Baroness Winterton of Doncaster
Main Page: Baroness Winterton of Doncaster (Labour - Life peer)Department Debates - View all Baroness Winterton of Doncaster's debates with the Department for International Trade
Wednesday 20th May 2020
(4 years, 5 months ago)
Commons ChamberRead Full debate Trade Bill 2019-21 View all Trade Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts
Madam Deputy Speaker (Dame Rosie Winterton)
I must inform the House that Mr Speaker has selected the reasoned amendment in the name of Keir Starmer. I call Secretary Elizabeth Truss to move the Second Reading. The Secretary of State is asked to speak for no more than 15 minutes.
The Secretary of State for International Trade (Elizabeth Truss)
I beg to move, That the Bill be now read a Second time.
Coronavirus is the biggest threat this country has faced in decades. All over the world we see its devastating impact. We will do whatever it takes to support United Kingdom businesses to continue trading, with our network of 350 advisers across the country and trade commissioners across the world.
This crisis highlights just how important it is to keep trade flowing and supply chains open, so that we can all have the essential supplies we need. It is free and open trade that has ensured that we have food on our table and access to vital personal protective equipment and medication. At meetings with my fellow G20 Trade Ministers, I have continually called for a united global response, tariff cuts on key supplies and reform of the World Trade Organisation. Although it is unfortunate that some countries have resorted to protectionism, many have sought to liberalise in the face of this crisis. In particular, I have been working with colleagues such as Australia, New Zealand and Singapore to highlight the importance of keeping trade flowing.
Free trade and resilient supply chains will be crucial to the global economic recovery as the crisis passes. Time after time, history has shown us that free trade makes us more prosperous, while protectionism results only in poverty, especially for the worst off. Britain has a proud history as a global leader and advocate of free trade. The bold and principled decision of Sir Robert Peel to take on the power of the wealthy producers and repeal the corn laws in 1846 ushered in an unprecedented era of free trade that saw ordinary people in Britain benefit from more varied and cheaper food, helping to grow our cities and power forward the world’s first industrial revolution.
I see a real opportunity again for industrial areas across Britain as we become an independent trading nation. By cutting tariffs and reducing export red tape, our great British businesses will be able to sell more goods around the world. British steel, ceramics and textiles are some of the world’s best, but all too often they are subject to high tariffs and barriers. Those industries are already looking forward to the opportunities that future trade deals will bring.
The US imposes tariffs of 25% on steel; removing them would boost our domestic industries. As my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft) knows, that will particularly benefit areas such as Yorkshire and the Humber, which account for more than a third of our iron and steel exports to the United States. Indeed, just this week UK Steel said:
“A new UK/US Free Trade Agreement would provide a significant boost to our trade to this high-value market, create a global-competitive advantage for UK steel producers, and open up valuable new market opportunities.”
Our farmers and food producers stand to gain from a trade deal with the US. The US is the world’s second largest importer of lamb, but current restrictions mean that British producers are kept out. We can also grow, for example, our malting barley exports from Scotland and the east of England.
The tech trade will benefit from a US free trade agreement through cutting-edge provisions on digital and data. Telecoms and tech have more than doubled in the past decade, and an ambitious FTA could see those exports grow further.
While free trade provides opportunities, protectionism would harm farmers, tech entrepreneurs and steel manufacturers. We have already seen this before: in 1930, the Smoot-Hawley Act raised US tariffs on more than 20,000 imported goods, resulting in retaliation from other nations and the deepening and prolonging of the depression. As President Reagan said in 1985:
“Protectionism almost always ends up making the protected industry weaker and less able to compete against foreign imports…Instead of protectionism, we should call it destructionism. It destroys jobs, weakens our industries, harms exports, costs billions of dollars to consumers, and damages our overall economy.”
We have a golden opportunity to make sure that our recovery is export led and high value—a recovery that will see our industrial heartlands create more high-quality and high-paying jobs across all sectors. Free trade does not just benefit us here in Britain; it benefits the world. Since the end of the cold war, free trade has lifted a billion people out of extreme poverty. For want of a better word, free trade is good. It is those benefits that underpin our Government’s approach: free and fair trade fit for the modern world.
