UK-Israel Trade

Chris Green Excerpts

Tuesday 3rd July 2018 Westminster Hall

[Mr Nigel Evans (in the Chair)]

It is quite warm, so if anybody wishes to remove an item of clothing, please feel free to do so.

[Chris Green (Bolton West) (Con)]

I beg to move,

That this House has considered UK-Israel trade.

It is a pleasure to serve under your chairmanship, Mr Evans.

Before I came here as a Member of Parliament, I worked in the mass spectrometry industry for nearly 20 years. The great pleasure of that was travelling across the world, from Cuba to Taiwan and so many places in between. It was an absolute delight in 2001 and 2002 to do a little bit of work in Israel. A particular highlight for me was working at the Hebrew University of Jerusalem. While there, I had my first opportunity to visit a synagogue. The one I visited had the spectacular stained-glass windows designed, created and made by Marc Chagall, representing the 12 tribes of Israel. It is a spectacular vision in the synagogue, and it is particularly important to recognise the value of not only industry, universities and academia, but art and culture that we can share around the world.

Last week, His Royal Highness the Duke of Cambridge made the first ever official visit by a senior royal to Israel. Speaking in Tel Aviv, the economic heart of Israel, he proclaimed:

“The ties between our two countries have never been stronger, whether in our record levels of trade and investment, our cooperation in science and technology; or the work we do together to keep our people safe.”

The Prince’s visit to Israel last week was a strong symbolic sign that the relationship between our two great nations is better than ever. One can also point to the remarkable record levels of trade to see how tangible this flourishing relationship truly is. In his words and actions, I believe His Royal Highness the Duke of Cambridge captured what today’s debate is about.

Many people, as I did before my visits to Israel nearly 20 years ago, think of the country through the prism of its biblical narrative. They think of deserts, mountains and the Sea of Galilee, but the reality for many Israelis is very different. The Israelis have created a country that is every bit as advanced as Britain and the United States of America, which shows what can be done with talent and an immense amount of hard work. That entrepreneurial culture has resulted in what many now describe as a start-up nation. Every day Israel hosts delegations from across the world, looking to understand the secrets of the country’s success—a country that, we must not forget, is the size of Wales with a population of less than 9 million people.

The UK-Israel friendship runs deep, from our shared democratic values to our extensive co-operation in the fields of intelligence, defence and cyber-security. Prince William was right to point out our record levels of bilateral trade, which reached £6.9 billion last year. In the first five months of 2018 alone, UK-Israel trade reached £3.3 billion—a 22% increase compared with the same time last year. This year-on-year increase in the value of bilateral trade has been happening now for almost a decade.

[James Morris (Halesowen and Rowley Regis) (Con)]

I should declare to the House my entry in the Register of Members’ Financial Interests, following my recent trip to Israel to discuss trade matters. Does my hon. Friend agree that Israel has become a global powerhouse for research and development, with quite a lot of the big software houses and companies such as Google and Facebook, but that the level of research and development co-operation between the UK and Israel is probably not as high as it could be? Does he think there are further opportunities there for British companies to take advantage of the R&D powerhouse being created in Israel?

[Chris Green]

I agree entirely. Israel has attracted talent and is creating its own talent within the country. That relationship is improving around the world and it is yet to do so, and we ought to be taking advantage of that as we look to the future.

Trade has been increasing and improving for almost a decade and there are no signs of it stopping or slowing down. Britain is, after all, Israel’s second largest export destination after the United States of America and its principal trading destination in Europe. About 30 Israeli companies are registered on the London stock exchange and about 300 Israeli companies operate in the UK, employing thousands of Britons.

[Dr Matthew Offord (Hendon) (Con)]

I congratulate my hon. Friend on securing the debate. If necessary, I will certainly declare my interest, having recently visited Israel. Is he aware that Israel has the highest density of start-up companies in the world? There is one start-up company for every 1,600 people within the population. That is the basis of the economic success in the country and internationally.

[Chris Green]

Those are incredible statistics and they show the innovative and entrepreneurial nature that so many Israelis have and the culture that the wider society embraces. As I mentioned and as has been highlighted, Israel is renowned as the start-up nation—a true high-tech start-up powerhouse. Israel is widely viewed as a desert country with few natural resources, which is perhaps one of the drivers behind that, although there have been discoveries of natural gas off the coast. Despite the geographical challenges and some security threats, an enormous number of innovations and inventions have emerged from the country. Israel has gone from being a desert to the land of milk and honey, and now the land of Apple and Microsoft. Indeed, most of the world’s leading tech companies now have a research and development presence in the country, which is testament to the character and qualities of the people, which my hon. Friend highlighted.

