Bilateral Trade: United Kingdom and Africa

Lord Chidgey Excerpts

Wednesday 11th November 2015 Lords Chamber

[Lord Chidgey (LD)]

My Lords, first, how intriguing it was to hear the comments from the noble and learned Baroness. I had not realised her connection with Dominica—a beautiful country which I once visited, and which I think is famous for its ecological tourism. Thank you for that information.

I congratulate the noble Lord, Lord Sheikh, on bringing this issue to us today. Speaking as the co-chair of the All-Party Africa Parliamentary Group, I think his speech told us an awful lot about Africa’s potential. Perhaps I may say how much I, too, look forward to the maiden speech from my colleague and noble friend Lord Oates, who I understand accompanied the noble Lord, Lord Sheikh, to Ethiopia. My noble friend brings to your Lordships’ House a wealth of experience in local and national government, having served as the deputy leader of Kingston-upon-Thames Council and, latterly, as the chief of staff of the Deputy Prime Minister in the last Parliament.

In encouraging bilateral trade between the UK and Africa, a good point of reference is the importance of good governance to investors in creating stable and reliable markets. Accountability, transparency and probity are the new watchwords in the international aid and development world, coupled with an overarching demand to gain value for money for taxpayers in results-based aid and development programmes. So far, so good, but what about encouraging UK bilateral trade at the sharp end by getting into the marketplace ready to negotiate, keen to trade and to set up joint ventures and win business? Questioning one ambassador in Africa on how UK business development was going in his country generated an interesting response. Apparently, a major UK oil company had just secured a multi-billion pound project with the possibility of subcontracts then trickling down to UK firms. In other words, the box for expanding UK trade was well and truly ticked.

In reality, of course, multinational organisations are well equipped to do their own business development and are unlikely to need embassy support, unless they are in diplomatic or political trouble. What we need to know is—I hope that the Minister can start to answer this in his reply—what guidance is given to embassy and high commission staff on assisting small to medium-size enterprises? The SMEs are the companies with the flexibility and the ideas for developing world-beating products. They are critical to our economic growth, but often without the financial resources to pursue African markets, develop products and support their customer base. Can the Minister tell me what training FCO and DfID staff are given in market assessment and business development, for example, and in establishing protocols within which they can assist private sector companies fairly and evenly?

UK-Africa bilateral aid is increasingly influenced by EU trade agreements, particularly the contentious economic partnership agreements, or EPAs. African countries are placing renewed emphasis on developing their food processing industries, creating more employment and adding greater value to their agro-food exports, often in partnership with UK and EU-based companies. A reality is emerging, however, in that in a number of agro-food sectors the rise in imports of these products is generating a disconnect between expanding urban demand and the rural African hinterlands. By removing tariff and non-tariff barriers, the EPAs have led to a massive increase in the value of EU agro-food exports to sub-Saharan Africa. Local African farmers and producers are being severely damaged by EU exports, which now account for nearly 50% of the poultry meat sector, for example, and are closing off their market opportunities. Similarly, expanding EU milk powder exports are substituting for local milk production, to the detriment of local farmers. Far greater scrutiny is needed of how trade and agricultural policies impact on the efforts of African countries and regions to promote the development of agricultural sectors.

In conclusion, will the Government pledge to recognise fully the development needs of African countries in the agro-food sector and that, within the UK’s compass, no sub-Saharan African Government will be obliged to implement trade policy measures that undermine their national agro-food sector strategies?