UK Trade

Lord Howarth of Newport Excerpts

Wednesday 23rd January 2013 Lords Chamber

[Lord Popat]

The noble Lord asks a very interesting question that covers a wide range of subjects. Let me start with emerging markets. The world has changed; we are repositioning ourselves again and emerging markets are key for us—we give them a special priority. Within those emerging markets are the BRIC countries. I know the noble Lord’s interest and I pay tribute to his work for UKIBC. I was in India two weeks ago with UKTI, our excellent high commissioner in Delhi and a UKIBC colleague of the noble Lord’s. They work with India to make sure that we double our exports there by working with large numbers of corporations both in the UK and in India.

To answer the third part of the noble Lord’s question, insurance is being looked at and reviewed. I agree that we need to make a number of schemes available to our exporters, and it is up to UKTI—as it is well aware—to make the people who export aware of it, too.

[Lord Howarth of Newport]

I add my welcome to the noble Lord. My Lords, the IMF estimates that fiscal tightening in advanced economies will be 1% in 2013, compared to 0.75% in 2012. The squeeze will be particularly severe in our main export market, the European Union. Against this background of external weakness, how can it make sense for the Government to use fiscal policy to weaken demand in our domestic market as well? Who are our producers to sell to?

[Lord Popat]

My Lords, we are in an open economy and that is why the Government have come forward with a plan for growth. We want to make sure that we create one of the most competitive tax systems in the G20; we want to make sure that we are open for business and that we welcome inward investment into the UK, and so we will be competitive. The only way to grow is to encourage new businesses, to help existing businesses to grow and to create a climate in which our businesses can do well. However, we cannot help internationally. We are positioned in such a way that we have to work and live in an open economy.