Let me turn to the contents of the Bill. We can have fair trade only if it is free trade. The Bill will embed market access for British companies by enabling the UK to join the WTO’s Government procurement agreement as an independent member. This will provide businesses with continued access to the extraordinary opportunities of the global procurement market, worth some £1.3 trillion a year. The GPA is an agreement between 20 parties that mutually opens up Government procurement. We have already seen in the UK the way that competition drives up quality while keeping prices low. The GPA keeps suppliers competitive and provides them with opportunities overseas. It is a driver of growth, not a threat to our economy. The idea that we can, or even should, do everything domestically is not desirable or practical in this increasingly interconnected world. Instead, we should be making sure that we have resilient supply chains through a more diverse range of partners. We will be an international champion for free and fair competition in the coming months and years through our discussions at the WTO, the G20 and bilaterally. We will urge other countries not to heed that false, but enticing, call for protectionism.
Let me be clear to the House: the GPA sets out rules for how public procurement covered by the agreement is carried out. As an independent member, we are free to decide what procurement is covered under the agreement. The UK’s GPA coverage does not and will not apply to the procurement of UK health services. Our NHS is not on the table.
We are also committed to continuing our trade with existing partners that have agreements through the EU, such as South Korea and Chile. To date, we have signed 20 such trade agreements representing 48 countries, and others are still under negotiation. This accounts for £110 billion of UK trade in 2018, which represents 74% of continuity trade. People said that we would not be able to roll over these agreements—well, they were wrong, and we will be signing more in the coming months. This work is part of securing the Government’s aim to have 80% of UK trade covered by free trade agreements in the next three years.
We are also looking to new partners. Negotiations with the US and Japan are kicking off. We are prioritising signing FTAs with Australia and New Zealand and accession to the comprehensive and progressive agreement for trans-Pacific partnership, otherwise known as the CPTPP. With the UK global tariff now published, there will be an increased incentive for other countries to come to the table to maintain or improve upon their preferential terms and conditions. Fundamentally, free trade is humanitarian and we will maintain preferential margins for developing countries, helping businesses lift millions out of poverty. As a Government, we have committed to going further than the EU has in terms of trade for development, and we are looking at reducing or removing tariffs where the UK does not produce goods and getting rid of cliff edges in current tariff schedules.
That brings me to the second part of our approach: fair trade. The Bill will help establish the independent trade remedies authority, which will help protect British businesses against injury caused by unfair trading practices such as dumping or subsidy, or unforeseen import surges. I tell the House that while free trade has no stauncher friend than this Government, unfair trading practices that hold back British businesses will have no worse enemy. We will fight against state-owned enterprises that use public money to subsidise their goods and Governments who support the lobbying of these under-priced products into the UK market.
Excellent UK industries such as ceramics and steel—represented ably by my hon. Friends the Members for Stoke-on-Trent Central (Jo Gideon), for Stoke-on-Trent North (Jonathan Gullis), for Stoke-on-Trent South (Jack Brereton), for Redcar (Jacob Young) and for Scunthorpe—should not face unfair trade. The TRA will be responsible for investigating claims of unfair trading practices based on the evidence available. It will then make impartial representations to Ministers.
The TRA’s impartiality is vital. Decisions on trade remedies cases can have a material impact on business and financial markets. This Bill will allow us to create an independent body to carry out objective investigations in which businesses can have full confidence. In developing our own trade policy for the first time in almost 50 years, we will use technology to ensure that our trade agreements are fit for the modern world. Therefore, this Bill will give the Government powers to collect and share the trade data that will help our independent trade policy. This will make it easier for our trade policy to reflect the interests of businesses across the UK.
Let me assure the House that this Bill is a continuity Bill. It cannot be used to implement any trade agreement between the UK and the EU itself, nor can it be used to implement an agreement with a country that did not have a trade agreement with the EU before exit day, such as the United States of America. The Bill can be used only to transition the 40 free trade agreements that the EU had signed with third countries by exit day, and these powers are subject to a five-year sunset clause to ensure that we can maintain the operability of transitioned agreements beyond the end of the transition period. Any extension of this five-year period will require explicit consent of both this House and the other place.
