Trade Deals and Fair Trade

Conor Burns Excerpts

Wednesday 11th March 2020 Westminster Hall

[The Minister of State, Department for International Trade (Conor Burns)]

It is a pleasure to serve under your chairmanship, Mr Stringer, for my first speech as a Minister in Westminster Hall. I congratulate the hon. Member for Swansea West (Geraint Davies) on securing the debate, and other hon. Members not only on their contributions but on their ingenuity in using this occasion at the end of Fairtrade fortnight to widen the debate into one about our future free trade agreements around the world, in particular with the United States. I also congratulate the hon. Gentleman on having been such a doughty advocate for the cause of fair trade over the years—a position that the Government share.

The Department for International Trade works very closely with the Fairtrade Foundation; indeed, the foundation serves on the strategic trade advisory group—the STAG—which I chair as the Minister responsible for trade policy. The global fair trade system reaches more than 1.5 million farmers and workers in more than 73 countries, many of which have historical ties to the UK, principally through the Commonwealth. The UK market for Fairtrade certified goods, which is underpinned by fair trade standards, minimum prices and direct payment of premiums to producers, has grown into one of the world’s largest. The Fairtrade mark continues to be trusted highly by the UK consumer, with more than 80% of the public saying they trust it.

Working towards a living income in domestic and global value chains is one of the keys to driving poverty reduction and economic development, and fair trade plays a crucial role in that. It also provides a means to create wealth, jobs and prosperity in local communities, in turn driving a country’s development and allowing it to grow into a trading partner of the future.

I will give some examples of how the Government, across various Departments, support free and fair trade. Between 2010 and 2016, the Department for International Development provided £20 million to Fairtrade International to help it to have a greater impact through its work and to make the global fair trade system stronger. DFID has also supported fair trade by investing more than £30 million in the responsible, accountable and transparent enterprise programme. That programme has helped to fund Shift, which works to improve companies’ human rights reporting through capacity building in business and human rights, and a new reporting database. It has also piloted and promoted Fairsource, a suite of supply chain mapping tools for use by companies to improve the sourcing of agricultural commodities such as flowers and cocoa, which was referred to by the hon. Member for Strangford (Jim Shannon). Fairsource dashboards are now available for more than 410 businesses and have been used by household names such as Ben & Jerry’s, Marks & Spencer and Starbucks.

Achieving the UN sustainable development goals by 2030 means achieving inclusive economic growth and decent jobs. The Government are committed to supporting that to spread opportunity ever more widely. We have the trade and investment advocacy fund to build developing countries’ capacity to participate in trade negotiations and fully engage at the World Trade Organisation. We have the SheTrades Commonwealth programme to enhance the competitiveness of women entrepreneurs in Commonwealth countries by connecting them to international markets. We have the Commonwealth Standards Network to increase awareness and the use of international standards across the Commonwealth in order to boost trade.

[Geraint Davies]

The Minister mentioned the good work of DFID in promoting fairness. Will he confirm, or press the Government to ensure, that DFID’s work continues and that it is integral to trade negotiations? There is some concern that the Department for International Trade is working in isolation and in the interests of investors, while DFID may be thinking about fair trade. It is important to hardwire the interests of fair trade into future trade arrangements.

[Conor Burns]

I agree with the hon. Gentleman. I know that my right hon. Friend the Prime Minister, when he served as Foreign and Commonwealth Secretary —I was his Parliamentary Private Secretary at the time—was frustrated to a degree by the disconnect that sometimes existed between DFID and the Foreign Office in pursuing Britain’s overall development and foreign policy objectives. It absolutely makes sense that we should try to co-ordinate our activity across all the international Departments of Government to get maximum influence for the United Kingdom and, most importantly, the most positive outcomes. One of the key drivers that motivates us in the Department for International Trade is the opportunity of trade with some of the poorest countries in the world to increase the opportunity for wider prosperity there. That will be at the heart of trade policy as we develop future free trade agreements.

We give £15 million to support the implementation of the trade facilitation agreement programme, which helps developing countries to reduce inefficient border processes, excessive red tape and administrative bottlenecks, which are hindrances to effective trade. The UK is the largest donor to the WTO’s enhanced integrated framework, providing technical and financial support to build trade capacity in 51 of the poorest countries in the world and to increase agricultural productivity for both local consumption and export. Through our support for the Impact Management Project, more than 2,000 organisations are harmonising a global approach to managing impact, including robust global standards on measurement and reporting. We are also examining the potential for fair trade standards to encourage businesses to be more responsible and reach vulnerable people in their supply chains.

Let me turn to a point raised by the hon. Member for Strangford—who is currently being interfered with by my hon. Friend the Member for Beckenham (Bob Stewart), who has just arrived in his coat. The hon. Gentleman mentioned the terrible conditions in which some people work in some of the poorest parts of the world. We are absolutely clear that those people and providing them with opportunities are at the heart of our trade policy. That means engaging across the whole supply chain, working in partnership with businesses, NGOs, producers, investors and consumers to be more responsible and reaching vulnerable people to ensure safe and decent opportunities for all.

Now that we have left the EU, we have a superb opportunity to advance the agenda further. It will enable us to build a fully integrated training and development package, encompassing trade preferences for developing countries alongside our existing aid spending. We know that trade is a key driver of economic growth, helping to raise incomes, create jobs and lift people out of poverty. That is why the Government are working to place development and global prosperity at the heart of UK trade policy.

