European Commission: Portfolios

Baroness Falkner of Margravine Excerpts

Wednesday 2nd July 2014 Lords Chamber

[Baroness Falkner of Margravine (LD)]

Given what my noble friend said about the importance of an economic portfolio, does she agree that the important thing for the Prime Minister to do is to find someone who is a heavy-weight, has good judgment and substance, irrespective of whether he or she is from Parliament or from outside of Parliament, and that he must particularly put aside considerations about by-elections and other partisan matters because, if Britain needs a strong batter for the internal market or trade, this is the time that it needs it?

[Baroness Warsi]

Where there are so many issues at stake, it is important that we nominate a strong candidate. My noble friend will be delighted to know that the Prime Minister has a strong line-up of strong candidates.

Middle East Peace Process

Baroness Falkner of Margravine Excerpts

Tuesday 1st July 2014 Lords Chamber

[Baroness Falkner of Margravine (LD)]

My Lords, we on these Benches deeply commiserate with the families and friends of Naftali Frenkel, Gilad Shaar and Eyal Yifrach. We join their families and the whole Israeli nation in feeling their loss and in sharing their unity at this time of great suffering. The noble Lord, Lord Bach, asked about contacts. I wonder whether, in those contacts, her colleague the Minister has discussed with both sides the importance of proportionality. Find the murderers, the perpetrators of this act, and bring them to justice, yes; but it is hugely important that the unity Government and the peace process should not be imperilled at this time of justifiable anger on the part of the Israelis. Will she take away the idea that, at the end of this, both nations will have to live together?

Iraq

Baroness Falkner of Margravine Excerpts

Wednesday 25th June 2014 Lords Chamber

[Baroness Falkner of Margravine (LD)]

My Lords, one always looks at a list of these kinds of debates on the Middle East and thinks that one will hear speeches from the usual suspects. Then, of course, one is astonished when one hears a rather remarkable delivery from someone who does not conform to the traditional view that most of us share in this House. The noble Lord, Lord Campbell-Savours, will not be surprised to know that I disagree with his analysis. I assure him that, although my notes were written before I heard him, he has not persuaded me that his recipe for success would have delivered nirvana in Iraq.

I am sorry that the title of this debate is about security and the political situation in Iraq. I think that points to the fallacy of western thinking in the Middle East which, in an increasingly interdependent and interconnected world, still sees developments there as taking place in sovereign states on the basis that they are entirely autonomous and self-contained units, completely in charge of their own destinies. That was never so in the Middle East, and even less so in the Arab world, which has a religious, linguistic and cultural construct irrespective of boundaries until recent history. Therefore, I will speak about Iraq today in the context too of developments in Syria, Iran and Saudi Arabia.

It is tempting to think of this current crisis and the potential break-up of Iraq as an entirely sectarian war between Sunni and Shia—the settling of scores, we are told, that are 1,500 years old. That is too simplistic an understanding of Islam, of the tribal loyalties and allegiances of the region and, moreover, it is a narrative which detaches the millions of Muslims who have embraced modernity and thrive in the interconnected and globalised world, at peace with themselves and with each other, both Sunni and Shia.

For us in the United Kingdom not to recognise our role in the history and geopolitics of the region is to deny that the West—most notably the United States and the UK—is heavily implicated in what has gone wrong across the region. The current period has its roots in the end of the Cold War when the four left-facing Arab nationalist countries in the region—Iraq, Syria, Libya and Algeria—were left without superpower support with the demise of the Soviet Union. It is instructive to see that not only have three of those countries been engulfed in conflict to a greater or lesser degree, but that the end of bipolarity has extended instability across the whole of the Arab world to include neighbouring countries too.

Our erroneous support for Saddam in the Iran-Iraq war, which resulted in the deaths of millions on both sides, and then US exhortations after the Kuwaiti liberation for Shias and Kurds to rise up against him—and then abandoning them when they did so to Saddam’s further brutality—cost tens of thousands of lives as his repression increased. The years of no-fly zones which enabled the Kurds to establish the roots of their autonomous region, and which was never going to be a long-term solution, culminated in the Iraq war of 2003, for which the party opposite bears so much responsibility. We will have to see the results of the Chilcot report to know the full extent of that culpability.