We face a period of unprecedented economic challenge. It is vital that we do not just maintain the current global trading system, but make it better. That means diversifying our trade and supporting those businesses that export. Exports, be they software or steel, cars or ceramics, barley or beef, will underpin our recovery. This Bill will ensure continued access to existing markets by letting us implement trade agreements with partner countries that previously applied under the EU. It will secure continued access for UK businesses to the £1.3 trillion global public procurement market. It establishes the independent body in the Trade Remedies Authority to give our great British businesses the protection they need from unfair trade practices. Trade will be fair as well as free. By adopting a cutting-edge digital first approach, we will be able to give businesses the best possible support.
As we recover from the economic shock of the coronavirus crisis, providing certainty and predictability in our trading arrangements will be vital to securing the interests of businesses and consumers. We will unleash the potential and level up every region and nation of our United Kingdom. Now is the time for this House to speak out against protectionism. It is time for us to embrace the opportunities that free trade and an export-led recovery will bring. I commend this Bill to the House.
Madam Deputy Speaker (Dame Rosie Winterton)
I now call the shadow Secretary of State, Emily Thornberry, to move her reasoned amendment, and she has 10 minutes in which to speak.
Dr Liam Fox (North Somerset) (Con)
I will not go over the detailed points in relation to the Bill so eloquently made by my right hon. Friend the Secretary of State—I have to say that I recognised some of the phraseology in her arguments—but I want to deal with the context in which it is being brought forward.
During the long gestation of the Bill, a lot has changed. Not only have we had the covid crisis, which will have a fundamental effect on the global economy, but in 2019 we saw the culmination of many of the predictions that were made by the Department for International Trade. We predicted that we would see first a slowdown in the growth of global trade and then potentially a contraction of global trade itself. We watched through 2019 the WTO make predictions on global trade growth, down from 2.8% to 2.2% and 1.4%. It finally came in at 0.7%. The key element was that it contracted in Q4, which has generally in history presaged a downturn in the global economy.
That happened for a number of reasons. The US-China trade dispute had a general effect on global trade, and in particular we saw the shortening of global supply chains, as people sought to onshore and shorten global supply chains by minimising the import of intermediate goods. We saw the inevitable consequence of the trend over the decade of the G20 countries applying more and more non-tariff barriers to trade—quadrupling them in the first half of this decade—and they all matter. A bit of consumer protection here, a bit of environmental protection there and a bit of producer protection here are all justifiable in themselves, but they all add up. They have all resulted in a silting up of the global trading system, and the skies over the global trading system are now darkening with those chickens coming home to roost.
Why does it matter? It matters because a free and open trading system has been our route to the reduction in global poverty, with more than 1 billion people taken out of abject poverty in just one generation. There is another reason it matters, which is that access to prosperity, political stability and security are part of the same continuum. It is unthinkable that the wealthiest countries in the world should pull up the ladder behind us, stopping developing countries gaining access to the same levels of prosperity. It is absurd to believe that we can do that without seeing disruption in global security. If we deny people access to prosperity, do not be surprised if we see more mass migration and more radicalisation. We need to understand that we cannot separate the concepts. Those who wish to introduce protectionism into the global economy will have to bear the consequences of the actions they are currently embarked upon.
I want to see us, through this Bill and beyond, doing more on global trade liberalisation. Going back to where we were pre-covid will not be enough, because global trade was contracting. I was a proud Brexiteer, but I have never been a little Englander. My objection to the European Union in the era of globalisation was not the absurd notion that it was foreign, but that it was not foreign enough. It did not have global aspirations that were in tune with what we as a country wanted to see. Post covid, all the challenges we face together will be bigger, and we will have to work with all those who believe in free trade to put them right.
The UK exports 30% of our GDP. Germany exports 48% of its GDP, and OECD data shows that the trade slowdown has hit the European Union hardest of all in the global economy, with exports from the EU contracting by 1.8% in the third quarter of 2019, even before global trade itself contracted. That is the scale of the challenge that we face.
The Government’s proposed tariff regime reform is to be hugely welcomed, although it could be even more liberal yet. The new FTAs and the roll-over agreements allowed through the Bill are also to be welcomed. Those who put obstacles, political and otherwise, in the way of both the roll-over agreements and the new FTAs through largely pointless and irrelevant arguments need to understand the consequences to the wider global economy, as well as to our domestic prosperity, of doing so.
