we want to see global developments in trade. The noble Viscount, Lord Waverley, used the term “geopolitical proximity”, and that is always a genuine issue. I just want to make the point that distances cannot be dismissed lightly. According to the Library briefing, the average distance by air from London of our top 10 trading nations in the Commonwealth is 9,601 kilometres. The average for the top 10 of our former EU partners is 1,020 kilometres—and that is by road, which means that the delivery of goods is significant. We are looking at 9.4 times the distances we have traditionally looked at. That is significant because our trade is largely in goods, not so much in services. We use shipping. We have seen that even one ship in the Suez Canal can create considerable difficulties. Most shipping is using bunker fuel and emitting huge amounts of sulphur into the atmosphere. These are all important factors we need to overcome.
The interconnectivity the noble Lord, Lord Howell, refers to is of course absolutely real, but it is universal. The interconnectivity is not just with the Commonwealth but with all other countries, none of which sleep in the world of this interconnectivity. But even interconnectivity is not unproblematic. It is a huge source of business, of course, but we know now that it is an even greater source of fraud—not insurmountable, but a real factor.
I just want to finish on the Covid point, which has been made so well by my noble friend Lady Chapman. It is a really serious matter. Forty-four million people in the Commonwealth have been infected—130,000 more each day. There have been 700,000 deaths, growing by 1% per day. Vaccines so far have got to about 1% of the population of Africa, and that really does mean that the people are suffering in all the ways we know about medically but also in their ability to construct and reconstruct and build their economies. If we have a serious approach to this, we will deal with it.
Finally, but not as an afterthought, I applaud what the noble Lord, Lord Risby, just said. When I was Minister for the Commonwealth, I also thought associate membership would be very important and that Algeria would be a prime candidate.
Lord Hussain (LD)
My Lords, I am one of those most enthusiastic supporters of improving our trade links with countries of the British Commonwealth, particularly in the post-Brexit era. However, the compass of our trade initiatives should be set to advance the public’s benefit and to ensure that our trading partners respect the rights of all people and honour all commitments made with Britain and the international community. The Declaration of Commonwealth Principles agreed in Singapore in 1971 supports
“the liberty of the individual … equal rights for all citizens … and … their inalienable right to participate by means of free and democratic political processes.”
The declaration endorses fostering “human dignity and equality” and “the principles of self-determination.”
India being the largest country in the Commonwealth, it makes sense to make our trade relations stronger with it. But when I match these values and principles with the conditions and treatment of Christians, Dalits, Muslims and Sikhs in India, I feel as though Britain is simply turning a blind eye to some of these terrible records of human rights abuses. The situation in Indian-administered Jammu and Kashmir is even more appalling, where, according to many international human rights organisations, including the UN Commission on Human Rights, the Indian army is involved in illegal detentions, torture, rape, fake encounters and extrajudicial killing. The UN has repeatedly asked for free access to investigate these reports of human rights abuses, but India continues to ignore them.
The Indian actions in Kashmir are clearly against the Commonwealth values and principles, the UN charter and the Geneva convention. In light of this, on behalf of over 1 million British Kashmiris, I ask the Minister: will our trade with India be linked with human rights? If India continues to violate the Commonwealth values and principles, what action will the British Government be prepared to take? Furthermore, what actions are the British Government taking to get India to give the United Nations the access it requires and to co-operate with the investigation of human rights abuses in Kashmir?
Baroness Hooper (Con)
My Lords, I join all those who have thanked and congratulated my noble friend Lord Howell for giving us the opportunity to debate this important topic. Since the first hint of Brexit, my noble friend has been consistent in advocating the opportunities and advantages we have in building on our special relationship with our Commonwealth cousins. I agree with everything he said, especially on the importance of educational links. It is certainly hardly surprising that the first non-rollover FTA we have entered into has been completed with Australia.
As many of your Lordships will know, I have a long-standing interest and involvement in Latin America as a region, and now my voluntary duties as a trade envoy also lie there. But Guyana in South America and Belize in central America are both Commonwealth members, and I hope and trust they will not be overlooked in any new trade deal. I should perhaps say, in this context, that my honourable friend Darren Henry, who is the trade envoy to the English-speaking Caribbean, also includes Guyana in his sphere of influence and is certainly working on this. We have already heard from my noble friend Lord Risby, and his observations from his long experience as a trade envoy were very interesting.
In my few minutes, I will raise a few issues and to ask the Minister for some points of clarification. The role of the British group of the CPA, the Commonwealth Parliamentary Association, cannot be overestimated, especially in terms of the important work it does. As a former member of the executive council, I am well aware of the work it does in relation to the values and principles set out in the Commonwealth charter. As the excellent Library briefing puts it:
“These range from respect for democracy, human rights and the rule of law, through to promoting good governance, pursuing sustainable development and acknowledging the role civil society can play in communities”—
all very important values to be acknowledged in future trade deals.
On a second point, if we intend to move the centre of our trade efforts to the Commonwealth, what will be the role of the Commonwealth Secretariat based here in London? Will it be part of any consultation process? Will it or could it have a monitoring or regulatory role? Can my noble friend the Minister enlighten us on that?
Finally, perhaps I may be reassured that the overseas territories will not be forgotten and will be included as much as possible in any trade deals and dialogue on trade opportunities. I look forward to the rest of the debate.
Baroness Prashar (CB) [V]
My Lords, I thank the noble Lord, Lord Howell, for introducing this debate. I agree with him about the relevance of the modern Commonwealth, its potential and the importance of its non-governmental networks.
The benefits of trading with and within the Commonwealth are well documented, but this so-called Commonwealth advantage can be further harnessed by new technologies, especially digitisation. In recent years we have seen an increase in deliverable digital exports in services in upper and middle-income Commonwealth countries, but they have decreased in small and low-income Commonwealth states. The digital divide, digital penetration and skills in information management are real issues that need to be addressed in the Commonwealth if we are to realise the ambition of reaching the $2 trillion target by 2030, as agreed at CHOGM in 2018. Can the Minister tell the House what action the UK is taking to address this digital divide? Furthermore, what specific steps have been taken by the UK to improve the regulatory environment and supply chains?
In October 2019, the International Trade Secretary, Liz Truss, when addressing the meeting of Commonwealth Trade Ministers said that the Commonwealth was one of the UK’s largest trading partners, worth over £100 billion in March 2019. Although the value of UK exports to the Commonwealth increased by 4% between 2018 and 2019, and the value of imports grew by 15%, the UK’s trade is with a very small number of Commonwealth countries, including Australia, Canada and New Zealand. The integrated review talked about seeking bespoke trade agreements with those countries, as well as India, and the UK has signed continuity agreements with South Africa, Mozambique and others mentioned by the noble Lord, Lord Howell. That progress is commendable, but does the Minister agree that the UK has a responsibility to the whole of the Commonwealth, particularly low-income states, and needs to ensure that disparities in areas such as digital penetration within the Commonwealth are mitigated? Again, in 2019, the International Trade Secretary stated that,
“the 53 member states of the Commonwealth have the unique ability to be able to lead the defence of free trade…showing the world a route to prosperity”.
Should we, therefore, not be working with the Commonwealth as a whole?
Baroness Liddell of Coatdyke (Lab) [V]
I too congratulate the noble Lord, Lord Howell, on securing this debate. We do not talk about the Commonwealth enough. It is often an afterthought and now that we are looking for trading partners, it is up there in our priorities.
The noble Lord mentioned leading Commonwealth figures, but did not mention one of our own number, the Secretary-General of the Commonwealth, my noble and learned friend Lady Scotland of Asthal. I refer to the point made by the noble Baroness, Lady Hooper, who said that there is a real opportunity there for us as a Parliament as well as a Government to enter into much more of a dialogue on what is happening to the entire Commonwealth. We need much more to take into account the entire Commonwealth, where we often have a trade surplus.
In 2019, 69% of our trade with the Commonwealth was with India, Canada, Australia, Singapore and South Africa. The remaining 44 countries accounted for the remaining 31%. My noble friend Lady Chapman, in her excellent introduction to the debate from the Opposition Benches, talked about ways we could help some countries in the Commonwealth reform. That is something that various trade deals could bring about. Will the Minister tell the House where the Government stand on strengthening the unilateral preferences that they grant to developing Commonwealth countries for their mutual benefit? How do the cuts in overseas aid fit in with that?