It is invidious to argue that the Iraq war has not led to where we are now. Of course it has. The House may have forgotten that on 23 March 2003, within three days of the invasion, all 22 countries of the Arab League, meeting in Cairo, supported a resolution condemning the invasion as a violation of the UN charter and demanding a complete withdrawal of US and British troops from Iraqi soil. Kuwait was the sole exception and it had its debts to repay to the US. There was not an iota of legitimacy in that war, as the Arab League saw it. It was no war of liberation for them.

So we moved from the upheaval created by the events of 9/11 and the Iraq war to the Arab spring. In the interim, all the countries of the Middle East experienced a rise of jihadi violence, something not known as a phenomenon in the Arab world until the invasion of Iraq. A comment piece in the New Statesman, a Labour-supporting magazine, says in this week’s edition in a colourful attack on Tony Blair—to which the noble Lord, Lord Campbell-Savours, probably referred—that,

“according to a 2007 study, the Iraq war ‘generated a stunning sevenfold increase in the yearly rate of fatal jihadist attacks’”.

I turn to the situation in Syria. In 2011, when Bashar al-Assad started torturing and shooting dead unarmed, innocent protestors whose crime was to ask for delivery on his own promised reforms and for some freedom, we were urged across both Houses to do nothing. I called for limited support through the sale of arms for the Syrian opposition forces from late 2011. I kept to that position until the Syria vote in the House of Commons on 29 August 2013 and our debate here in the Lords. Assisting one side in a war is not of itself immoral. If it changes the symmetry of war it may result in a lower loss of life as the other side is more inclined to sue for peace.

Any who are following the debates here in the past five years will have heard extraordinary interventions describing the sacrifices that countries have to make, whether they wish to be there or not. I particularly pay tribute to the speech of the noble Lord, Lord Hannay—who is in his usual place and will be speaking today—with which I entirely concur and by which I was enormously moved. His presence in our House is a great credit to us.

In the period between 2011 and the current day it is true that the civil war in Syria has become more sectarian, but it did not start out so. There was a period until the end of 2012 when the conflict was mainly between Assad’s forces and the Free Syrian Army. Latterly it was joined by Jabhat al-Nusra—which was an offshoot of al-Qaeda, not ISIS—and ISIS came into the frame only last year within Syria. My point is that there was a period when action by the West might have resulted in a lower loss of life, a lower cost in human misery and certainly a lower cost in the treasure that is and will be expended to bring stability to the entire region as it faces conflagration.

We are now in a situation where that conflagration, which first engulfed Iraq, then Syria and now Iraq again, seems to be beyond our capabilities to control. I have no solutions to offer that the Government will not already have thought of. Clearly it is a priority to secure a unity Government in Iraq inclusive of all sides. Clearly we need to impress upon the Kurds that doing a land grab in the middle of this crisis does not constitute legitimacy, so they cannot use the status quo ante as a precedent to expand their reach. Clearly we need to work with new urgency on a Geneva III. Surely the facts on the ground point us towards bringing both sides together in Syria in reconciliation and in common purpose against the jihadis.

We also need to use our leverage with Saudi Arabia and the Gulf states to cut off channels of support for ISIS. It cannot be sufficient for them to say that they are helpless and cannot control private or charitable donations, although I have to say that ISIS is swimming in funds from Mosul and its various extortion rackets; some $3 billion, we are told.

Let me say a brief word about the ideology of ISIS and the extremist jihadi groups. If their intention is to establish a caliphate in the Middle East, they will not stop at borders. Yes, they consolidate their gains, but the very ideology of a pan-Islamic caliphate is founded on the dismissal of boundaries. A further several decades of war confronts us should they be allowed to establish themselves. It is not a prospect we can countenance, and nor should we. We need to be prepared to act when and where there is an opportunity for us to do so, be it through intelligence, strategic support, force protection or the use of bases in the near term. In the longer term, our choices become harder. We are a UNSC power and our interests are engaged in preventing a major threat to international peace and security both abroad and here at home. Our interests are engaged to prevent a terrorist state controlling vital oil fields and maritime trading routes. Our interests are engaged because we are bound with those who are suffering the fatalities of innocent civilians in our common humanity.

I have said in the past that, while we cannot know of the consequences that any action on our part might bring, we know that inaction has consequences as well. This last year has shown us that. In the end, choices will have to be made as the Middle East is too strategically important on moral, humanitarian and economic grounds for us simply to be bystanders.