My right hon. Friend was right when she talked about the bigger picture and how we must champion World Trade Organisation reform. Without it, we will be unable to maintain the rules-based system, which is already substantially under threat. The alternative to a rules-based system is the survival of the strongest, and that will have the biggest impact on the poorest countries. This is an area where we can give a lead as a country not only economically, but morally.
Madam Deputy Speaker (Dame Rosie Winterton)
I call Stewart Hosie, who has seven minutes.
Stewart Hosie (Dundee East) (SNP) [V]
May I start by agreeing with the Secretary of State that it is absolutely vital that we keep trade open and recognise the importance of the supply chain, and that it is absolutely essential that we stand against protectionism? We need to do that, because right now there are three main threats to trade. The first is self-evidently from the covid crisis, which the World Trade Organisation has suggested might cause a fall in global trade of something in the order of 13% to 32%. That is a substantial reduction, no matter where on the scale one looks. The second is the impact of Brexit. Assessments suggest that the UK could lose a substantial chunk of its global trade. The third is the more systemic problem that the right hon. Member for North Somerset (Dr Fox), the ex-Trade Secretary, was speaking about, which is the continued implementation of new and the continuation of existing trade restriction measures, with tariffs valuing somewhere around $1.6 trillion in force.
I am not confident that those problems will be resolved any time soon, not least because there is as yet no cure for coronavirus and restrictions of one sort or another may well remain in force for some considerable time, because of the highly publicised lack of progress on the Brexit negotiations, and also, sadly, because of the absence of a functioning World Trade Organisation appellate body. This Trade Bill does not address any of those matters, other than perhaps at the margins, by trying to roll over and maintain the trade the UK has with third countries via membership of the EU and thereby minimise the losses from Brexit.
The Bill does do a number of other things, as the Secretary of State set out. It creates procurement obligations arising from membership of the GPA—the agreement on Government procurement; it creates the Trade Remedies Authority; and it gives powers to Her Majesty’s Revenue and Customs to collect and share data. However, it is not without its problems. Let me deal with the powers relating to the devolved Administrations first. The previous Trade Bill, which was under consideration in the previous Parliament, contained provision for regulation-making powers to be available to the UK Government within areas of devolved competence. That Bill also contained a provision that prohibited devolved Administrations from using powers to modify retained direct EU legislation or anything that was retained EU law by virtue of section 4 of the European Union (Withdrawal) 2018 Act in ways that would be inconsistent with any modifications made by the UK Government, even in devolved areas. As a result, the Scottish Government could not consent to that, and that view was shared by the Scottish Parliament Finance and Constitution Committee.
That Trade Bill did not complete its passage and fell, and the good news is that those provisions have been removed from this reintroduced Trade Bill. However, there remains no statutory obligation for the UK Government to consult or seek the consent of Scottish Ministers before exercising the powers they have in devolved areas. However, during the partial passage of the previous Trade Bill, the UK Government made a commitment to avoid using the powers in the Bill in devolved areas without consulting and ideally obtaining the consent of Scottish Ministers. The then Minister of State at the Department for International Trade, the right hon. Member for Bournemouth West (Conor Burns), subsequently restated those commitments in his letter to Ivan McKee, the Scottish Trade Minister, on 18 March, and I hope that the Minister we hear from today will restate these non-legislative commitments.
The Bill is not without its problems, and they do not relate simply to the devolved Administrations. It allows the UK Government to modify retained direct principal EU law, and it appears to me that there are no legislative limits on such modifications. The second problem is the description of an “international trade agreement” in clause 2(2)(b), which states that it may be
“an international agreement that mainly relates to trade, other than a free trade agreement.”
As we know, modern agreements are as much about regulation, standards, conformance, dispute resolution or food safety as they are about quotas and tariffs. Many people will uncomfortable that Ministers can modify existing agreements in the way in which this Bill permits, particularly without scrutiny and consent.
That leads me to the fundamental problem with the Bill. The absence of parliamentary scrutiny and a parliamentary vote on significant changes or modifications, or, indeed, in the future, on new trade deals as may be envisaged by the Government, is a huge problem. Modern democracies need to have full scrutiny of trade agreements, from the scope of the negotiating mandate right through to implementation. That is absent from this Bill, as is any provision for scrutiny other than through the voluntary scrutiny proposed by the Government in the Command Paper published in the previous Parliament, to which I will return briefly at the end of my speech.
