Brexit: Trade Agreements

Baroness Fairhead Excerpts

Wednesday 17th January 2018 Lords Chamber

[Lord Dykes]

To ask Her Majesty’s Government with how many countries with existing trade agreements registered with the European Union they intend to open trade talks from April 2019; and how long they expect the process of concluding those new trade agreements to take.

[The Minister of State, Department for International Trade (Baroness Fairhead) (Con)]

Through membership of the EU, the UK is currently party to around 40 trade agreements with more than 70 countries. Our priority is to secure the continuity of these existing trade arrangements as we leave the EU in order to provide certainty for businesses, consumers and investors. That is the basis of our current discussions. After leaving the EU, we will consider how we might best further develop our existing trading relationships, including with developing countries.

[Lord Dykes (CB)]

I think that Answer is both rash and brave, so I thank the Minister for it. Will she bear in mind that the total absurdity—I use those words deliberately—of the programme that is planned by the Government means that, really, the programme should start on 1 April 2019—in the morning, of course?

[Baroness Fairhead]

We have made it clear in the Trade Bill that, as I said, our focus is on continuity to make sure there is security and no cliff edge. We are actively working towards that. I have to respect confidentiality and do not want to pre-empt the outcome, but the process has been very positive. We have had discussions with more than 70 countries and have already moved to the technical stage with some countries. On future trade agreements, as the noble Lord will know, under the terms of the EU we are not allowed to negotiate new free trade agreements. We are, however, able to start discussions, so we have 14 working groups and high-level dialogues looking at a range of ways in which we can develop our trading relationships for when we are able to start negotiating and agreeing future agreements.

[Lord Forsyth of Drumlean (Con)]

My Lords, can my noble friend explain to the House why the EU has failed to reach trade agreements with our major markets, such as India, China, the United States and Australia?

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[Baroness Fairhead]

I am focused on the continuity of the ones that we have and on building working relationships with the countries that we can have trading relationships with in the future. The EU now has a number of trading relationships through both traditional free trade agreements and EPAs, where the focus is much more on development. We in the UK have long been supporters of a very strong and open pro-trade agenda.

[Lord Tomlinson (Lab)]

My Lords, if the Minister has set her face so clearly on continuity of purpose in this regard, why are the Government so content to rip up so many of the agreements that serve us well at present?

[Baroness Fairhead]

The referendum decision was to leave the EU, and as we leave the EU, we will no longer be party to those agreements. We have to get that continuity so that we have security for our businesses.

[Baroness Smith of Newnham (LD)]

My Lords, can the noble Baroness tell us how many of the 40 free trade agreements she mentioned, with 70 countries, include either most favoured nation clauses or national treatment clauses—that is, non-discrimination clauses? What assessment have the Government made of that for the process of our negotiations, and do they think there will be an impact on our ability to have a Canada triple-plus agreement?

[Baroness Fairhead]

The most favoured nation clauses are in a number of those agreements, although I could not give the noble Baroness the exact number. Clearly that is one of the issues that needs to be resolved as we move forward, because most favoured nation provisions clearly need to apply where they exist. If the noble Baroness would like the number to be assessed, I will ask my officials to write.

[Lord Pearson of Rannoch (UKIP)]

My Lords, are the Government aware of the Civitas research which shows that Brussels has managed to reach free trade agreements with countries whose combined GDP amounts only to some $7 trillion, whereas four small economies—Chile, Korea, Singapore and Switzerland, which have much smaller economies than ours—have averaged FTAs with countries whose combined GDP is $42 trillion, six times that of the EU? Does this not show that the EU’s famous clout in this area is yet another fraud and that we would be far better making free trade agreements on our own?

[Baroness Fairhead]

My Lords, the UK is a very strong believer in free trade, within rules. Trade means trade within rules. As I said, we will be pursuing our free trade policy and will try to take advantage of the opportunities that exist today. In my department, we are focused on building our export sales, which we can do in the current environment and through our free trade agreements.

[Baroness Hooper (Con)]

My Lords, can my noble friend tell us whether it is intended to replace the current trade agreement between the EU and central America with separate trade agreements with each of the central American countries or to continue on the path of the EU agreement?

[Baroness Fairhead]

The initial plan is to make sure that we have as much continuity as possible. We are trying to replicate the effects of that as much as possible. As I said, we now have working groups looking at a variety of options and approaches to free trade agreements. We will progress those when we are able to do so, after we leave the EU.