Ending Sexual Violence in Conflict, and Iraq

Baroness Falkner of Margravine Excerpts

Monday 16th June 2014 Lords Chamber

[Baroness Warsi]

The noble Baroness makes an important point and has tirelessly campaigned on this issue for many years. As the Minister with responsibility for both Pakistan and Bangladesh, I was incredibly pleased to have the opportunity to convince both countries to sign the international declaration on preventing sexual violence in conflict. I was delighted to see that both countries took that pledge. This could have consequences for their own nations and states, but both countries are also huge providers of peacekeeping troops, which are sometimes the first point of defence where this sexual violence happens.

Supporting victims was an essential part of the summit and one of the priorities. It includes supporting victims now, but also supporting victims from the past. As the noble Baroness will be aware, many of these horrific stories of sexual violence do not even come to the fore because victims are not prepared to speak about them. One thing that we can all agree on is that the summit gave a voice to survivors, and that in itself will start to tackle the cultural impunity.

[Baroness Falkner of Margravine (LD)]

My Lords, one of the reasons why my noble friend Lord Howell of Guildford and I always attempt to speak at the same time is because we so often agree completely with what each other has to say. In addition to endorsing everything that my noble friend said, I simply want to address two or three issues.

While I congratulate the Minister and the Government wholeheartedly on the ending sexual violence summit, she will understand if I concentrate my remarks on Iraq. I understand where the Government are coming from in keeping their assistance extremely limited at the moment, but will she tell the House whether the Prime Minister continues to abide by his royal prerogative in taking any measures that he considers necessary in order to persist with bringing about a resolution to the situation? This is the gravest political situation that we have seen since 2003, because if ISIS gets control of a swathe of territory we are in real trouble.

My second question relates to what the Foreign Secretary has been doing in his conversations with the Prime Ministers of the regional powers. Are we encouraging Saudi Arabia and Iran, which have recently thawed relations with each other, to continue to resolve this situation together? The noble Lord, Lord Bach, referred to Iran not having direct talks with the United States, but if Saudi Arabia and Iran can work together, that would be significantly helpful.

Finally, has there been any discussion in the Foreign Office and government about taking this issue to the United Nations Security Council? If there is one point where we need decisive action by the international community, it seems to be now. Events are moving very quickly indeed, so I exhort them to do so.

[Baroness Warsi]

My noble friend will be aware that the United States has said that all options are still on the table, but I can say that the United Kingdom is not planning a military intervention. We are looking urgently at other ways to help, examining where, for example, we can give support in relation to counterterrorism expertise.

My noble friend makes an important point about regional players. Saudi Arabia and Iran of course have a role to play. Many of these groups and countries unfortunately feel a sense of affiliation to certain sections within Iraq and it is important that we stress again the need for stability and communities to work together. I am not aware of any proposals at this stage for United Nations Security Council involvement, but if I do I will certainly write to my noble friend.

Palestine

Baroness Falkner of Margravine Excerpts

Monday 16th June 2014 Lords Chamber

[Baroness Warsi]

My Lords, we welcome the new technocratic Government, who are made up mainly of people who are not affiliated to political organisations. We are heartened by the fact that the quartet principles have been endorsed by the new technocratic Government.

[Baroness Falkner of Margravine (LD)]

My Lords, does my noble friend recall that over the last two years she has stood at the Dispatch Box and told the House on many occasions—I think mainly during 2013—that this year was the last chance saloon for achieving a peace process in the Middle East? Given where we find ourselves, what is the United Kingdom Government’s position on achieving a peace process now that the Americans have more or less said that there is nowhere further to go? Will the Government consider replacing the current system of the Middle East quartet envoy and so on with a fresh impetus and a completely new look at whether a two-state solution is indeed the right answer?

[Baroness Warsi]

My noble friend is right: I have stood at this Dispatch Box over the last 12 months, if not more, talking about the concern over the changing situation on the ground. We are running out of time to achieve a two-state solution because the situation on the ground continues to deteriorate. That is why we were so supportive of the discussions that Secretary Kerry was leading. My noble friend is also right that we have to start looking at other options that are available to us, because what we want in the end is a two-state solution. That requires a safe and secure Israel, but it also requires a viable Palestinian state. As to the role of the quartet, my noble friend will be aware that it is not just for the United Kingdom to impose who leads it. I would be interested to hear from the Benches opposite whether they feel a change in personnel is needed.