These issues also highlight the absence of any formal input into trade deals or significant modification of existing ones by the devolved Administrations—a problem replicated in the membership of the Trade Remedies Authority, where no formal ability exists for the devolved Administrations to propose or nominate a member with expertise in regionally or nationally significant trade.
I shall turn briefly to the Command Paper that was published in 2019 and covered the previous Trade Bill. Does it still apply? Does the commitment to publishing our negotiating objectives and scoping assessments still exist? Even if it does, does the Minister recognise that that still does not give Parliament or the devolved Administrations any role in approving them? Is it still the intention of the UK Government to provide sensitive information to a scrutiny Committee? Would that be the Select Committee on International Trade, which is ably chaired by my hon. Friend the Member for Na h-Eileanan an Iar (Angus Brendan MacNeil)? If it is, will any papers provided be publishable, or will they be restricted? If they are restricted, that will still leave Members of Parliament, exporting businesses and other interested third parties none the wiser about the Government’s real intentions. I am conscious of the limited time, Madam Deputy Speaker, so let me end simply by saying—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. I ask the hon. Gentleman to bring his remarks to a close. I thank him for his contribution, but we must move on. I am now introducing a time limit of five minutes, and I advise hon. Members who are speaking virtually to have a timing device visible.
Barry Gardiner (Brent North) (Lab)
The Trade Bill is a bad Bill. It is bad because it fails to establish a proper framework whereby Parliament can scrutinise, ratify and implement all future international trade treaties; because it creates one of the weakest trade remedy authorities in the world, and because it pretends that it is necessary to roll over our existing agreements with third countries through the EU. So necessary is the measure that the Minister will have great difficulty when summing up in explaining how the Government have managed to roll over the majority of them before the Bill has passed into law. This is legislative prestidigitation of the highest order. The Government say that they need the Bill to do what they proudly boast they have already succeeded in doing without it. The truth is that the Bill is about the Government’s abrogating to themselves all future power in relation to trade agreements, freed from the inconvenient scrutiny of Parliament.
The procedure for ratifying international agreements is set out in the Constitutional Reform and Governance Act 2010—CRAGA. It stipulates that any treaty need only be laid before Parliament for 21 sitting days. If there is no vote against it during that period, it passes into law. But the Government decide Parliament’s business and can simply arrange that no vote takes place. When CRAGA was introduced, a huge number of democratic scrutiny processes were in place through the European Union. There was the European Council’s negotiation mandate and formal consultation procedures. The Committee on International Trade—the INTA Committee —scrutinised treaties before passing them to the European Parliament to vote on. Treaties then came to the European Scrutiny Committee in the Commons for further examination before the CRAGA process ratified them. Under the Bill, all that is left is the rubber stamp of CRAGA. All other layers are gone. The Bill should try to replace those layers. It cannot be right that there is no democratic oversight whatsoever of trade agreements.
Members of Parliament may disagree about whether an agreement will benefit jobs or adequately protect standards, but they should have at least the right to debate those matters and hold the Government to account. The Bill denies us that right. This is not Parliament taking back control, but Government snatching it from Parliament. That is why I believe the Bill is dangerous.
Let me remind Conservative Members of what they claimed to be fighting for at the last general election. They said that sovereignty meant not accepting the rulings of supranational courts such as the European Court of Justice. Do they therefore agree with us that the use of investor-state dispute settlement mechanisms in future trade agreements should be ruled out in any form? They give higher rights to foreign investors than to our own domestic companies, allowing them to sue our Government in private courts for policy decisions that have an impact on their potential profits. So much for gaining freedom from a supranational court.
Conservative Members said that Britain had to be free to chart its own future in the world. Do they therefore agree that negative lists of services should be banned? It is impossible to specify in a list a service that has not yet been invented. The negative list process would stop the UK Government making a decision about how such services should be provided in future. So much for making our own way in the world.
Conservative Members said that they would safeguard our domestic environmental protections, food safety regulations and animal welfare laws, but simply keeping our regulations for our farmers here does not protect them in a free trade agreement. Allowing the importation of goods produced elsewhere to lower standards will undermine our producers and lead to a race to the bottom—so much for safeguarding our food and welfare standards.
