Trade and Investment

Baroness Hooper Excerpts

Wednesday 9th February 2011 Lords Chamber

[Lord Green of Hurstpierpoint]

I welcome my noble friend Lord Northbrook’s support for what is proposed in respect of the ECGD and the commitment that the Government have given on Doha. The Government are clear that they want the most competitive corporate tax environment of any of our major competitor countries. As the noble Lord is aware, the headline rate of corporation tax is coming down by one percentage point between now and 2014. When it reaches its final level in 2014, it will be the most competitive rate among the G7 economies. From the many comments received from many companies, we have also recently announced the introduction of what I know is important to them; namely, a patent box to enable them to benefit from the fruits of research and intellectual property.

Overall, the sense is that we have got the balance about right. In recent weeks, as I have visited small and larger companies in the regions of this country, I have found that tax does not register as one of the regular issues where they are looking for enhanced government support. I think that they recognise the intent and the substance of what policies have already been announced.

[Baroness Hooper]

I also welcome the Statement and the White Paper. Because of my interest in Latin America, I note in particular and with pleasure the references to promoting trade and investment with that continent—in particular, Brazil and Mexico with their large and vibrant economies. I note also that the White Paper states:

“Our Embassies and High Commissions overseas are uniquely placed to advise on the complex political, economic and cultural factors that affect trade and investment opportunities in other countries. They can help facilitate access for UK business, help overcome barriers to market entry, secure a better in-country operating environment”.

Will my noble friend therefore assure us that the previous policy of closing, down-sizing and placing severe budgetary constraints on our embassies and overseas missions will be reversed?

[Lord Green of Hurstpierpoint]

I thank my noble friend Lady Hooper for drawing attention to a very important region, Latin America. Brazil is one of the most exciting countries in the world and I think that we all recognise that British business has not paid that part of the world as much attention as we probably should have in recent years and decades. That is now beginning to change. The Deputy Prime Minister is visiting Latin America next week, which follows a visit by the Secretary of State for Business, and I will be going later in the year. We are paying Latin America a great deal more attention.

With regard to embassies, I make two points. Embassies play a crucial role in this trade and investment strategy. The Government have defined the key priorities of the Foreign Office as being, first, commercial diplomacy and the prosperity agenda; secondly, security; and, thirdly, the consular function. The priority attached to commercial diplomacy is extremely important.

In terms of the deployment of resources, there is an intention to gradually shift resources in diplomatic terms to the faster growing countries, the emerging markets. Without being precise about the plans at this stage, I think that noble Lords can expect to see the sorts of countries that are of concern to them being beneficiaries of this process.