UK-Japan Comprehensive Economic Partnership Agreement

Debate between Alyn Smith and Liam Fox

Wednesday 25th November 2020 Commons Chamber

[Alyn Smith (Stirling) (SNP)]

Last time we discussed this text, I said that I would reserve my enthusiasm until we saw more of the detail. I am rather glad I did, because while it would be churlish of me not to give the Secretary of State her moment—this is an achievement, and I welcome it—it is really small beer. Any rational person recognises that in any course of action there are upsides and downsides, costs and benefits, and any course of action will have consequences. I am struck, to mangle Thomas Hardy, that this is a treaty in which no Brexiter would see anything to dislike, but no objective person anything to admire when set against the disadvantages of this course of action.

In EU stuff, in trade and in life, if we do not look at things in the round—if we do not look at the full picture—we will make poor conclusions. As we heard earlier, the consequences of giving up the benefits of the EU-Japan trade deal, to be replaced by this deal, have not been properly analysed. By the UK Government’s figures, such as they are on this, the deal will add 0.07% percent to UK GDP. That is not a small amount of money and I welcome it, but we need to look in the round at what we are losing.

I am struck, as always, by the capacity of Government Members to be giddy with excitement over the Brexit process and the potential hypothetical upsides, which, in a spirit of intellectual honesty, I accept may exist. I am proudly pro-European. A cornerstone of the SNP’s economic plans for Scotland is membership of the single market. We believe we were adequately well represented by the EU on the world stage. PGIs were mentioned earlier and there is an interesting point to be asked, and perhaps answered, about what protections the UK Government sought within the EU’s negotiation and at what point the UK disengaged from that process to foster its own deal, but that is a different argument. I accept that we have left the European Union and we need to properly analyse the costs and benefits of where we are now.

There may be some advantages to this deal. There may be some things that fit better. I have my doubts and I am not convinced that it was worth the change, but the SNP is pro-trade. As I say, we believe that the risk to our existing trade patterns is not set off properly by the benefits of this deal. Japan accounts for 1.8% of the UK’s exports of goods; the EU accounts for 46% of them. So to get the hypothetical potential upsides of the Japan deal, the UK jeopardises the real-world existing benefits of the EU single market membership and access right now. To ignore that strikes me as flatly absurd.

[Dr Fox]

I am delighted to hear that the SNP is pro-trade. Will the hon. Gentleman tell us what assessment has been made of the cost of trade to Scotland of the SNP and Scotland withdrawing from the UK single market?

[Alyn Smith]

We will tell the right hon. Gentleman that when we are bringing forward the independence prospectus. We regret that the UK has left the European Union. We regret the consequences to all our businesses, traders and exporters of the increased complexity and uncertainty that leaving the EU single market means. Our proposition on independence will be rejoining the EU market, and that has consequences for our trade flows, of course, but a proper analysis of how much Scottish trade goes through England, rather than to England, is an interesting statistic in itself. In the same way as Ireland, pre-EU membership, was very heavily dependent on the UK market, Scotland’s trade flows will change also.

There are consequences, which I do not dismiss and deny, but let us talk about this deal right now as opposed to our plans for the future. This deal right now is not worth the candle, is not worth the effort and is in no way better than what we are giving up to get it. A real-world example, where the Secretary of State and I have a degree of common ground, is cheese. She has mentioned cheese a number of times. I note that it was a particularly nice touch to give a jar of British Stilton to Japan’s Minister Motegi to celebrate this deal. I wonder: did the Secretary of State check whether he is lactose intolerant? There was an interesting statistic—I see that there are doctors in the House— from The Lancet in October 2017 that 73% of the Japanese population are lactose intolerant. Perhaps we should consider what the opportunities for our exports of cheese actually are in the real world, as opposed to Panglossian excitement about what they might be, hypothetically.

In conclusion, we welcome this treaty—just. We think it is better than the alternatives, but like any responsible Government, we are concerned about the real-world consequences and real-world costs to all our exporters right now of jeopardising our closest trading relationships with the EU, and, as we have heard, of the failure to roll over trade agreements with the wider world. It was best put by Mike Hawes, the chief executive of the Society of Motor Manufacturers and Traders, who said:

“We hope the deal can be ratified swiftly but, for both sides to benefit fully, we still need to urgently complete an ambitious and tariff-free UK-EU deal—and time is rapidly running out.”

I counsel Government Members to save their hubris until the bigger questions are answered.