Queen’s Speech

Baroness Falkner of Margravine Excerpts

Wednesday 11th June 2014 Lords Chamber

[Baroness Falkner of Margravine (LD)]

My Lords, I thank my noble friend the Minister for setting out in very succinct terms the overview of where we are on foreign and defence policy today. However, I point out to her—I know that this view will be echoed around the House—that it was perhaps a bit of a mistake for the usual channels to schedule foreign affairs, defence and international development alongside the significant issue of constitutional affairs, over which, for the first time in 300 years in this country, we have a real dilemma. As it was known that some 80 or so speakers had put their name down, it would have been far better to have set aside separate days for these important matters.

I will stick to foreign affairs, as I would be expected to. My time is brief, so I will stick to just two things. The Foreign Secretary addressed a conference on globalisation last week at Chatham House, where he remarked that the world was more unpredictable and unstable now than in the last decade of the previous century. He also noted, wryly, that his period in office at the FCO coincided with some of the most unstable events that have taken place. Both statements are of course correct, but I am delighted to add that there is no causal link.

I will talk about the capacity of the Foreign and Commonwealth Office to undertake deep analysis and problem-solving that renders it—or should render it—equipped to undertake the level of strategic thinking that is required to deal with the level of instability that the Foreign Secretary spoke about. We know that the role of the Foreign Office has changed; it has had its own pivot, if one can describe it as such, towards being a more commercial and trade-focused arm of the UK Government. I also appreciate that the Government have made structural changes, such as the Foreign Service Academy and the language academy, but the positive effects of that will not be felt for some time. In the mean time, the capacity of our diplomatic service to see long-term trends and to identify policy responses does not seem as robust as might be needed for these difficult times.

One example of the lack of capacity is still the dearth of senior women in leadership roles in the Foreign and Commonwealth Office. In the lead-up to International Women’s Day in March this year, I asked several parliamentary Questions about the role of women appointees at the United Nations, the European Union, other international agencies, NATO, other permanent members of the UN Security Council, our allies, BRICs, and so on. The response I got was truly extraordinary, and bears repeating. Some 11 women had served in senior roles in the past 25 years—I was only able to go back 25 years—while 173 men had served in those roles.

At a time when women’s equality has been pursued by both the Labour Government and indeed by this Government, I was interested to read in the rebuttal to my letter in the Financial Times that Sir Simon Fraser, the Permanent Under-Secretary in the Foreign and Commonwealth Office, is a Civil Service diversity champion. We shall not hold our breath, although I fully respect the fabulous role that Sir Simon carries out as head of the Foreign and Commonwealth Office.

Diversity matters because problem solving is complex and requires considerable thinking outside the box—which is impossible where one gender or class dominates. I am not trying to say that excellence should be sacrificed to obtain diversity. Indeed, one other sector of excellence in the United Kingdom, the university and higher education sector, has embraced diversity to its credit. Diversity is one of the reasons it ranks so highly among higher education institutions in the world.

Let me turn to my other concern in terms of a lack of strategic thinking in the Foreign Office. That is thinking around dealing with failing and failed states—or indeed states that are too big to fail but that may have to be allowed to fail. The noble Baroness talked about Iraq and Syria, and we know that there are several failing states in Africa. I will concentrate on one in which I know the noble Baroness takes an interest, which is Pakistan. Pakistan suffered an egregious terrorist attack on its principal airport in its principal commercial city earlier this week. It is mired overall in an ongoing decade-long deep and existential crisis.

I discussed the problem of a UK strategy for Pakistan in 2008 with the then Prime Minister, Gordon Brown, and the then Foreign Secretary, David Miliband. The problem as I saw it was that the regional instability that an unstable and conflict-prone Pakistan would bring about was more profound and far-reaching than the issue of winding down the Af-Pak mission as it became to be known in the Foreign and Commonwealth Office in those days.

The very concept of Af-Pak as a single prism was flawed in my estimation. The nature and dispersal of power in Pakistan, which had had authoritarian rule over many decades, was very different from Afghanistan and needed disaggregation from the Afghan war nexus. I was sent off by the Prime Minister to meet the senior Pakistan people in the FCO and it became apparent to me that the advice they were getting was shallow and short-sighted. What we have ended up with, as we have seen with the attack this week, is a Pakistan—which is a nuclear-weapon state of some 170 million people—in which the writ of the Government does not run in large sections of the country. The Governments of the day, each as incompetent as the previous one, do not have a strategy of dealing with the Taliban and are caught in this dilemma of trying to make peace with the terrorists they themselves inculcated and tried to bring about.