The country’s prowess in the fields of high-tech, energy, medical science and FinTech is in large part due to the need to adapt as challenges arise.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

My hon. Friend is making an extremely important point. Does he agree that the extraordinary levels of inward investment into Israel by high-end, high-value companies in the tech space and pharmaceutical space demonstrate that when British companies do business with Israel they are plugging themselves into some of the highest-value sectors of the global economy, which is exactly what we need to do to make Brexit a success?

[Chris Green]

I agree entirely; my right hon. Friend is absolutely right. That highlights the connectivity and relationships that underpin so much of high tech, culture and the arts.

The necessity of adapting and developing solutions to the challenges Israel faces is a key part of its impressive start-up ecosystem. The culture of entrepreneurship and striving to achieve is reflected in the fact that there have been 12 Israeli Nobel prize winners in the fields of peace, literature, physics, chemistry, medicines and economics; I think that is a 100% record across all the different fields in which they could achieve Nobel recognition. Israelis will be the first to tell you that the Israeli autonomous driving company Mobileye was sold to Intel for a remarkable £12.5 billion and is just one of many success stories, including Waze, the USB storage device and internet firewalls.

As we debate here, dozens of Israeli scale-up founders are in London sharing their experience as part of Innovate Israel 2018. The event, co-ordinated by UK Israel Business, has become a major event in the UK high-tech calendar and is another example of how British and Israeli businesspeople work together every day.

Israel’s cultural exports are no less significant. Netta famously captured the hearts of a continent this year when she won the Eurovision song contest. Hers was an amazing performance that delighted all those who watched it on the evening and on YouTube or other sources afterwards.

[Iain Stewart (Milton Keynes South) (Con)]

Will my hon. Friend demonstrate that performance?

[Chris Green]

I have been practising, but I understand that there is a convention against singing during debates.

[Mr Nigel Evans (in the Chair)]

I am not sure that I would enforce that.

[Chris Green]

As a traditionalist, I will adhere to the convention.

It is no surprise that the first bilateral tech hub was launched by the British embassy in Israel in 2011. The UK-Israel tech hub is one of the first of its kind to promote partnerships in technology and innovation between the two countries. It has generated 175 tech partnerships in deals worth £85 million since it was established, and it has helped to boost the UK economy by an estimated £800 million. I have been to Israel to hear about this excellent initiative, and as we prepare for Brexit it is heartening to hear that this model will be replicated in other countries across the world, ensuring that Britain is well placed in the ongoing tech revolution.

[Nigel Dodds (Belfast North) (DUP)]

I congratulate the hon. Gentleman on securing the debate. Does he agree that it is gratifying to hear that the UK has prioritised a free trade agreement and trade links with Israel post Brexit? The whole UK—all its countries and regions—should be actively involved in seeking the opportunities that will exist through better UK-Israel trade.

[Chris Green]

I wholeheartedly agree. As a Greater Manchester and Lancashire MP, I certainly want the north-west of England to participate in this tech revolution, and Northern Ireland certainly should as well. I was born in Ballymena, so I have a personal interest in that.

Other success stories that spring to mind include the landmark £1 billion agreement between Rolls-Royce and El Al in 2016, and I recently heard that the fastest growing Aston Martin dealership in the world is based in Israel.

The UK has signed countless agreements with Israel in science and innovation, and Israeli and British scientists work together every day on cutting-edge research. The Britain Israel Research and Academic Exchange Partnership is a significant part of that, bringing researchers from both countries together to tackle some of the world’s most challenging medical conditions and diseases, including cardiovascular and liver disease, diabetes and Parkinson’s. Each of these research programmes stands to benefit Israeli and British citizens, and no doubt many other people right across the world. That ought to be celebrated.

We should also consider that some 74% of Israeli exports to Britain in 2017 were in the medical equipment and pharma sector. It is undeniable that this relationship keeps Britons healthier, so will the Minister join me in restating the importance of this sector of trade, and will he provide assurances that it will be uninterrupted as we leave the EU?

Israel was one of the first countries that we began discussions with following our vote to leave the European Union. Last year we created the UK-Israel trade working group, which will ensure a smooth post-Brexit transition and is exploring opportunities to maximise further trade.

[Richard Burden (Birmingham, Northfield) (Lab)]

The hon. Gentleman talks about Britain’s post-Brexit trading relationship with Israel. Does he agree that the definitions in the EU-Israel association agreement, particularly in relation to the settlements, should carry through into any bilateral trading relationship that Britain has with Israel? The trade preferences available under the EU-Israel association agreement do not extend to illegal settlements in the west bank.

