Exiting the European Union and Global Trade

Debate between Iain Duncan Smith and Liam Fox

Thursday 6th July 2017 Commons Chamber

[Dr Fox]

My hon. Friend makes an excellent—and key—point. Getting the global economy moving requires the major liberalisation of services in the same way as we had the liberalisation of goods as the focus of the Uruguay round. One thing that comes from that is that countries such as the United Kingdom, where about 80% of the economy is service-driven, are less dependent on being part of a geographical bloc for trade. When it comes to trade in services, what matters is that we are dealing and trading with countries that are functionally similar rather than geographically proximate. That is a change in globalisation we would do well to understand in the debate as we leave the European Union.

It is not just about raising living standards in developing and developed countries. There is, I think, an even more compelling case for free trade. The prosperity it can create is the basis of a social stability that underpins political stability. We have seen that around the world. That political stability, in turn, underpins our security. In other words, they are all part of the same continuum, and we cannot disrupt one element without disrupting the whole. That is why Governments of both colours in this country have tended to see development, prosperity and security as a single policy objective. It is a truth that we need to understand in this interdependent, globalised era.

[Mr Iain Duncan Smith (Chingford and Woodford Green) (Con)]

It is not just us making this case. In the discussions with those who are involved in the World Trade Organisation—even though we are a member, we want to get back our voting rights—they have made it pretty clear that they celebrate the re-arrival of the UK as a voting member of the WTO for one vital reason: they feel that globally it has begun to stall and the UK is the single biggest exponent of free trade. It always has been, and they want to welcome us back for that reason alone, if nothing else.

[Dr Fox]

My right hon. Friend is absolutely right. It is important that we can show our trading partners globally that whatever our differences in the mechanics through which we go about the task, there is an overwhelming belief in the concept of free trade in this country. As I said at the outset, the global trading environment needs someone to champion free trade at a time when many countries feel that we are rolling backwards, away from the progress that we have made. If we as a country can speak with a strong voice about the principles of free trade, citing examples from history as to why it has benefited some of the poorest people in the world, we will make a moral as well as an economic case.