The Government have said that they provide for duty-free, quota-free access for the least-developed countries and have put in place a preferential scheme for them. The Prime Minister himself has been clear about the relationship between development and trade. Is that not an area in which we can use the opportunities of trade to bring greater benefit and reform in some Commonwealth countries?
We have, too, to be genuine in looking at the opportunities in the developed countries. There is a great deal of talk in Australia about how well that country has done out of the negotiations with the United Kingdom, but we must take into account the problems that some of our farmers face. Therefore, we cannot be romantic about the nature of deals with the Commonwealth, which we have to look at in some detail. There is a concentration among the highly developed countries of the Commonwealth such as Canada, Australia and New Zealand that could seriously disadvantage the less-developed countries. If we want the Commonwealth to thrive, we have to think of the less-developed countries as well.
The Deputy Speaker (Lord Faulkner of Worcester) (Lab)
The noble Earl, Lord Shrewsbury, and the noble Lords, Lord St John of Bletso and Lord Hain, have all withdrawn, so I call the noble Lord, Lord Lansley.
Lord Lansley (Con)
My Lords, I join in thanking my noble friend Lord Howell for enabling this debate. It is most welcome. I am also pleased to follow the noble Baroness, Lady Liddell of Coatdyke. She and I serve together on the International Agreements Committee. In that context, we have had the privilege of examining the continuity trade agreements—the rollover agreements—that have enabled us to transition agreements that we had previously with the European Union.
In my tally of the 53 other Commonwealth states, two are member states of the European Union, and with 28 of them we have now in place transition rollover agreements—or, as my noble friend said, sufficient bridging agreements. Many of them are literally rollover agreements with no continuity-plus provisions. I should say first that it is important that we make rapid progress with, for example, Canada, Ghana, Kenya and others in turning those continuity agreements into continuity-plus agreements. In addition, 17 countries are within the generalised scheme of preferences in its various frame- works, which leaves, for those who are calculating, six other countries, with three of which we have negotiations in train—New Zealand, Australia and Singapore. We will have trade relationships with two of those countries—Brunei and Malaysia—by virtue of our accession to CPTPP. The other country is, I think, the Maldives. Therefore, by my calculation, we will have trade relationships with Commonwealth countries, but the point is that we need to make those relationships stronger and fuller.
I wish to make three quick points. First, let us try to make sure that we include the environment in this. New Zealand has taken an initiative on climate change, trade and sustainability to have tariff-free environmental goods, to remove subsidies on fossil fuels and to promote eco-labelling. We could use the Commonwealth, which would be a great place to bring that initiative forward on a more global basis.
Secondly, many of our agreements focus on goods, but we have the capacity, as my noble friend Lord Risby said, to be strong in digital trade and, indeed, to be a services-sector superpower. We should extend many of those agreements into services on a major push to develop those relationships.
Thirdly and finally, I look forward to hearing from my noble friend Lord Marland. The Commonwealth should and can be a powerful instrument through which we promote enterprise and entrepreneurships and scale up businesses, particularly in developing countries. As a consequence, we will expand our trade to those countries dramatically, as well as their exports to us.
Lord Bilimoria (CB) [V]
My Lords, the Commonwealth of 54 countries is a voluntary organisation of 2.4 billion people and GDP estimated at $3 trillion. The Commonwealth Heads of Government Meeting has said that it wants to increase trade between the Commonwealth countries to $2 trillion by 2030. This was at the CHOGM held in London in 2018. We, as the UK Government, are pursuing free trade agreements with Commonwealth partners. I thank the noble Lord, Lord Howell, who is a true and constant champion of the Commonwealth. It makes up a third of the world’s population, 60% of Commonwealth citizens are under the age of 30 and it has recently celebrated its 70th anniversary.
As president of the CBI, I had the privilege of chairing the B7, which fed into the G7. One of our speakers was the impressive Dr Ngozi Okonjo-Iweala, who was referred to by the noble Lord, Lord Howell, is the new head of the WTO and was head of Gavi, the Vaccine Alliance, before that—what serendipity. She highlighted that 17% of the world’s population is in Africa yet Africa has only 0.15% of the world’s vaccine-manufacturing capability. India, a country with a population equivalent to the whole African continent— 1.4 billion people—has the largest vaccine manufacturer in the world, the Serum Institute of India, owned by my friend Cyrus Poonawalla. Two-thirds of children vaccinated have been vaccinated by the Serum Institute of India, and it has just announced it is increasing its AstraZeneca/Oxford vaccine production from 100 million to 200 million doses a month.
Digital connectivity and enabling member nations to benefit from it was spoken about at CHOGM. At the B7, we thanked God for digitisation in this pandemic, yet the more digitisation we have the more vulnerable we are, so cybersecurity is something the Commonwealth has to work on.
A stark fact is this: trade with all 54 Commonwealth countries amounts to less than 10% of the UK’s trade. Five countries—Australia, Canada, India, Singapore and South Africa—accounted for almost three-quarters of this, yet the EU is 45% of our trade and the United States is 15%. We have heard about Liz Truss and her Department for International Trade and the fantastic job they have done rolling over 67 trade agreements with the EU. We are now making them bespoke. Canada is an example of one we have started to enhance.
George Brandis, the Australian high commissioner, recently spoke of the brand new Australian deal, which took just 365 days. That will be a stepping-stone for us, as Australia will be an ambassador for us entering the CPTPP, worth £110 billion to us. On top of that, we have New Zealand coming on and have announced an enhanced trade partnership with India, working towards a free trade agreement and an ambition to double our trade of £24 billion by 2030. The potential is enormous and we must make much more of the potential of the Commonwealth.
The Deputy Speaker (Lord Faulkner of Worcester) (Lab)
The noble Lord, Lord Sheikh, has withdrawn, so I call the noble Lord, Lord Anderson of Swansea.
Lord Anderson of Swansea (Lab) [V]
My Lords, I welcome my noble friend to the Front Bench and join others in congratulating the noble Lord, Lord Howell, on initiating this debate. He has a distinguished role in being an enthusiast for the Commonwealth over many years. I, as a former chairman of the Commonwealth Parliamentary Association, share his enthusiasm but am more sceptical about the prospects for a substantial increase in our trade with the Commonwealth.
I note that the Motion refers to “renewing”; surely we should guard against nostalgia with reality. Over the past 50 years, for example, our own UK trade patterns have altered substantially; similarly, the Commonwealth has changed and moved away from the UK. There are costs in any such agreement—such as those to Welsh lamb producers, and no doubt India will demand an increase in visas. The world has changed around us too, with the rise of China and concessionary finance to west African Commonwealth countries and others, which we probably cannot match. I note that New Zealand has blocked broadening Five Eyes to a more political role because of its reliance on China’s markets for its exports.
With all the problems and a relatively small scale, of course we should make progress with our Commonwealth partners where we can. I recognise the wonderful breadth of the Commonwealth connection mentioned by the noble Lord, Lord Howell. I look forward to learning from the noble Lord, Lord Marland, and the Minister about whether we will move from rhetoric to devoting more resources and personnel to promote our trade with the Commonwealth family. We will be ready to give technical assistance on trade matters to less-developed Commonwealth countries.
Viscount Trenchard (Con)
My Lords, it is a great pleasure to speak in this timely debate. I congratulate my noble friend Lord Howell, both on securing the debate today and on his inspirational and interesting speech. He has long been the strongest advocate of the Commonwealth and the huge potential benefits it can offer all its members. Our 47-year dalliance with the EU has meant we have not pursued the valuable opportunities open to this unique association of 54 member states to make a great contribution to free trade, security and stability across the world.
It is good news that we have reached agreement in principle on a free trade deal with Australia. The lord mayor’s virtual visit to New Zealand in May showed great enthusiasm in that country for the progress being made towards a free trade agreement, with ambitious digital provisions.
India is another major Commonwealth country with which we are now moving to make up for lost time. The lord mayor’s virtual visit there in November 2020 provided a further boost to London’s fintech industry, which is now worth £6.6 billion to the UK economy and accounts for 76,000 jobs. UK-India collaboration is an important factor at the heart of the growth and continued success of the sector. Stephen Booth, head of the Britain in the World project at Policy Exchange, has also written about the positive results from the Prime Minister’s recent summit with Narendra Modi. Mr Modi coined the term “living bridge” to describe the deep connections between the two countries, in part deriving from the 1.6 million UK nationals of Indian descent.