In our Foreign Office today we conflate the role of the diaspora—the Pakistani ethnic minority diaspora in Pakistan—with the dilemma that we have as a United Nations Security Council member dealing with Pakistan as a foreign country. So in concluding, I will to come back to our role as a United Nations Security Council member and simply ask the noble Baroness one question. The role of United Nations Secretary-General is coming up for renewal and reappointment in 2016. Will the United Kingdom Government give its backing to a senior female potential Secretary-General should one come up on the horizon?

[Baroness Northover (LD)]

My Lords, perhaps I could just intervene and remind noble Lords that we do not have a fixed time; we have an advisory time of five minutes. We have 82 speakers and for the courtesy of those speaking later in the debate, I ask noble Lords to bear in mind that when the clock hits five, they have had five minutes.

Ukraine

Baroness Falkner of Margravine Excerpts

Tuesday 13th May 2014 Lords Chamber

[Lord Soley (Lab)]

This is a strong Statement and I welcome it very strongly. Can I ask the Minister to convey—

[Baroness Falkner of Margravine (LD)]

My Lords—

[Noble Lords]

This side!

[Lord Soley]

It should be this side.

[Baroness Falkner of Margravine]

My Lords, from these Benches I, too, wish to thank the noble Baroness for repeating the Foreign Secretary’s rather comprehensive Statement today updating us on the European Council. It is a happy coincidence that President Didier Burkhalter of Switzerland happens to chair the OSCE at this time, because the OSCE is the right body to defuse tensions. We were very heartened to see that he has suggested to the President of the European Council that he hold a series of round tables to try to mediate the situation. Can the noble Baroness tell us whether the Foreign Ministers of France, Germany and Poland—or, indeed, their representatives—will play a prominent role in the OSCE negotiations? That group of countries negotiated the first accord, which I think was acceptable to all sides in the conflict.

Will the noble Baroness also tell us about the position of Germany? I understand that the German Government are keen that Ambassador Wolfgang Ischinger, the chairman of the Munich Security Conference, should lead a separate round of mediation efforts. I am sure that the noble Baroness does not need me to remind her of this, but I put on the record that it is absolutely critical for the European Union to remain united on this issue through the OSCE. To have individual countries breaking off and setting up their own initiatives for their own geostrategic reasons can hardly be a welcome development from our side but would be welcomed by Mr Putin; it would be an opportunity for him to obfuscate further.

[Baroness Warsi]

My noble friend has always made very incisive and important points. President Didier Burkhalter is indeed leading the OSCE negotiations. Again, the parameters of those negotiations have been clear in relation to the cessation of violence, the facilitation of disarmament and the immediate establishment of a national dialogue. It is important that Ukraine delivers for the Ukrainian people and therefore allows stability within the nation to form the strength and backbone of its approach with Russia.

Our European partners and the Foreign Ministers to whom the noble Baroness refers support that process. It is important that there is a unified EU position. However, as I said earlier, there are 28 member states and Russia relies on the fact that the EU may have a difference of opinion within itself. I took great comfort from the Foreign Affairs Council meeting yesterday, given the fact that we managed to reach agreement on a much broader approach to sanctions. The agreement that, if there is a further escalation, there will be an escalation of sanctions shows that Europe is, thankfully, singing from the same song sheet.

China: Investment into the United Kingdom

Baroness Falkner of Margravine Excerpts

Wednesday 7th May 2014 Grand Committee

[Baroness Falkner of Margravine (LD)]

My Lords, I thank the noble Lord, Lord Wei, for that wonderfully powerful lobbying from a certain perspective—but that is what an APPG chairman is supposed to do—and I think that we were all extremely interested in everything that he had to say. I certainly will not disagree with anything he said, but I want to highlight a couple of different issues. Before I start, let me also say that this is my first interaction with the Minister, and I am delighted to be on the same side as him—but perhaps slightly opposed—in this very significant debate. I look forward to hearing what he has to say.

