Central America: Trade and Investment

Lord Mountevans Excerpts

Monday 19th December 2022 Lords Chamber

[Lord Mountevans (CB)]

My Lords, I add my congratulations to the noble Baroness, Lady Hooper, on securing this long overdue and important debate. In addition to her service as trade envoy, she is a distinguished former honorary president of Canning House, as she mentioned. As the current holder of that position, it gave me, and all of us at Canning House, intense pleasure to award the Canning medal to her this summer, in recognition of her outstanding service to UK-Latin American relations and to Canning House. I also pay tribute to the noble Baronesses, Lady Coussins and Lady Anelay of St Johns, two formidable and steadfast advocates.

Central America is part of an increasingly important region of the world for business, and I for one would have been delighted if the noble Baroness had chosen to examine trade and industry opportunities for all of Latin America. As the excellent Michael Stott of the Financial Times reeled off at a Canning House event last week, addressing the whole of Latin America, the region has an economy of $5.5 trillion more than Japan; its area is 19.2 million square kilometres, almost as much as China and the US combined; it has 27% of the world’s forests, 30% of the fresh water and 25% of the arable land; it is home to some 650 million people, 81% of whom live in cities and towns, making it the most urbanised region in the globe after North America; it has 58% of the world’s lithium and 41% of its copper. Of course, Spanish, which is widely spoken in Latin America, is the world’s third-most spoken language. It is a region militarily at peace with itself and with an absence of war.

Latin America will be of increased importance because of resources—and, as usual, China sees the potential there. It contributed to 0% of global trade in the noughties, but it now exceeds Europe’s share and is approaching that of the US, which is declining. It is vital that the Government recognise the importance of central America—and, indeed, of Latin America in its entirety—and allocate resources accordingly. I am sure that we will hear good news of the progress on FTAs. I am very pleased that we have a DIT team that seems to mean business, but I very much endorse the question about the extent of the resources at their disposal. Last week, I met with Cristina Irving Turner, the department’s number two, and was suitably impressed. The region consists of friends, so can anything be done about high university fees, which is a real issue?

I am partly Norwegian, so I know that the Norwegian foreign service expects its ambassadors to be front-line salesmen for Norwegian industry and businesses. Can the Minister consider prioritising information and training for His Majesty’s ambassadors to play a role in growing our exports?

It is not only for the Government to increase their activity and ambition in the areas that earlier speakers have noted and that my successors will note; business must also engage fully with those challenges. There are opportunities for business in many areas, including pharma, infrastructure, food and drink, healthcare, energy, finance and especially fintech, agriculture, mining and education, among others. I want to impress on business the need to visit and visit and visit. A long-term commitment and approach is needed, because nothing else will work; this is not the area for quick results. When I was the lord mayor, all too often I heard the refrain, in different parts of the world, “We love you, Brits, and we love your products, but we don’t see you here often enough”. My experience of travelling internationally throughout my career is that there is enormous good will towards the UK and UK business. I also point out that the smaller countries in central America represent an ideal opportunity for SMEs, a potential that the noble Baroness, Lady Hooper, acknowledged.

Despite a reputation for inefficiency and procurement opacity, there are many ways in which international expertise can meet the needs of Latin American countries. Latin America—including, not least, some countries in central America—continues to be a region that carries risks with security and corruption, all of which can be managed with careful planning and due diligence. As someone recently said to me, it is easy to overestimate the risks and underestimate the rewards. I believe that Britain now has the strictest anti-corruption legislation in the world, and the right person at the right time might be able to suggest to a potential client that business with UK firms speaks to the highest standards and governance. If the DIT wants to build a roadshow to talk to businesses and trade associates about the opportunities in central America—or, indeed, in wider Latin America—I would be willing to join that enterprise and crusade.

In conclusion, Far Eastern business has the problem of an increasingly assertive China on its doorstep, while eastern Europe has the problem of an aggressive and vindictive Russia on its doorstep. I say to noble Lords, as well as to government, industry and business, that now is the time to engage with the huge potential of Latin America. We must get on with this urgently.