The most exciting development in our new independent trade strategy is our application for accession to the CPTPP. It is notable that among the 11 member countries of partnership are six Commonwealth countries. Our application to the CPTPP provides hard evidence that we are serious about our tilt to the Indo-Pacific, as an important part of global Britain. I hope that other Commonwealth countries which share our commitment to free trade and the prosperity it generates may follow our example in joining the organisation. They may also consider that, against the background of the rise of China, membership offers geostrategic and security advantages.
The noble Lord, Lord Triesman, suggested that geographic distance acts as a barrier to trade in goods. I remind him that Ottawa is 16,000 kilometres from Canberra; both are members of the CPTPP. As my noble friend Lord Lansley said, our new trade agreements have strong digital provisions and global Britain is as much about services as goods, leveraging London’s position as clear global leader, in spite of a failed attempt to sabotage international equities markets. Does the Minister agree that the sooner the UK completes—
Baroness Scott of Bybrook (Con)
Can I remind my noble friend of his 3 minutes?
Viscount Trenchard (Con)
Yes, I will just finish.
—completes our accession negotiations, the better, both because Japan is providing strong support during its presidency, which lasts until the end of the year, and because the UK’s role in developing the modus operandi of the organisation will be maximised by our early involvement?
Ironically, particularly prior to the possible future return to the organisation of the US—
Baroness Scott of Bybrook (Con)
I am sorry, but I ask the noble Viscount to finish now, please.
Viscount Trenchard (Con)
Can the Minister tell the House when he expects the accession negotiations to be completed?
Lord Wigley (PC) [V]
My Lords, I thank the noble Lord, Lord Howell, for facilitating this debate and declare my interest as a member of the Farmers Union of Wales. It is from the viewpoint of Welsh farmers, and in particular hill farmers, that I address the House on the Australian trade deal and its implications for the future of Commonwealth deals.
From our Brexit debates, noble Lords will be aware of the deep anxiety in our sheep sector, as 90% of our sheepmeat exports go to the EU. A no-deal Brexit would have imposed punitive tariffs on sheepmeat sold to Europe. Mercifully, the Brexit deal avoids that possibility for as long as it holds firm.
The vulnerability of our sheep sector comes to the fore in the context of the Australian trade deal. There is trepidation in the sector that the Australian beef and lamb entering the British market will make our products uncompetitive. Australian sheepmeat prices are 30% lower than UK prices. Australia’s largest beef exporter says that zero tariffs would increase Australian exports to Britain tenfold. In 2017 Australia exported to Britain some 20,000 tonnes of lamb, which under this deal will increase to 75,000 tonnes over 10 years, with similar increases in beef quotas.
The fear is that Australia will undercut Welsh farmers, for three reasons. The first is its huge economy of scale: its farms are 80 times larger than the family farms of Wales. The second is cut-price animal welfare, with live animals transported without food or water for 48 hours and sheep rear ends having flesh and skin cut off without anaesthetic. Thirdly, growth hormone treatment is permitted in Australian beef.
The Tory manifesto stated that the UK
“will not compromise on our high environmental protection, animal welfare and food standards”,
but that is happening with the Australian trade deal. It is at odds with the Government’s professed green policies to ship animal carcasses half way around the world, with huge carbon footprints, when that meat can be grown here to higher standards.
On the basis of this deal, British exports to Australia will increase by 7% and Australian exports to Britain by 80%. That is a sell-out. Following Australia, New Zealand’s Meat Industry Association is now seeking an even better export deal to the UK. My fear is that this will set a pattern for other Commonwealth agreements.
Welsh farmers who voted Conservative 18 months ago are learning a bitter lesson. I am a great fan of the Commonwealth and hope only that the Australian trade deal experience is not seen as a negative reflection on future Commonwealth trade opportunities.
Lord Balfe (Con)
My Lords, I thank my noble friend Lord Howell for initiating this debate and welcome the noble Baroness, Lady Chapman, to her new role. She will probably find this place a bit more peaceful than where she came from, but I hope she enjoys it.
My connection with the Commonwealth goes back to the beginning of my working life, across the road with the Crown Agents for Oversea Governments and Administrations, a body sponsored by the British Government. During the time I was working for it, its main aim was to enable the colonies to emerge into the Commonwealth. It did a pretty good job. We are dealing with probably the largest international voluntary organisation in the world. As with many voluntary organisations, it is a very disparate group of nations—some would say too disparate.
We just heard from the noble Lord, Lord Wigley, who made many points about why the Australian deal is not a good one. I tend to think it probably is quite a good one, because at heart I am a free trader. If you reduce tariffs, you generally improve people’s welfare. The argument about free trade has been a feature of British politics for at least 100 years.
I counsel us against romanticising about the Commonwealth. There is a tendency—particularly among those who were not, let us say, 100% in favour of the EU—to try to look back to a time that was quite different, when there was a Commonwealth but Australia and New Zealand basically fed Britain. That time has long gone and will not come back. The sheep miles referred to by the noble Lord, Lord Wigley, are exactly what will stop it, because the market for Australian and New Zealand produce is now in the Far East and the Middle East. It is not in the United Kingdom and it is not going to be.
I see the future of the Commonwealth as a centre of soft power, an organisation that can give good advice, set standards, encourage good behaviour and, on occasions, assist other countries with limited amounts of money. It is not going to be a substitute for our aid budget or the international financial institutions we all subscribe to. Where it does have a future is as a centre of soft power, working with the British Council, the BBC and those other institutions that do so much to promote a good image of Britain and the Commonwealth in the world.
Baroness Donaghy (Lab)
I congratulate the noble Lord, Lord Howell, on initiating this debate. I know his commitment to the Commonwealth is genuine and of long standing. He would not use this debate as a shop window to boost Brexit’s so-called successes. I am not so sure about the current Government’s sincerity.
In the 1990s I attended a couple of CHOGMs in Zimbabwe and South Africa as a member of the Commonwealth TUC. Lord Hurd, who was the Foreign Office Minister, was fully in charge of his excellent briefings when he met the Commonwealth TUC, knowing which trade union leader in Africa was likely to be the next leader of his country. The noble Lord, Lord Howell, is similarly well briefed. It would be good if he were to brief the current generation of Ministers on, for instance, the difference between Zimbabwe and Zambia. A junior Minister with the unfortunate name of Duddridge attended former President Kaunda’s funeral and appeared to be confused as to which country he was in, all in front of President Kenyatta of Kenya, President Ramaphosa of South Africa and President Lungu of Zambia.
Of course, these countries and the rest of the Commonwealth will have a healthy scepticism of the UK because of the way some of them were treated when we entered the then Common Market and the way we agreed a Brexit treaty and Northern Ireland protocol that contained inherent contradictions, then made the announcement in Parliament that the Government intended to break that treaty.
To rebuild that damaged reputation, we need future trade agreements to be comprehensive, transparent and to have the maximum involvement of Parliament. The deals should be linked to climate change and human rights and ensure that standards are maintained, particularly for agriculture, to protect our farming industries. How will we ensure standards when we do not have enough vets or inspectors? How will we uphold standards if our own farmers are undercut by cheap imports? How will the general public know the content of the food they are eating, so that they have a real choice?
Baroness Bennett of Manor Castle (GP) [V]
My Lords, it is a great pleasure to follow the noble Baroness, Lady Donaghy, to welcome the noble Baroness, Lady Chapman, and to associate myself with the comments of the noble Lord, Lord Wigley, particularly on the question of animal welfare. The operation to which he referred is called mulesing and it is barbaric. I thank the noble Lord, Lord Howell, for securing this debate and commend the call by the noble Lord, Lord Lansley, for the UK to get behind the New Zealand Agreement on Climate Change, Trade and Sustainability.
In my three minutes, I have three points to make. First, in 2018 CHOGM, in the Declaration on the Commonwealth Connectivity Agenda for Trade and Investment, agreed to make trade more
“inclusive by encouraging the participation of women and youth in business activities, by taking a gender responsive approach to the development of trade policy, increasing opportunities for women to trade internationally, and breaking down gender barriers”.
What measures are the Government taking to promote that agenda? In the same year, the Commonwealth announced a memorandum of understanding with the United Nations Office for South-South Cooperation. What is the UK doing to promote that?
My second issue is also about approaching trade through a fair-trade lens rather than a free-trade one, building on the concerns expressed by the right reverend Prelate the Bishop of Saint Albans. Given the global problem of the low levels of corporation tax being paid, we have heard in the last couple of days the US Treasury Secretary Janet Yellen saying that the US will be pushing to raise the 15% floor agreed as a minimum corporation tax rate by 130 countries last week. One member of the Commonwealth that stands out here particularly is Mauritius, a middle-income country and in many ways a success story but also a tax haven that has allowed global companies to siphon millions of tax dollars away from low-income African nations, including other Commonwealth members. Are the Government going to seek to encourage the Commonwealth to be a positive actor for tax justice, stopping the parasitism of multinational companies that afflicts the whole world but particularly the world’s poorest nations?