I want to pose a couple of general questions. One of the most important issues that should affect Britain’s economic and political considerations is where to draw the line between strategic interests and commercial interests. Not everything can be up for sale, and not everything can be sold to everyone. In the Dubai Ports World controversy in the US some years ago, a state-owned enterprise attempted to buy what was deemed a strategic US asset. At issue was the significant question of who controls US ports. By the way, this was not a right-wing Republican argument—one of the champions of the opposition to Dubai Ports World taking over US ports was one Hillary Clinton—as there were people on all sides who saw ports as a strategic asset and therefore vetoed the attempt by Dubai Ports World to take control. Ownership was not a significant issue, as P&O had ownership of the ports at that time, but ownership by a strategic ally is very different, in terms of public perceptions of security, from ownership by a non-transparent state-owned enterprise. The issue was ownership by a foreign power about which there were perhaps reservations, either about the state itself or about the record of the entity that was attempting to do the transaction.

Likewise, on the issue of Pfizer and AstraZeneca, we in the UK need to think long and hard about strategic assets and whether research and development, including scientific research, comes into the category of meeting the public interest test. I would argue that it does, not just because of the jobs and R&D spin-offs but because, where a primary purchaser is in a dominant position in relation to the state sector—that is, in the NHS—we need to ask whether we give disproportionate pricing power to a player in foreign ownership that would be in charge of that kind of strategic asset. I would say no.

Going back to the China debate, but keeping on that theme, one need only look at the ire or public sentiment that was aroused when another strategic industry—I shall use the example of UK water utilities—was privatised. The water companies were taken over by a state-owned enterprise, which in this case meant France’s EDF, and the profits reverted to the French taxpayer. There was considerable speculation about why, in an era of austerity, British schools could not be built but the French Government had sufficient in its coffers to do quite well with its public sector.

I have not mentioned any Chinese company as an example. However, the APPG report highlights that analysis of the growth in Chinese investment, which has increased by a factor of 13 since 2008, shows that much of the growth is due to a small number of M&A deals, which are dominated, it points out, by state-owned enterprises and sovereign wealth funds. So it is only a matter of time before we are caught in a controversy where a Chinese firm or a state-owned enterprise is involved, and hence the need for the Government to think through the broader principles in this area, particularly the security dimension. Needless to say, the manner in which an industry is run is critical to public acceptance. Where it is well run and the UK benefits from investment, there is usually little disquiet. However, when it comes to an issue where “rent seeking” is too blatant—which I think was the case in the water utilities—at a cost to the consumer, in my view there is cause for legitimate complaint.

A further strategic concern has to be around technology transfer. Only yesterday, noble Lords who take the Financial Times will have seen a report on security service chiefs expressing their concern about cybersecurity in the context of junior staff at IT companies being lured into positions through remuneration where they might be able to divulge vulnerabilities in IT systems to competitors. I should say that the description of a “competitor” in terms of cyberespionage is not usually the bread-and-butter business of the level playing field where there is healthy, market-led competition, but rather the ability of foreign powers to bring down assets in other countries. Estonia experienced that from Russia, the US from the Chinese, among others—that is well documented and recorded—and of course Iran from Israel and, vice versa, Israel from the Arab countries; that is just to name a few of the well known cases. The more overt commercial attacks, which can cause the economy much more harm, are often unreported for reasons of commercial confidentiality, although they have higher costs for the economy and the companies themselves. I wonder if, in answering this debate, the Minister will reflect on the question of how and to what extent we define strategic industries, particularly when the investor has low levels of transparency, there is no public accountability and our own leverage is potentially extremely limited due to the size of our economy in relation to that of the investor.

Another factor I want to touch on is not mentioned in the APPG’s report, but it touches on global trade and competition. I refer to the EU-China trade talks that have been embraced by the UK Government and for which they have become the cheerleader in the EU. I would not wish for a moment to appear to be opposed to the talks, and I am not, but I hope that we learn the lesson from the current crisis in the EU over Russian energy supplies to several EU states. It is serving to downgrade EU states’ resilience in security terms and some countries are virtually being held hostage by certain Russian companies in terms of pricing and the delivery of energy.

The lesson here is twofold. An overreliance by strategic sectors on one supplier gives the foreign owner too much power which it may exploit. Trade dependency is similar, and one must not get hooked on any one market. So, while we welcome investment from China and our investment in China, it is terribly important that we keep our eye on diversified markets and diversified investments. It may be exciting—in the case of China we are talking about a low base at this point; I accept that completely—and there is much to play for, but we need to keep an eye on the end game, which is that overreliance on either side may not be very healthy.