The Government said they would not sell off the NHS, and of course they cannot. The NHS is not an entity that can be sold, but free trade agreements can contain an innocuous-sounding provision about the restructuring of pharmaceutical pricing models. That is the way to undermine the health service—by downgrading our bulk purchasing power against big pharma companies. So much for the NHS being “safe” in their hands.
Finally, does it follow that if this Bill is enacted, by necessity we will end up with all these measures? No, it does not. It does mean, however, that if they exist in any proposed FDA, Parliament will have no means of stopping that. This debate is about more than trade; it is about the balance of power between Parliament and the Executive. It is about the sovereignty of Parliament—something that every Tory who will vote for this obnoxious Bill swore in their manifesto to defend.
Madam Deputy Speaker (Dame Rosie Winterton)
I am afraid we cannot hear Richard Graham at the moment, so I will now call Robert Courts.
Robert Courts (Witney) (Con) [V]
It is an honour to speak in this debate and to participate in the detail of the Bill with my colleagues from the International Trade Committee. I am pleased that so many of them are taking part in this debate. Free and open trade has created the world in which we live—a world that is open, prosperous, and inventive. One of the greatest prizes to be seized by any Government is the ability to carry out an independent trade policy, which is what we are doing today.
Why does trade matter in the first place? It is pretty straightforward. Exporters and their supply chains are responsible for millions of jobs in the UK. Countries whose economies are open have higher productivity, because of competitive pressures and greater specialisation. Analysis by the Department for International Trade suggests that businesses that export goods are around 21% more productive than their non-exporting counterparts. Those exporters provide a larger proportion of UK manufacturing and labour productivity growth.
However, we can do so much better that we currently do. That same survey data suggests that 250,000 to 350,000 UK businesses have tradeable goods and services, but do not currently trade internationally. When we couple that with the undoubted, unquestionable benefit of the UK brand, which has fans from North America to China and everywhere in between, this is an opportunity for each and every one of us throughout the country. When we consider the potential benefits of a US trade deal alone, and the possibility of bilateral trade increasing by more than £15 billion, increasing wages by £1.8 billion and benefiting every area of the country, we see the extraordinary prize that lies before us. All that is before we even start to consider the exponential growth that is likely to come from the developing world in the next 10 to 20 years.
It is foolish to see trade as some game of numbers that is reduced to statistics. People have traded together since one cave dweller traded food for tools in the dim and distant past, and what trade starts, friendships continue. Whether it was Bastiat, or someone else, who said that when goods do not trek across borders, soldiers will, the essence of that remains true, as is its flipside. Trade helps people to understand each other and get to know something of the way that other societies work. That must be delivered through an independent trade policy—one that applies our priorities to our country, and does not let somebody else’s priorities be applied for us.
Those who say that the Bill does not make provision for high standards must know that this is not the place for that; this Bill sets the framework for the conversations that are to come. In any event, the Government have been crystal clear about our ambitions for the future. As the Prime Minister said in his speech on 3 February,
“we will not accept any diminution in food hygiene or animal welfare standards… We are not leaving the EU to undermine European standards. We will not engage in any kind of dumping, whether commercial, social or environmental.”
However, having high standards is not the same thing as letting others set them for us, or seeking to control the way that others regulate their industries. If, in any event, we want to set trade defences, barriers or tariffs, we will need the Trade Remedies Authority that is set out in the Bill.
It is difficult to avoid the conclusion that those who object to the Bill as it stands are those who object to free trade in general and wish to cling to the old-fashioned protectionist agenda that was defeated in this country more than 100 years ago. Protectionism will always have an appeal for those who wish to protect vested interests, but we should be clear: history makes it clear that protectionism leaves everybody the poorer, and the poorest worse of all. That is all the clearer when we look at the impact of the current crisis. Exporters and their supply chains are responsible for millions of jobs in the UK. With unemployment rising during the crisis, job creation with exporters afterwards will be more important than ever, and we must have the flexibility to make our own measures for our own markets. Only by having that flexibility can we ensure that Britain’s economy is successfully refreshed.