Thirdly, on plastics, I draw the minister’s attention to an excellent international trade working paper entitled Plastic Production and Trade in Small States and SIDS: The Shift Towards a Circular Economy. It is a Commonwealth international trade working paper that talks about how plastics, mostly produced and consumed in the global north, are having huge negative impacts on ocean-based sectors and on small nations, including many Commonwealth members, in areas such as tourism and fisheries. The report says that there need to be coherent trade policies to ensure that those countries can protect themselves and be part of the solution rather than simply suffering from the problem. What are the Government doing to promote that agenda?
Lord Rooker (Lab) [V]
My Lords, I am very happy to make a small contribution to this debate. There has not been enough concentration on the fact that we have to follow the WTO rules. I do not know the details of the vast experience of the noble Lord, Lord Balfe, which is different from mine, but I have to say that when I came up against the Crown Agents in the 1970s, I got the impression that they were basically there to facilitate British sales to Commonwealth countries; it was a form of exploitation, in a way.
My main point is that we do not have the resources to police a substantial increase in trade with the 54 countries of the Commonwealth. Let us take just three examples, all of which are very highly regulated: imports to the UK of children’s toys, electrical goods and food, particularly of animal origin. When we were a member of the EU, it employed hundreds of experts to visit overseas factories and processing plants as well as farms. That was in order to check on safety standards, the products, the chemicals used and the methods of manufacture. We have never had to do this for ourselves since 1973 and—the Lords European Union Committee raised this issue some years ago—we simply do not have the expertise, staff or resources to do this work, and neither do the individual British companies doing the importing. The regulations that we have made post Brexit make it clear that doing this checking is an onerous activity for the importers. We simply do not have the facilities or the staff to do it, and the result is that we are going to be vulnerable to unsafe children’s toys, unsafe electrical goods and unsafe food entering the UK. Criminals will exploit that because they will see a gap in the market.
The EU is not stupid. It will want to ensure that nothing that is unchecked or potentially unsafe, because we have not been doing the checks, will be allowed to be exported by the UK into the EU later on, so there are some serious problems there. This is not to attack or denigrate any Commonwealth countries, but the fact is that the UK does not have the facilities or the resources to cope with such a large, unplanned expansion of trade with the 54 countries.
Lord Sarfraz (Con)
My Lords, I too thank my noble friend Lord Howell for securing this debate. If we are to realise our ambition of achieving $2 trillion-worth of trade within the Commonwealth by 2030, we must build and strengthen the institutions that will facilitate that trade. Today, the Commonwealth does not have a trade finance bank, a development finance institution or an investment guarantee agency. It should probably have all those things and much more, but what we have is the immediate opportunity to ensure that digital co-operation is a fundamental part of our trade deals with Commonwealth countries. We wrote an excellent digital trade chapter into the Japan deal that is a model to draw inspiration from.
Most of the Commonwealth is still offline. Only 27.8% of the population of Commonwealth countries have internet access. The opportunity to grow connectivity in digital trade is massive, but the disparity is significant: six Commonwealth countries make up 98.8% of the Commonwealth’s exports in high-technology goods. Tech workers across member states are keen to do business. On the freelance job website Upwork, there is an oversupply of tech workers from the Commonwealth, and on average only 6% find work.
It is not just about bilateral trade. The big prize is for member states to sell more digital products and services to each other. There are existing initiatives within the Commonwealth that we can build on. One of these is an organisation called COMSATS, a 26-country network, accredited by the Commonwealth and headquartered in Islamabad, which operates universities, engages in science diplomacy and runs innovation labs. It has built a powerful brand and demonstrates the impact that technology co-operation has in building good will.
Some 60% of the population of the Commonwealth are under the age of 29. We aim to be a world super- power in science and technology. The opportunity here is absolutely clear.
Lord Haskel (Lab) [V]
Like other noble Lords, I welcome the principles of human rights, equality and tolerance expressed in the Commonwealth charter. Renewing trade with the Commonwealth has an important contribution to make in maintaining those values, thanks to the average 19% reduced costs for bilateral trade.
The Commonwealth is diverse. It incorporates some of the world’s richest nations and some of its poorest. A working paper from the Commonwealth Secretariat shows that this will inevitably mean that, as our trade increases with the better-off members such as Australia, the poorer Commonwealth countries will lose trade and suffer a decline in GDP. The Government have promised a scheme to help the less-developed members to overcome that with duty-free or quota-free arrangements. Is that in place?
The pandemic and resulting economic slowdown will put a strain on Commonwealth trade. That will require special efforts in healthcare and biotechnology, as my noble friend Lady Chapman explained. As more business goes online, so digital technology and connectivity will be important, as the noble Lord, Lord Howell, and others have told us. As the Prime Minister is the current chair-in-office of the Commonwealth, are we focusing on the connectivity section of the Commonwealth leaders’ agreement of 2018?
Some of the smaller, less-developed Commonwealth countries have enjoyed selling products such as textiles and clothing to the EU and Britain at zero tariffs under the most favoured nation arrangement. Presumably, that will continue. Surely the Commonwealth Secretariat should undertake an analysis of that trade to see if it can be developed.
At a time when, as others have put it, we are waking up to the legacy of our colonial history, we must ensure that it is not used to damage Commonwealth trade by undermining the shared values mentioned by my noble friend Lady Chapman, the right reverend Prelate the Bishop of St Albans and others.
In spite of many speakers’ enthusiasm, renewing trade with the Commonwealth will provide only a minor boost to our economy. Surely our priority must be to find ways to boost productivity and innovation here, to equip workers with the necessary skills and, as my noble friend Lord Triesman said, to build bridges with our nearest and largest market.
Lord Hannan of Kingsclere (Con)
My Lords, we should guard against sentimentality. It is a particular temptation when discussing this association of nations to which we are bound by language, law, culture, kinship, history and habit. It is almost impossible if you are in this country not to be slightly misty-eyed when we think of the two great global conflagrations of the 20th century and of the millions of young men who rushed from every corner of the Commonwealth and Empire to take up arms, in many cases for a country on which they had never set eyes, because they believed in our shared values.
Yet, as my noble friend Lord Howell says—correctly and wisely quoting Her Majesty the Queen—the Commonwealth is the face of the future. The case for it is not nostalgic or sentimental. At some point in this decade, the Commonwealth’s GDP will overtake that of the European Union. We live in an age when geographical proximity has never mattered less. In the 1950s, it may have made sense to form regional trade blocs, but many of those arguments were broken down by advances in containerisation, travel and the internet, and have been accelerated by our experience in the past 15 months in lockdown. We are now all much more accustomed to having sensitive commercial conversations over Zoom and Teams, so the case for cultural proximity rather than accident of geography has never been more eloquent.
There is one other form of nostalgia that I have heard in this debate. Perhaps I am wrong, but I cannot help feeling that, as with all our global trade deals, some noble Lords are still a little bit resentful about our withdrawal from the European Union and are looking for pegs on which to hang their opposition. We heard a little bit of it from the Front Bench—perhaps we will hear some more from the Front Bench spokesmen who will close this debate—when noble Lords talked about the importance of not trading with countries that do not meet our food production standards. There has been one major divergence post Brexit between British and EU food production standards: the decision recently announced by the EU to allow some animals to be fed on bits of other animals. We can argue about whether that was a good thing but clearly those noble Lords who have been arguing—and perhaps are planning to argue again today—that we should not trade with countries that have lower food production standards than ours must therefore be prepared to argue that we should not have a trade deal with the European Union. I hope that they will not erect barriers vis-à-vis the rest of the world that they would not erect against Brussels.
Let me close by saying that the Commonwealth is not just a voluntary association. By virtue of being voluntary, it brings out the best in all its members. It encourages us all to live our best lives and any strengthening of the Commonwealth must therefore be reckoned a net augmentation of human happiness.
Baroness Quin (Lab) [V]
My Lords, I, too, begin by congratulating the noble Lord, Lord Howell. I know from both Houses of Parliament that he has a long-standing interest in the Commonwealth and international trade. Indeed, I remember serving under his chairmanship on what was then the UK-Japan 2000 initiative and the work he did in strengthening our partnership with that country.