The second point is my final one, and it is about multilateralism. Over the entire post-war period, Britain has championed a multilateral, global, rules-based order, whether that was the establishment of the United Nations or the Bretton Woods system, the UNCTAD or the WTO. I am therefore sorry to see us taking a narrow focus on EU-China talks rather than EU-East Asian trade talks that would include the other powerful emerging economies in south Asia. That is what the APPG is about. My fear is that when large powers are allowed to break off from multilateralism into bilateralism, geopolitics comes into the frame and power is disproportionately distributed, thus disadvantaging weaker economies. I am really sorry that the APPG on East Asian business has not sought to battle for those other countries as well in this regard, but I am sure that it will do so in other reports. Indeed, I can see that the noble Lord, Lord Wei, is nodding his head, so I look forward to those debates.

In conclusion, I agree with all the conclusions that the report laid out, and I hope that the Minister will be able to take its recommendations on board, despite the omissions. On the emphasis of the noble Lord, Lord Wei, on having ambassadors within the UK, I should declare a very small interest. I happen to be chancellor of the University of Northampton and am delighted to report that, as of last year, the president of the Northampton students union has been the first Chinese national ever to be president of a students union in the United Kingdom. So we are an outward-looking university, just as we are a country.

Ukraine

Baroness Falkner of Margravine Excerpts

Thursday 3rd April 2014 Grand Committee

Asked by

[Baroness Falkner of Margravine]

To ask Her Majesty’s Government what is their assessment of the political situation in Ukraine.

[Baroness Falkner of Margravine (LD)]

My Lords, I start by thanking the several noble Lords who have taken a Thursday afternoon out after a long week to take part in this debate. I will not have an opportunity afterwards, so I thought that I would get in my appreciation of this fine attendance on an important matter here and now.

In 2014, as we look back on the centenary of the Great War, a plethora of new books reminds us that events can be overtaken by miscalculation compounded by misunderstanding. When tactics supersede strategy, an inevitability takes hold. Against the memory of those historic events, it is important neither to underestimate the events in Ukraine of the past few months nor to overstate parallels with the Cold War or other analogies. At this point, we cannot know where the invasion of Ukraine by Russia will lead us.

However, we can be sure of certain things: whether this is an act of historical significance is not in doubt. It has marked a change in the world order. In the past 20 years there has been a debate about the change in power politics, evidenced in the demise of bipolarity, with unipolarity and the US moving to hegemonic status after the demise of the Soviet Union. Alongside this has been the challenge to its neighbours posed by the rise of China and, in response, the US pivot to Asia.

The question in international relations scholarship in the past decade has been whether we are seeing the emergence of a multi-polar world, but one where essentially western norms and values have prevailed, with buy-in from emerging powers into “western” institutions, or whether we are living in “no one’s world”, as described by the American academic Charles Kupchan, where no single overwhelming power is dominant and norms are in a state of flux.

The events leading up to 27 February, when Russia invaded and seized Ukraine’s Crimean peninsula, seem to point in the direction of a passing of the old order, or indeed, in the words of the Economist, the forming of a disturbing “new world order”. The invasion of a sovereign country other than as an act of self-defence or under international humanitarian law, sanctioned by the international community, cannot be a light thing, even when carried out by a former superpower wielding a United Nations Security Council veto.

The excuses given by Mr Putin in drawing parallels with NATO actions in Kosovo are absurd. In Kosovo, there was grave and present danger of a severe humanitarian catastrophe after evidence of widespread ethnic cleansing in the immediate region. Attempts were made to seek consensus in the UN Security Council but, in the face of a Russian veto and after some deliberation, it was decided to take action through NATO.

Even more absurd are Russia’s claims that the Government in Ukraine are illegitimate and that, hence, Russia will not enter talks. In Ukraine, after months of ongoing protests against the elected Government and more than 100 people killed—mostly at the hands of state security snipers deliberately shooting to kill—it was the Parliament which, on 20 February, approved a resolution calling for a return to barracks of the military and a ban on firearms. Once the police and military conformed with the vote in Parliament, Mr Yanukovych and his allies decided that the game was up and fled to Russia. On 22 February, the President was deposed for abandoning his duties and an acting President was appointed. From that point, it took a mere five days for Russia to take Crimea.

This is not the first time that an elected Government have been driven from office, and it will not be the last. Only a deaf and blind leader can cling on to office when all around him see evidence of egregious corruption, human rights abuses and kleptocratic governance. Of course it is preferable that there be constitutional measures, such as votes of no confidence, to oust those who command no support, but the fact remains that Yanukovych lost the support of his own majority in Parliament.