As we look to ensure that we have what we need to protect us for the future—PPE, medicines and other things —it is natural to wish to turn inwards, to protect we have and to keep more for ourselves, and to ensure that we in our island can look after ourselves. In some ways, that is an understandable impulse, but not in the area of trade. Not only is it morally wrong to retreat behind a protectionist barrier wall by which the developing world is excluded—we would pay the consequences for that behaviour in any event—but it is against our own interests. We cannot make everything ourselves and we cannot make everything well. We should concentrate on what we are good at—high-tech industries, for example—and look elsewhere at where others can better help us and we can help them, too.
It is keeping open global trade routes that has enabled us to be fed, to buy PPE and to secure essential medication from all across the globe. Free trade is not just an economic opportunity, but the openness of the system itself provides a vital defence. We must seek to diversify our supply chains, because in that way we can improve our resilience to withstand future challenges and ensure that we reduce our reliance on countries—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. I thank the hon. Gentleman for his speech, but we have to move on now to Paul Girvan—[Interruption.] We will come back to Paul Girvan, and will move on to Marco Longhi.
Marco Longhi (Dudley North) (Con) [V]
The Trade Bill we are discussing today is a framework that allows us to continue to trade as a nation state with those countries who already have a trade agreement with the EU. It enables UK service providers to seek out business in Government procurement markets worth £1.3 trillion, and reshores from the EU those protections available under WTO rules to support British business against unfair trading activities under the new trade remedies authority.
Why is that important? It means that we will harpoon yet again the ill cited arguments that we will crash out and fall off a cliff edge through Brexit. It means that we can seek out new business, and it means that we can finally take effective action ourselves against rogue nations who do not respect international trading conventions. Let us remind ourselves of the EU’s impotence when China dumped its excess steel on our markets, and the jobs it cost us here in the UK.
It is an undisputed fact that open markets and free trade generate wealth and our new-found and hard-won ability to seek out new markets will grow our economy. Covid-19 has brought about a global tendency towards protectionism, which we know has the opposite effect. We must not be drawn into this trap at any cost, as we shall be poorer for it. However, what covid-19 has shown is that for all their rhetoric, the EU’s institutions fail to respond effectively, if at all, and its constituent members immediately behaved as a collection of nation states. They offered a shallow apology to the Italian people for leaving them to their own devices while protecting their own. I must ask, was that not entirely predictable? That begs the question of how, as a nation at this historic junction, we consider the strategic implications of a future crisis. Should we be more self-reliant in key areas such as energy, food and medicines? Many large corporates are now reshoring as they understand the total cost of outsourced activities, including problems with quality control, the cost of unreliable supply chains and the carbon footprint of products, just to name a few. That is why I was delighted to hear about our investment to produce 70 million masks in the UK and create around 450 jobs at the same time. It is about taking a risk-based approach and understanding the total cost-benefit arguments of decisions that we take in the key areas that affect our national resilience.
Globalisation is here to stay. As we harness the great opportunities presented to us by Brexit and FTAs, our biggest challenge is how we do so. The area that I represent in Dudley and the many areas that my new colleagues represent have not always benefited. Globalisation has seen benefits, but also a race to the bottom with a low-wage economy in traditional manufacturing and the loss of jobs in the sector. Buying a pair of boots for a few pounds less is not a huge benefit if there is not a job to go to.
Analysis shows that there are between 250,000 and 350,000 businesses that currently do not export but could. My plea is that we target those businesses, with a special focus on those in the midlands, with determination, enthusiasm and strategic focus, and at real pace, so that we can add value and bring new jobs to these areas while we also minimise the devastating impact of covid-19 on local economies and people’s lives.
Paul Girvan (South Antrim) (DUP) [V]
It is a privilege to follow the hon. Member for Dudley North (Marco Longhi) and to have an opportunity to talk about the Bill, which is a road map to the UK and Northern Ireland’s future trading relationship with the rest of the world. It is important that we uphold and protect the good standards that we have set.
The Bill is focused on five main areas: procurement and the GPA; trade agreements; the formation of a trade remedies authority; information collecting, mainly in respect of HMRC; and data sharing. I want to focus mainly on what will affect Northern Ireland, which has a large proportion of exports, with 17% of all Northern Ireland sales going out of the country—sales worth £6.2 billion in 2018-19.