I share the ambition of strengthening our trading relationship with the Commonwealth but, like others—including my noble friend Lady Chapman, whom I warmly welcome to her new role—I stress that the Commonwealth is also about much more: shared values, an evolving friendship of equal partners and a willingness to co-operate on many levels.
At this stage in the debate, with so many points made, all I can do is take up some of them that I am particularly keen to see the Minister address in his reply. I hope that the Government will reflect on the powerful points made by my noble friend Lord Grantchester about human rights in our recent debate on the Cameroon trade agreement. Cameroon is out of step with the Commonwealth on so many issues and has been for a long time, not just in the recent and alarming attacks in anglophone areas.
In that debate, the noble Lord, Lord Kerr, pointed out some of the problems that the Government’s trade and co-operation agreement with the EU poses for trade with third countries, including Commonwealth ones, arising from the rules agreed on diagonal cumulation and rules of origin. In that debate, the Minister said that he would write to the noble Lord on that point. In view of the importance of the issue, I wonder whether the Minister’s letter could be circulated to all Members.
In the Library briefing for this debate, reference was made to the Commonwealth Secretariat producing a paper showing that some of the benefits of our agreements with Australia, Canada and so forth might impact negatively on some of the poorest countries of the Commonwealth. My noble friend Lord Haskel mentioned this; I wonder whether the Minister can respond to that point.
The Library paper also made this point:
“The Commonwealth accounted for 9.1% of the UK’s total trade in 2019, around the same as the UK’s total trade with Germany.”
To me, this means that we must be realistic about the short term. Aspirations for global trade and looking for opportunities cannot mean neglecting the biggest market on our doorstep or failing to tackle the problems that have reduced our European trade since Brexit and which are causing so many difficulties, particularly for small businesses and the food and drink sector.
Finally, what part does the environment play in the Government’s thinking on these issues? Geographical proximity matters in terms of reducing unnecessary air miles and sea-polluting journeys. Will the Minister comment on that in his reply?
Lord Marland (Con) [V]
My Lords, I am grateful for this opportunity to speak. I am particularly grateful to my noble friend Lord Howell, who has been nothing but a champion of the Commonwealth for so long and a huge support for me and my organisation. I am also flattered by the words of my noble friends Lord Risby and Lord Lansley.
I chair the Commonwealth Enterprise and Investment Council. I also declare my interest as a trustee of the Commonwealth War Graves Commission. The Commonwealth Enterprise and Investment Council was set up by the Heads of Government of the Commonwealth. It is a not-for-profit membership organisation. It is commercial and promotes trade and business within the Commonwealth. Since I have been chairman for the past seven years, it has opened hubs or offices in 10 or more countries, including Sri Lanka, Malaysia, Malta, the Caribbean, Nigeria, Ghana and Gibraltar, as well as in Bangalore three weeks ago. Our prize office is in the City of London, which has been tireless in its support for the council.
I assure the noble Baroness, Lady Bennett, that the council has an excellent female chief executive and a diverse board, and promotes diversity within business in the Commonwealth. Last week, we hosted a webinar, led by Lewis Pugh, who is swimming the oceans as UN ambassador for the oceans, to draw to attention plastics in the ocean. We have kept the flame alive in the past 12 months in these difficult times. In fact, our membership has grown through the webinars and Zooms that we have carried out; the last one had 850 people attending.
I regret that the UK Government have not taken up with gusto the opportunity of the Commonwealth advantage during their chair in office, being paralysed in a Brexit or post-Brexit Britain and worried, I suspect, by the dreadful word “imperialism”. That could not be further from the truth. Imperialism does not really exist in the minds of most Commonwealth people any more. Of course, modern imperialism is preaching to democratic countries and their elected leaders about what we think are the right or wrong ways to run their country; the words “glass houses” and “stones” spring to mind. It is through this imperialism that many of the Commonwealth countries have walked into the open arms of China so, if that is what we are trying to do, we should be looking at it in a different manner. It is quite clear that the promotion of free trade, for which Britain is a fantastic advocate, is the route out of poverty and may well be the route to helping these emerging markets to understand some of the concerns raised by noble Lords in relation to human rights and other practices, as well as to climate change issues, which we take very seriously.
Half the top 20 emerging countries in the world are Commonwealth countries. Do the Government not owe it to Her Majesty the Queen and her son, the Prince of Wales, who will take over from her, who have led the Commonwealth with exemplary leadership, holding this diverse group together, to support it in a far greater way than they have done? After all, the Commonwealth has the English language, a similar rule of law and shared interests, as has been mentioned by noble Lords—
Baroness Scott of Bybrook (Con)
I remind the noble Lord of the three-minute limit.
Lord Marland (Con) [V]
It also has education, sport, friendship and the 16% Commonwealth advantage. Believe me, the Commonwealth brand is still strong.
Lord Purvis of Tweed (LD)
My Lords, it is a pleasure to follow the noble Lord and to commend his work and that of the council. As he rightly said, the strength of the Commonwealth offering is one which, if we see the current trajectory both continue and accelerate, will be to the United Kingdom’s trading and international benefit. I also commend the noble Lord, Lord Howell, for bringing this debate to us; it is a very timely debate. He speaks with great wisdom on this issue, as has been recognised across all Benches, and his wisdom is based on experience, but it is relentlessly forward-looking and challenging. That has set the framework for this debate, which other noble Lords have followed.
The noble Lord, Lord Hannan, I think, wanted to write some of my speech for me. I do not know, but I might be disappointing him by saying that I agree with him entirely about not being nostalgic for something that we left last year or something that some noble Lords have said we turned our back on 50 years ago. International trade does not like nostalgia anyway because—as he said, and I agree, and as the noble Lord, Lord Howell, indicated—trade today in the 21st century is markedly different and, indeed, more complex. It touches on much wider areas, including standards, supply chains, human development and other areas. Of course, with e-commerce we are trading in manners and ways that our predecessors in trade would never have imagined possible. The Commonwealth is a network that is forward-looking.
Some have described the Commonwealth as a hub-and-spoke model, but in many respects it is a blockchain; it is a model of networks. When I co-chaired, with the Nigerian Trade Minister, an inquiry for the All-Party Group on Trade out of Poverty, one of our witnesses said something that has really stuck with me since then. She said that there were two major benefits to the Commonwealth: one was that America was not a member and the second was that neither was China. A network of commonality and consensus, which has values at its heart—even though we recognise that sometimes these have been challenging and challenged—nevertheless provides a very good basis for growth.
One of the reasons why we should not be nostalgic is that the trading world that the UK operated in before we joined the European Union was already changing. As the noble Lord, Lord Lansley, indicated in respect of our free trade agreements, it is, perhaps, an odd quirk, but probably deliberate, that we are now a party to more free trade agreements with wider and deeper benefits with more Commonwealth countries because we were a member of the European Union, which had entered into agreements with those countries. Now we are seeing the successor of them, and our challenge is how to develop and grow them—but not necessarily simply to view the world within a simple tariff-preference scheme that existed within the Commonwealth Preference Area.
It is perhaps little recognised or remembered that the Commonwealth Preference Area was not necessarily reciprocal. For example, the Commonwealth Preference Area for Ghana and Kenya was unilateral for the United Kingdom, but not reciprocal for them. For the first time, therefore, we entered into free trade agreements with Ghana and Kenya through the European Union and now we have the continuity. Our debates will be on how we can develop that further. As noble Lords have indicated, with Australia and Canada now being negotiated, how can we look at our future trade agreements post European Union with our Commonwealth partners to take advantage of the Commonwealth advantage? The Commonwealth advantage includes the direct inflows of investment as well as goods and services.
It is interesting to me to note that the Commonwealth represents 14% of global GDP but 28% of global FDI flows. Most of that grew rapidly through London and our being part of the single market, and one of the challenges that we will be entering into now is what our trading partners in the Commonwealth will see as the UK’s position through the City of London and how the FDI flows will continue to develop.
As has been indicated in the debate, intra-Commonwealth trade has doubled in little over five years. Growth potential post pandemic is even higher, as we have now surpassed more than $1 trillion and have an ambition to meet $2 trillion. The group that I had the pleasure of co-chairing had started to look systematically at what the barriers were that could potentially mean that that growth would not happen. We also argued for a step change in activity, and I will touch on some of the key areas.