I turn to the here and now and the consequences of the events of the past few weeks. The most immediate are for the people of Ukraine. They have 40,000 Russian troops massed at their border with full logistical back-up support for invasion, including military hospitals. The threat is palpable. According to NATO, a Russian invasion could be accomplished in between three and five days, with the potential to take Moldova and Transnistria as well.

Alongside that are Ukraine’s economic woes. Without deep and structural reform, and with sovereign default on the horizon, the EU offer of a $15 billion loan is welcome. Ukraine’s currency fell by 30% between November and late February, and the Government are now running out of funds to cover public employees’ salaries. Although it is entirely understandable for the IMF to seek to protect its funds from corruption by sticking to its stringent conditions and reform agenda, it is surely somewhat dangerous for the fund and the EU to dither while Russia destabilises the interim Government from within, as well as starving them of energy.

I hope that the Minister will be able to tell us what conversations the Government are having with the IMF about a speedy allocation of funds and whether the UK is having conversations with the German Government about additional bilateral loan guarantees by those countries within the EU which can give—a coalition of the more solvent, perhaps, rather than a coalition of the willing.

There is also the present question of the Ukrainian elections on 25 May. What arrangements are being drawn up with the OSCE for the elections, which are now only some five weeks away? There has been gnashing of teeth in European capitals about the Kerry-Lavrov talks. In my book, they are a welcome development. They are less neo-imperialism and perhaps more pragmatism. EU foreign policy co-ordination is still embryonic. I experienced that myself last weekend at the Königswinter conference in Cambridge, where my German colleagues took a rather different view. “Our histories are different”, they said, “hence the lack of an EU strategic Russia policy”.

For Ukraine, after the formation of a new Government, it is imperative that that Government build a consensus for enhanced protection for minorities and entrench it constitutionally with strengthened regional autonomy. It is a relatively new state, and centralised structures seldom work when there is significant diversity in the population. Alongside Ukraine, we, the international community, should not write off Crimea. There is a tendency among policymakers to write off a land grab by Russia. There is an element of fuzzy historical referencing accompanied by a shrug of the shoulders.

I make it clear that I am not advocating a NATO invasion to free Crimea, despite the illegitimacy of its referendum and return to Russia. There has been a change to the territorial integrity of a sovereign state by its neighbour. Should that situation be accepted unchallenged, it presages similar attempts across the world. There will be few countries with minority populations across borders which cannot but worry about the consequences that will flow from Crimea. So every instrument of negotiation from asset freezes to sanctions and a recalibration of hard power as deterrents must be employed to sanction the aggressor.

The costs will be borne by us all, the Russians as well as the EU states, but the upholding of international law through sanctioning an aggressor may be the lesser cost in the long run. If by demonstrating that there is a united response from the West a negotiation can indeed be brokered with Russia along the lines that Crimea be reinstated within Ukraine, with an agreement that Ukraine be not given NATO membership for a period, that would appear to be the minimum acceptable outcome.

In concluding, I return to my opening remarks about the importance of upholding international law. Assurances need to be credible to be worth the paper they are written on. One casualty of the Crimean invasion is that there is less confidence in the West’s assurances in a post-Crimea world. This will undoubtedly affect our efforts to curb nuclear proliferation but will also diminish the West’s standing in a host of other matters.

Without being slavishly pro-American, there are many in the UK and Europe who have regretted the US’s increasing isolationism. Indeed, it was notable that last week was President Obama’s first visit to Brussels since his first election in 2008. While we have welcomed the closer trade links to flow from TTIP and, belatedly, a new emphasis on EU-US co-operation across foreign affairs generally, the events of the past few weeks, too, have illustrated the importance of hard power as a deterrent. It is evident now that we cannot neglect any of these aspects of power politics; it is better to learn those lessons now than allow an orderless world to emerge. I look forward to the Government’s response to these challenges.

Ukraine

Baroness Falkner of Margravine Excerpts

Tuesday 25th March 2014 Lords Chamber

[Baroness Warsi]

Those are exactly the kind of areas which the £10 million package which I referred to will be covering. I think there is some Westminster Foundation for Democracy work already in play in Ukraine, but I will check and write to the noble Lord.

[Baroness Falkner of Margravine (LD)]

My Lords—

[Lord Howe of Aberavon (Con)]

My Lords—