Free and fair trade has been a great liberator for the world’s poor. Between 1990 and 2015, the number of people living in extreme poverty globally fell by more than 1 billion, but as the hon. Member for Strangford indicated, there is still so much to do. I say to the shadow Minister, the hon. Member for Sefton Central (Bill Esterson), that fair trade also means free trade. Let me tell him and colleagues that by free trade we mean supporting the international rules-based global trading order to ensure that trade works in the interests of all countries, large and small. As an independent trading nation, the United Kingdom will prioritise fair trade and, in particular, trade that helps developing countries to lift themselves out of poverty. That starts with working to ensure continuity in our trade agreements with those developing countries.

Following the transition period, the UK will put in place its own trade preference scheme granting duty-free, quota-free access to 48 least developed countries and tariff reductions to other developing nations. Far from rowing back, as was suggested, we intend to use our new independence to go forward. I contend that while DFID is the Department spending 0.7% of gross national income on development, the Department for International Trade is also, in a very real and profound sense, a Department for development by providing opportunities for creation of wealth and prosperity through trade.

We have signed four development-focused economic partnership agreements with the Southern African Customs Union, and Mozambique and other specific eastern and south African states. We continue to work with our partners on arrangements for the remaining countries covered by EU economic partnership agreements, including Cameroon, Côte d’Ivoire, Ghana and Madagascar. As was alluded to by the hon. Member for Halifax (Holly Lynch), we are absolutely determined to get those over the line. In fact, only last week I met representatives from some of those countries to discuss how we could get those agreements rolled over by the end of the year. We are also using our influence in organisations such as the WTO.

[Geraint Davies]

The Minister will know that the history of investor-state dispute mechanisms is basically about protecting investors who invested in countries without established systems of law and protection for investors. These days, we need a system in which people can invest in the knowledge that the host nation will also protect its environment and workers’ rights. Will he endeavour to strike deals that ensure that those social and environmental rights will be protected alongside investors’ rights, with investors’ rights not trumping those rights and attempts in host countries to protect those vital interests?

--- Later in debate ---

[Conor Burns]

We will first roll over our existing trade agreements, but we will then want to go further on many of them. We will want to ensure that the trade agreements we strike offer the opportunity to raise standards and consumer and employee protections. We do not see trade agreements as a race to the bottom. I will say a bit more about that in a moment, but I am also conscious of your stricture, Mr Stringer, to leave a little time at the end.

I will respond directly to more of the points made by colleagues. We heard quite a bit from the hon. Member for Swansea West about the national health service, medicine pricing and privatisation. I do not know how much more explicit the Government need to be in our resolve—those things are categorically not on the table. In fact, in the US negotiating bundle, we put that in black and white. Those things are not on the table. My right hon. Friend the Secretary of State has been clear that were the United States to expect or demand things of us that we did not think were acceptable, we would walk away. I understand the politics of it—it is a very useful message—but it is categorically not correct.

My hon. Friend the Member for Henley (John Howell) does a great job as the Prime Minister’s trade envoy to Nigeria, which I hope to visit in the next couple of weeks—it depends on the virus. I hope to have a chat with him before we go. He made some excellent points. He talked about modern slavery, and one of the greatest achievements of my right hon. Friend the Member for Maidenhead (Mrs May) is the Modern Slavery Act 2015. I had the privilege to serve on its Bill Committee.

I referred to some of the points made by the hon. Member for Strangford. I will not get into the debate about whether milk or dark chocolate is best, particularly since we are in Lent and I have given it up. I congratulate the hon. Member for Stockport (Navendu Mishra) on his first speech in this Chamber.

To the hon. Member for Dundee East (Stewart Hosie), I point out that my Department does not lead on the UK-EU negotiations, which is regretted by the shadow Minister. We just have the rest of the world, which does keep us moderately busy, as I am sure colleagues understand. In terms of the dispute resolution, the critical difference between us and the EU at the moment is that it sees an ongoing role for the European Court as a judgment mechanism on some of these matters, whereas we are explicitly clear that we have left the European Union, and at the end of the transition period the European Court can have no jurisdiction in the United Kingdom; the supreme court in the United Kingdom will be the UK Supreme Court.

The hon. Member mentioned the involvement of the devolved Governments and devolved nations in the negotiations for future free trade agreements. I look forward to meeting my SNP trade counterpart, Minister McKee, this afternoon. We have had a successful programme, as acknowledged in all bar the SNP’s press releases, of sharing documents and information at an official level. We have been totally clear that we intend to negotiate on behalf of all nations and all regions of the United Kingdom.

I said in response to the shadow Minister that we do not lead on the EU; we have the rest of the world, and it is quite a big task. We are clear that we want reform of the WTO. The Secretary of State was in Geneva last week, taking our seat and making the first speech there by a Cabinet Trade Minister for almost 50 years. We passionately want a resolution to the Airbus-Boeing dispute. We hope that the United States will agree to appoint people to make the appellant body quorate again, but we agree with the United States that the WTO more widely does need reform. The Prime Minister has been clear that what we negotiate will be driven by evidence and science, not rumour and mythology, but we want the agriculture sector in the UK to take the opportunities of future FTAs, not least that with the United States, which will be incredibly positive for the sector.

In conclusion, on workers’ rights, manufacturing and environmental standards and the NHS, the shadow Minister was essentially saying that those of us on the Government side are motivated by bad values and want to do bad things. In a sense this is the big difference. I want him and the country to understand that we see great opportunities in free trade agreements for our citizens and companies to grow, with prosperity, wealth and opportunity for all, and to have free and fair trade, which has been the unblocker of liberty, social progress and political rights across the world. We see an opportunity opening before us, providing enormous chances to some of the world’s poorest people. In the months ahead, I will be very proud to advance that agenda.