We also wanted to link in human development. It is a reality with the global goals—and all of the Commonwealth countries signed up to the global goals—that we share an ambition, especially in goals 4 and 8, to seek poverty eradication in human development. It is a fact that, within the Commonwealth, 440 million women, men and children live below the poverty line of $1.90 a day. If you are born in the Commonwealth, you are twice as likely to live a life of extreme poverty as if you were not born in the Commonwealth. Trade and development are therefore critical. As the noble Baroness, Lady Chapman, highlighted—and I too welcome her to her position—the disparity in vaccine availability is an illustrator of this, and I agree with her. Uganda paid three times as much for AstraZeneca vaccines as the United Kingdom. Both are supposedly at cost, but the reality is that for many countries the costs are significantly higher. Two-thirds of the world’s small states, with populations of less than 1.5 million, are members of the Commonwealth, with very limited capacity to see trade facilitation and expansion. Therefore, the larger and more developed Commonwealth countries also have a responsibility for very close partnership working.
The first area that we considered to overcome was reducing costs and risks in trade and investment. E-commerce, for example, is one of the key areas where there is opportunity, and I agree with the noble Lord, Lord Sarfraz, who outlined—so I do not need to—the disparity in connectivity within the Commonwealth. This also links, as he mentioned, with the youth profile. Of the 2.4 billion people in the Commonwealth, 1 billion are under 25 and 60% are under 30. This presents huge challenges but also a massive opportunity, because 44% of the world’s entrepreneurs are aged between 18 and 35. Many non-tariff barriers exist for them, such as limited access to finance and capital assets, limited business networks, limited market information, and limited trade support.
When we develop that, and look at young women, we know that in Kenya, for example, 24% of SMEs are owned by women, and in Rwanda it is 26%. Most Commonwealth countries still have legislative and structural barriers to women entering the economic marketplace—on public procurement, on legal reform, on supply chain assets and access to finance. The Commonwealth Parliamentary Association and others, as the noble Baroness, Lady Hooper, indicated, have provided model laws on e-commerce and reforms. These are all positive and we should be doing our own work to support those, SheTrades initiatives and others, so we can make sure that the majority of the population —that is, women—are economically active.
The other areas focused on strengthening partnerships —building them through the diaspora, in particular—and the absolute benefit we have with commonality in our legal frameworks, our regulatory frameworks and, broadly, our standards. Yes, there are differences which we will need to resolve, but all have a degree of commonality that provides an excellent platform.
Where could we go forward? As the noble Lord, Lord Marland, indicated, the UK has a real opportunity now with the extended chair in office. The group I co-chaired called for a new Commonwealth trade and investment mandate, and for the UK to bring its convening power to the Commonwealth convening power, so that it can set an agenda at the WTO and other rule-making bodies, which the Commonwealth is not and should not necessarily be. Nevertheless, a new mandate with co-ordinated and strategic Trade Ministers looking systematically at intra-Commonwealth trade barriers will be a benefit to the United Kingdom. Leading up to the next CHOGM, I hope the UK will seize this opportunity and play a significant role in allowing intra-Commonwealth trade to develop. This will benefit the UK and set us on a trajectory so that, at the end of the decade, we will have $2 trillion and the UK can look forward and absolutely not be nostalgic.
Lord Grantchester (Lab)
My Lords, the Commonwealth is an important institution. While it might reflect on its upbringing from the past, it nevertheless has a continuing relevance and impact. It is a voluntary association of 54 countries, with almost a third of the world’s population, and stretches all around the globe.
It has been a very interesting debate this afternoon and I am grateful that so many notable contributions have been made today. These include that of the noble Lord, Lord Marland, the present chairman of the Commonwealth Enterprise and Investment Council. I am grateful to him and many others with notable Commonwealth experience, and experience elsewhere as envoys or representatives of trade. For example, the noble Lord, Lord Bilimoria, president of the CBI, works with India; the noble Lord, Lord Risby, with Algeria; the noble Baroness, Lady Hooper, through the CPA; my noble friend Lord Triesman was Minister for the Commonwealth; my noble friend Lady Liddell, was high commissioner to Australia; and my noble friend Lady Donaghy also has experience. For the first time, we are to be responded to by the noble Viscount, Lord Younger, while the International Trade Minister, the noble Lord, Lord Grimstone, is busy overseas on a trade mission. I am grateful to the noble Lord, Lord Howell, for introducing the debate and for initiating discussion on trade matters, particularly in relation to the Commonwealth. It is an opportune moment to recognise the Commonwealth’s potential to bring opportunity and benefits, such as the vaccines, spoken about by my colleague and noble friend Lady Chapman.
Now that the UK has left the EU, it can strike wider agreements independently of the EU and must refamiliarise itself with this responsibility, undertaking meaningful dialogue with industry, communities and Parliament in the process. It is regrettable that the Government continue to approach trade agreements as an executive role of prerogative, relying on the outdated CRaG process that governed agreements while the UK was an EU member state. I am grateful to the noble Lord, Lord Lansley, for his remarks as a member of your Lordships’ International Agreements Committee. He has often spoken about, and stressed the need for, a more meaningful process of scrutiny through the parliamentary approval process.
Let me be quite clear: on this side, we are in favour of good trade. We want good trade deals that grow the economy, bring greater wealth to nations, stimulate enterprise and sectors, protect livelihoods and standards, and reflect the modern approach to trade that goes wider than mere economic exchange: free trade, yes, but with a purpose. If that can be achieved through agreements with Commonwealth countries via proper parliamentary scrutiny, we welcome that. If they are bad agreements, we will say so. That does not mean we are against trade, just as it has nothing to do with Brexit or nostalgia. It means it is a bad deal—as simple as that. We want the UK to do better: to have better agreements, and ones that benefit all sectors of the economy.
The Commonwealth continued to trade, and will continue to trade, with the UK as we seek new wider agreements in this new environment. The UK and the Commonwealth have the distinct advantages of a long association, cultural ties and shared values. The Government must take account of that and build more progressive agreements. That does not mean signing up to any agreement. From the signs of this Government’s record so far, Ministers appear not to have the same approach. There does not seem to be any strategic policy; it appears to be trade at any cost. Let us consider the recently announced agreement in principle with Australia, a Commonwealth country, and the first deal struck after securing the continuation of trade agreements from EU membership. Instead of using this opportunity to create jobs in every sector, drive up economic recovery and raise standards around the world, the Government have done the opposite. This agreement in principle gives Australia all and more than it wants—indeed, all it could ask for—with potentially devastating impacts on UK food producers and their industry. The noble Lord, Lord Wigley, is quite correct to draw attention to this in his remarks concerning Welsh lamb producers.
It remains to be seen what the Trade and Agriculture Commission will make of it as, following concessions in the Agriculture Act and the Trade Act, its recommendations are awaited and it has not even been constituted as a statutory body yet. The Government have yet to respond to the report from the previous TAC. Has the deal undergone the proper, considered scrutiny before agreement?
This deal sets a worrying precedent for the UK but a potential bonanza for other Commonwealth countries, such as India, New Zealand and Canada. The noble Lord, Lord Haskel, is concerned about the effects on the remaining Commonwealth nations. I would be grateful to hear the Minister’s remarks in that respect. Furthermore, what will be the cumulative effect in the UK, when countries such as America and Brazil, outside the Commonwealth, join in with similar deals?
Another important aspect of international trade is its effect on the progress of human rights. I am grateful to the right reverend Prelate the Bishop of St Albans, who spoke forcefully on this aspect, as did the noble Lord, Lord Hussain, and my noble friend Lady Quin. The Government have repeatedly said that they were involved with international forums, including the Commonwealth, to promote human rights, but in rollover deals and deals in progress, the UK’s approach has been marred by inconsistencies. In your Lordships’ House Ministers have repeatedly said:
“Trade does not have to come at the expense of human rights.”
The Government argued forcefully against my noble friend Lord Collins’s human rights amendment to the Trade Act. They argued against the genocide amendment from the noble Lord, Lord Alton. They argued again against the Motion to Regret on the Cameroon agreement. In Cameroon, another Commonwealth country, the Government there have committed widespread abuses of the English-speaking population since 2017. Yet the Government rolled over this EU agreement, without allowing a proper debate to take place in the Commons.