[Chris Green]

I think we ought not to bind ourselves. Any trading relationship or ongoing process evolves over time, and we need to keep an open mind in any ongoing negotiations. Both sides of that divide here should seek an ongoing negotiation because, for example, there might be the possibility of land swaps. We in the United Kingdom ought not to put down lines in the sand. The Minister may develop that further.

[Andy Slaughter (Hammersmith) (Lab)]

For clarity, any new agreement will clearly have to be negotiated on its own terms, for better or for worse. I think the point that my hon. Friend the Member for Birmingham, Northfield (Richard Burden) was making related to issues of illegality, and it is unquestionably the Foreign Office’s view that the settlements are illegal under international law. Article 2 of the EU-Israel association agreement provides that human rights considerations should be instrumental. Surely he would want that to carry through, irrespective of any other terms?

[Chris Green]

I did not quite catch all of the hon. Gentleman’s question. However, I would not want, in this room, to set in stone anything that will evolve over time.

[Mr Mark Harper (Forest of Dean) (Con)]

We have to recognise that strengthening businesses, businesspeople and the economies on both sides—in Israel and the occupied territories—is how we will achieve a viable two-state solution. Doing as the Boycott, Divestment, Sanctions movement wants, which is to discriminate against businesses in Israel without distinguishing where they are, will damage the economy and the interests of not only Israelis, but Palestinians seeking to earn a living.

[Chris Green]

Absolutely. The impoverishment of people, whether in the Palestinian territories or in Israel, is one of the drivers of violence. People who do not believe that they have a future sometimes turn to violence. We ought to ensure that, so far as possible, the whole region becomes increasingly economically successful.

[Dr Offord]

Is my hon. Friend aware that more than 500 Palestinians lost their jobs after the SodaStream factory in the west bank was forced to close after the campaign by the BDS movement? Those people will now not have livelihoods, but they will certainly have families to provide for. Does he agree that that was a disgraceful campaign against people in the west bank?

[Chris Green]

I think it is a disgrace. Forcing people to be unemployed and kicking them out of their jobs is appalling and damaging to them, their families and the wider communities.

[Richard Burden]

Will the hon. Gentleman give way?

[Chris Green]

I will move on from this particular point; hon. Members from both sides of the House have had an opportunity to explore it.

I understand that the existing EU-Israel association agreement will form the basis of a future trade deal, but that there are great opportunities for further collaboration, particularly in the agriculture sector, in which Israel excels.

[Iain Stewart]

The House will shortly consider the remaining stages of the Trade Bill, which seeks to convert from EU law into UK law all the EU’s existing third-country trade deals. That will apply to the EU-Israel deal, which, as my hon. Friend says, will give businesses both continuity and the flexibility to enact the changes that he refers to.

[Chris Green]

I agree. We need in our ongoing relationships a sense of bringing down barriers, enhancing agreements that we already have and creating new and much more comprehensive agreements. Is the Minister able to clarify whether the association agreement will indeed form the basis of a future trade deal with Israel, and is he able to provide an update on discussions regarding agricultural trade?

I had a particular interest in science and industry before my election to Parliament, and I have a particular interest in Israel’s relationship with Horizon 2020. It was the first non-European country to have such a relationship, and in that sense the United Kingdom has something to look up to, to respect and to admire in Israel’s collaboration with European scientists on Horizon 2020. As we look forward to the opportunities presented by our leaving the European Union, we may look forward to framework programme 9—the successor to Horizon 2020—and wish to participate in that. Israel, by already having that kind of relationship, shows us what could happen.

When we look to the United States of America, we get a sense that the world is creating new barriers against trade and people. We ought, especially when looking at the European Union, to have the sense that right across Europe, the United States and the wider world, we are trying to bring down those barriers. In particular, we ought not to be promoting or increasing barriers with the state of Israel. We need to create ever stronger cultural, academic and social ties and, with trade being so important, to have the freedom to trade with countries around the world. We may wish to buy oranges from Spain or other countries, but I look forward to buying my first Jaffa orange post Brexit.

[Several hon. Members rose—]

--- Later in debate ---

[Chris Green]

I thank the Minister for such a positive speech and for dealing with so many of the issues that came out during the debate.

It has been an incredibly positive debate about the relationship between the United Kingdom and Israel, and about our trade, covering everything from agriculture to medical technology, and on to the fourth industrial revolution.

I will highlight something the hon. Member for Liverpool, Riverside (Dame Louise Ellman) said, which I myself might not have picked up on: the importance of trade for the trade union movement and the co-operative movement. It is so important that we have strong trade, because good trade is good for workers and I am therefore delighted to see the level of UK-Israel solidarity.

Question put and agreed to.

Resolved,

That this House has considered UK-Israel trade.