Two of our main sectors are machinery and transport: machinery makes up £3.2 billion of our total, and food, agriculture and the export of live animals make up £1.5 billion. I agree with the comments by the hon. Member for Montgomeryshire (Craig Williams) about agri-food, which we have to protect. We must ensure that we maintain the standards that have been fought for and achieved, and that we implement them as much as we can in any future agreements. We have a fantastic farming and agri-food industry in Northern Ireland. We have fought hard to ensure that our industry is sustainable, and we want to ensure that it is there for the future.
The pharmaceutical industry plays a big role in Northern Ireland. In my constituency we have Randox, and elsewhere in Northern Ireland we have Almac and Norbrook Laboratories. All are working hard during this covid-19 crisis. They have an offer to the rest of the world that we have to maintain.
We have a great wealth of talent in our tech industry. It was recently announced that 65 jobs are to be created in Northern Ireland at the American firm Cygilant. We have to ensure that we have opportunities to uphold. I am a free marketeer, but I do believe that we have to protect those industries that are currently struggling and make sure that they have every opportunity to be included in trade deals.
The previous Bill fell in 2019 as a result of the Westminster election. As we did not have a Northern Ireland Assembly in place at that stage, we had no input from the Northern Ireland Executive in relation to what should or should not be included in that Bill. We have an opportunity to ensure that all areas of the United Kingdom are represented on the new body, the TRA, that will be set up. All regions of the United Kingdom and the devolved areas should be represented on it. I am asking for an assurance that when deals are put forward, they apply in full to Northern Ireland, are fully accessible to businesses and trade from Northern Ireland and will be for the benefit of all. This Bill is an opportunity for us to take back trade certainty and to take back control within our own Parliament and we will support it. I thank you, Madam Deputy Speaker, for giving me the opportunity to speak in this debate this afternoon.
Richard Graham (Gloucester) (Con) [V]
I hope you can hear me better this time, Madam Deputy Speaker. I am grateful for the opportunity to join this debate.
As our debate across the country widens gradually from how to protect our citizens’ health to how to protect their jobs, this Trade Bill is important. Some 30% of our GDP comes directly from our exports, and they in turn generate many of the jobs of all of our constituents. This is especially true in high-value manufacturing and engineering, cyber and services, in all of which there are some great examples clustered around my constituency of Gloucester.
This Bill, which provides the infrastructure for our own trading agreements with the Government procurement and the Trade Remedies Agency, is part of our plan to put our exporters in a position not just to recover but to grow again. Alongside the talks with the EU being handled through the Cabinet Office, and those by the Department of International Trade with the US, Australasia and the Trans-Pacific Partnership, this Bill highlights some of the Government’s strategy to take this forward.
I support all the goals mentioned in the Bill, but at the same time we should be honest about the risks. Global trade is currently in decline. Nationalism and protectionism are on the rise. The backdrop is not as benign as it was for an overall expansion of our trade, growth of exports and expansion of jobs in exporting businesses. We clearly do need to finish the agreements with our allies, such as Singapore, Canada and Japan, with which agreements did already exist. Trying to negotiate separate agreements with separate teams simultaneously with both the US and the EU is high-wire trade diplomacy. I wish our ministerial teams and all the negotiators all good fortune in taking these forward successfully. I believe that many of these things will go down to the wire, and our teams should play tough. They should stick with the game, and we need their success.
It is also worth highlighting the opportunities from the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, which is an important accession opportunity rather than an FTA. Even though there is some overlap, we should not forget the importance of the 10 members of the Association of Southeast Asian Nations. TPP is not a complete substitute for continuing to grow our business with ASEAN in terms both of exports and bilateral investment. The way in which investment from the Philippines, to pick one small example, has turned around the fortunes of the Glaswegian Scottish whisky blender Whyte and Mackay is a strong case in point when it comes to the advantages of inward investment.
May I encourage the Secretary of State, the Minister who in his place and their teams to focus strongly, as we go forward, on the Continent of Asia both for greater market access through economic dialogues, as well as on FTAs and the TPP, recognising that most of its agricultural commodities and handicrafts are completely complementary to rather than competitive with our own output. Our services, for example those providing health insurance for millions across south-east Asia, are hugely beneficial for those countries as well as for our businesses. Ultimately, that is why this Bill is so important: it is an opportunity not only for us but for our trading partners, and we are right to strongly make the case as to why free trade does matter across the world.
Madam Deputy Speaker (Dame Rosie Winterton)
I shall now suspend the House until 4.24 pm.