The Government have also announced the Australia deal as a necessary precursor to agreeing the exact deal known as a CPTPP, which includes five Commonwealth countries. There is not one clause that the Government will seek any exemption from or amendment to. Compare that passive approach to a fellow Commonwealth country’s approach. New Zealand ratified this partnership agreement in 2018 but was prepared not to unless it was exempted from the provisions of the investor-state dispute settlement. Why, with concerns over ISDS, did the Government not also demand exemption? Why are the Government not using the accession process to press for improvements to the current provisions on financial services, small businesses and mutual recognition of qualifications? Why are the Government not arguing for new chapters to cover educational aspects, exports, chemicals, pharmaceuticals and co-operation on new technology? Many speakers this afternoon have high- lighted the importance of the digital economy and the benefits of digital connectivity.
The Government need to stop this headlong rush into poor agreements. They need to consider carefully, when in negotiation with Commonwealth countries or other international partners, what the implications of these deals are. The words of my noble friend Lord Rooker, with his experience in necessary inspections and checks, need to be heeded. The Government need to reflect on contradictions such as professing to uphold standards yet refusing to legislate for them.
We support the pursuit of good trade deals: ones that stand up for British interests, British jobs, British industries and enterprises, and British cultural values. Yes, trade can be a force for good, but it can also lead to disaster—to the export of good British industries, and to the diminution of Britain’s ability to bring greater progress to the world and its own reputation within it. The Minister’s actions so far are falling well short of this task.
Viscount Younger of Leckie (Con)
My Lords, I am very grateful to my noble friend Lord Howell of Guildford for initiating this debate and for his excellent opening speech. I know that this is a subject on which my noble friend is a considerable expert, as a former Minister in the Foreign and Commonwealth Office, a former chairman of the Foreign Affairs Committee and a former president of the Royal Commonwealth Society. I believe that he has served in three Governments, going back to the Heath Government, then the Thatcher and Cameron Governments. His really is quite a record, and therefore his contributions are greatly welcomed around the house. His views today on the Commonwealth and its future were a most valuable tour d’horizon.
I also know that the current chair of the Royal Commonwealth Society, Dr Linda Yueh, is one of the advisers to the Board of Trade. I trust that this will reassure my noble friend and others that this Government are taking concerns about the Commonwealth to heart. However, I agree with the noble Baroness, Lady Liddell, that we need to raise the profile of the Commonwealth more. I hope that this debate will be helpful to that end.
My noble friend Lord Grimstone is, unfortunately, unable to conclude this important debate because he is currently overseas, fulfilling his ministerial duties to further UK trade and investment. I am afraid that, in this place today, your Lordships have his trade department aide-de-camp.
Our enduring ties with the Commonwealth countries spring from friendship, history, culture and sport. In just a year’s time, Birmingham will host the Commonwealth Games. No noble Lord has mentioned this, but I do so now: that unique global sporting event, often referred to as the friendly games, that brings the peoples of the Commonwealth together like no other. My noble friend Lord Sarfraz put it rather well when he said that trade deals are a vision of an interconnected future.
As head of the Commonwealth, Her Majesty the Queen is hugely respected and during her remarkable reign she has undertaken more than 200 visits across the Commonwealth, to nearly every member country, to cement those bonds of friendship. The noble Viscount, Lord Waverley, reminded us that we must never forget her legacy and he is absolutely right. Her Majesty was also raised by my noble friend Lord Hannan during his speech. My noble friend Lord Marland spoke of the role of the Royal Family—I think it has a very important role—and quoted Her Majesty as saying that the Commonwealth is the face of the future, and of course I thoroughly agree.
From Mumbai to Melbourne, Calgary to Kuala Lumpur and Birmingham to Brunei, the 2.5 billion people living in the 54 Commonwealth states offer huge trade opportunities for British businesses from all sectors and of all sizes, across all regions of the United Kingdom. This provides a strong platform for prioritising trade-led growth with countries that account for well over a third of the world’s population, and have the potential to produce more than a quarter of global GDP by the middle of this century.
My noble friend Lord Risby asked whether we should capitalise on the Commonwealth advantage. I note that my noble friend Lord Marland also raised this; while I am on my feet, I thank him for his role as chairman of the Commonwealth Enterprise and Investment Council, as others have done. The Commonwealth advantage is the observation that trading between Commonwealth countries is estimated to be 19% easier. Trade is dictated by not just geography but shared history, as I said earlier, and language matters enormously. This is why all Commonwealth members want to see intra-Commonwealth trade and investment raised to $2 trillion.
In 2018, at the Commonwealth Heads of Government Meeting hosted by the UK in London, leaders adopted the Commonwealth Connectivity Agenda for Trade and Investment, with the ambition of enhancing co-operation. As your Lordships will be aware, and as raised this afternoon, we had hoped to have a Commonwealth Heads of Government Meeting in Rwanda last month. This, sadly, had to be postponed for a second time due to the continuing global impact of Covid-19, but we look forward to the Rwandan Government and the Commonwealth Secretariat being able to reschedule it. I am afraid that I am unable to give any dates to that effect this afternoon.
CHOGM is an opportunity for Commonwealth Governments to reaffirm their ambitions and shared vision of trade. In 2018, Commonwealth leaders used the CHOGM to underline the importance of resisting protectionism and reaffirmed their commitment to free trade. From such a large and varied group of countries, this is an important message for the world to hear. Free trade helped to build Britain. It created jobs, businesses and entire industries, bringing wealth and prosperity to the UK and transforming the country into an economic powerhouse. It is free and fair trade that has helped reduce poverty on a scale unprecedented in human history, and that will help our country bounce back from the coronavirus pandemic and realise the ambitions of global Britain.
I take this opportunity to turn to the subject of vaccines and to welcome the noble Baroness, Lady Chapman of Darlington, to her seat. She is most welcome to this House and to her Front-Bench role. The matter of vaccines was also raised by the noble Viscount, Lord Waverley, and the noble Lords, Lord Triesman, Lord Bilimoria and Lord Purvis. It is an important matter, and the UK is committed to rapid and equitable access to safe and effective vaccines. As part of the G7, we have undertaken to share 100 million doses, and 80% of our doses go to COVAX. As noble Lords will know, COVAX is the multilateral mechanism and it has so far helped to deliver 95 million doses to 134 countries, including 31 Commonwealth countries. Decisions on sharing vaccines will be based on the continued reliability of supply chains, which was mentioned in this debate, and advice from the JCVI.
However, today free and fair trade and the global trading system which supports it are under attack from the increased use of non-market policies and practices. This distorts competition and reduces fairness and trust in the system, as emphasised in the most recent G7 communiqué. Yet there can be few things more important than championing free and fair trade, as rooted in our values of sovereignty, democracy, the rule of law and a fierce commitment to high standards.
The title of this debate refers to renewing trading relationships, but I might argue that it is more of a reboot of those relationships. Today, as we chart a new course for ourselves as an independent trading nation, our determination to deepen the economic bonds we share with the Commonwealth is stronger than ever before. While we were an EU member, we successfully pushed for EU trade agreements with Common- wealth countries. Consequently, out of the 53 other Commonwealth members, 29 have trade agreements that were part of our Government’s efforts to secure trade continuity. I will need to check with Hansard to see whether these numbers correspond with those mentioned in the speech of my noble friend Lord Lansley.
For example, while we have already secured a trade continuity agreement with Canada, we have also set out a clear path to begin negotiating a new and more ambitious trade deal there. Furthermore, we have announced the launch of negotiations on a UK-Singapore digital economy agreement, which will build on the momentum of the UK-Singapore free trade agreement to address new and emerging issues in the fast-growing digital economy. I will touch upon this theme a little later.
We know that trade is a key driver of economic growth, which can help raise incomes, create jobs and lift people out of poverty. It is therefore excellent news that we have secured development-focused FTAs, known as economic partnership agreements, with 27 Commonwealth countries. These agreements provide immediate tariff-free access to the UK market and, in return, these countries gradually liberalise their markets, with protections for certain sensitive sectors. This encourages export-led growth, supporting and creating jobs in these countries. Of course, this also creates opportunities for the UK, and through these agreements our trade with Commonwealth countries can and will continue to flourish.
Our current focus is on implementing these trade agreements to their full extent, but this is not the limit of the Government’s ambition. In the future, we will look at how we can improve upon these trade arrangements. I hope that helps answer a question from my noble friend Lord Lansley, who asked how we were going to deepen these. This would be to our mutual advantage, through close discussion with our partner countries in the Commonwealth.
In addition to our development-focused agreements, a further 16 Commonwealth countries benefit from unilateral liberalisation by the UK because of their status as least-developed countries or lower or middle-income countries. This scheme reduces or removes tariffs to goods imported to the UK.
Although less so today, there have been some voices who call for a Commonwealth-wide trade agreement; in other words, to effect the Commonwealth into a trade bloc like the EU. While I can understand this temptation, we need to remember that such a proposal would not simply be about easing trade between Commonwealth members and the UK but between all Commonwealth members with each other. That would be an enormous undertaking, beset with numerous practical difficulties for members with a wide spectrum of views and interests. It would also be a new departure for the Commonwealth, which has typically been a forum for discussion, technical assistance and sharing best practice. But if the aim of those who call for a Commonwealth trade agreement is to improve UK trade relations with our fellow Commonwealth members, they should look at the Government’s record on negotiating trade agreements. We are committed to working with our friends and allies in the Commonwealth to remove barriers to trade, and we are using our unilateral schemes and trade negotiations to do just that.
I want to touch on taking our trade agenda to the next level. Building on our success so far, we will put the UK at the centre of a network of modern deals, encompassing many Commonwealth nations. As the noble Lord, Lord Bilimoria, mentioned, on 14 June, we reached agreement in principle for a deal with Australia, and negotiations are currently ongoing with New Zealand. These deals will create significant benefits for the whole of the UK. I will touch upon the Australia deal later in my speech.
We will shortly begin negotiations to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership—so-called CPTPP, if I can pronounce that correctly—which includes six Commonwealth countries. We have also launched a consultation on a UK-India free trade agreement. This has been opened, as well as a call for input on a future agreement with Canada. I hope this answers the question from the noble Baroness, Lady Liddell, on how we are stepping up, as we should do.
In line with commitments made in the integrated review, the UK will be announcing the launch of a public consultation on its unilateral preferences scheme in the coming weeks. The Government will be keen to hear from stakeholders in the UK and overseas on how we can make our scheme even better.
I would now like to touch on a number of themes that were raised during this afternoon’s debate. One thing that came across loud and clear was the question of human rights, which was raised initially, I believe, by the right reverend Prelate the Bishop of St Albans, and also touched upon by the noble Baroness, Lady Chapman, my noble friend Lady Hooper, the noble Lord, Lord Grantchester, and the noble Lord, Lord Hussain —particularly in respect to Kashmir. They were all important speeches.
I hope that the noble Lord, Lord Grantchester, will forgive me, because I will be repeating some of the lines that he was repeating from what we have said. It is true that we are clear that more trade does not come at the expense of labour, environmental rights, human rights, or sustainable development. We want to ensure that economic growth, development and environmental protection go hand in hand. As an independent nation in control of our trading future, we will work with partners to support freedom, human rights and the environment, while boosting enterprise by lowering barriers to trade.
To take this theme further and to get into some detail, let me address the points raised by the noble Baroness, Lady Quin, who spoke in particular about Cameroon. The Government remain deeply concerned about the north-west and south-west crisis. We will continue to monitor the situation and raise our concerns directly with the Cameroonian Government and within multi-national fora, calling for inclusive dialogue and an end to the violence. Beneficial growth and support for democratic principles are not mutually exclusive. By encouraging trade we are helping those most in need, providing valuable employment and, as I said earlier, helping to lift people out of poverty.
Another theme raised quite rightly by the noble Viscount, Lord Waverley, the noble Baroness, Lady Prashar, and my noble friend Lord Risby, concerned the importance of promoting digital trade and the question of digital interconnectivity within the Commonwealth. The Commonwealth has members at all stages of development, as the House will know. The digital divide is a key issue that the Commonwealth faces. As part of the Commonwealth connectivity agenda, several connectivity clusters were established, including a digital cluster, which the UK co-leads with South Africa. This provides an opportunity for members to explore these vital issues and learn from each other’s experience.
I would now like to move on to the points raised by the noble Lord, Lord Wigley, backed up by the noble Lord, Lord Grantchester, on the Australia deal, with a focus on the concerns that Welsh farmers might feel. Some Peers have mentioned in support of the deal that the Australia deal is the first we have negotiated from scratch and it has a number of non-regression clauses in it. UK farmers are the best in the world—and that includes Welsh ones—and the Government are confident in their ability to adapt and prosper as global demand for high-quality sustainable food grows. We believe that a deal with Australia paves the way to membership of the CPTTP and the growing middle-class markets of the Pacific Rim. Those markets are already Australia’s focus, and it is unrealistic to think that large volumes of beef and sheep will be diverted to the UK from those lucrative nearby markets. In 2020, more than 75% of Australian beef exports and more than 70% of sheepmeat were imported to Asia-Pacific markets, where the cost of beef production can be twice as high as the UK in some markets.
We know that British customers have a preference for buying British, with Aldi, Budgens, the Co-op, Lidl, M&S, Morrisons and Waitrose all using 100% British beef. We expect any Australian imports to first displace EU production, the origin of 230,000 tonnes of our beef imports. The quotas and safeguards the Australians have set out provide protection and the ability to apply tariffs for the next 15 years, should volumes exceed specified triggers. I hope this gives some reassurance to concerns raised by noble Lords.
My noble friend Lady Hooper asked what the role of the Commonwealth Secretariat is. The secretariat supports members and this organisation is voluntary and member driven. On trade, the secretariat monitors how intra-Commonwealth trade is developing. This was expected at CHOGM this year, but we now expect the secretariat to publish its trade monitoring report this summer.
My noble friend Lord Lansley asked how we can deepen our goods continuity agreements with services chapters. This is a fair question, because services make up a growing share of global output and employment and now account for around half of global trade on a value-added basis. As the UK is a leading services economy, this has an important role to play in promoting services liberalisation worldwide, while helping to tackle the specific constraints holding back developing countries’ growth in this particular area.
I am nearly at my conclusion, but I would like to just refer to my noble friend Lord Howell. He spoke on a theme that was supported by the noble Lord, Lord Rooker, relating to the networks of the Commonwealth and what matters. It links also to the importance of the WTO. I would like to say something about the WTO and its new director-general, because we agree that Commonwealth networks are vitally important and reflect the shared history and values that underpin both the Commonwealth itself and the real business links that trade is built on. As the noble Lord, Lord Bilimoria, also noted, the new director-general of the WTO is a Nigerian, and therefore a Commonwealth national. Dr Ngozi Okonjo-Iweala has brought new energy to the WTO and we want to work closely with her. We are confident that the WTO will move forward under her direction and be helpful to us.
In conclusion, we share a rich and vibrant history with the Commonwealth, which is epitomised through a shared commitment to democracy, peace and prosperity, and a good degree of always good-natured, I am sure, sporting rivalry, to come back to Birmingham. As we begin to embrace the unprecedented opportunities that lie ahead as an independent trading nation, we must re-boost our bonds of prosperity with partners in dynamic markets. The Commonwealth was formed in 1949 with just eight countries. It now has 54 members and the combined GDP of Commonwealth countries reached $13 trillion in 2020. This is why our Commonwealth partners are central to our plans for the future. This Government intend to utilise this opportunity to work with our friends and allies in the Commonwealth, to deliver not just in the UK but around the world.
Lord Howell of Guildford (Con)
My Lords, I thank everyone in the Chamber and our electronically connected friends for all their excellent speeches. Indeed, I thank the Minister for his excellent survey of the Government’s position and his round up of the debate. All of the speeches have been reminders that there is much more to trade and commerce than just trade itself. Without the wider conditions, there is no trade, nothing occurs, and prosperity disappears.
There is the health and vaccine issue. The noble Baroness, Lady Chapman, was right to draw our attention to that, as did my noble friend Lady Hooper. The secretariat played a strong role in that, led by the secretary-general, Patricia Scotland, which I think has borne fruit, even with India’s colossal difficulties. There is also respect for human rights, which the right reverend Prelate the Bishop of St Albans reminded us about. There is the temptation or desire for others to join the Commonwealth, as my noble friend Lord Risby and the noble Lord, Lord Triesman, said. That point seemed to be more eloquent than any speech: if people want to join something, it must be good.
There is the climate threat, which my noble friend Lord Lansley referred to, and the need to help the smaller island nations, particularly by adaptation. I think we all understand totally the point made by the noble Lord, Lord Wigley, about fine Welsh lamb—how could we not? The basic point is that tastes, products and markets are changing. As my noble friend Lord Marland reminded us, there are completely new markets and new tastes, and new trade flows growing everywhere. My noble friend Lord Balfe reminded us that a lot of New Zealand and Australian products are going to the Middle East.
The message of all this is that we cannot stop where we are. We cannot go back; we have to go forward, and so does the Commonwealth, and so it is now going.