Oral Answers to Questions

Liam Fox Excerpts

Thursday 17th May 2018 Commons Chamber

[Mrs Madeleine Moon (Bridgend) (Lab)]

1. What recent discussions he has had with his international counterparts on US tariffs on steel and aluminium.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

The Prime Minister and I continue to raise our concerns with President Trump and his Administration about the potentially damaging impact of tariffs on our steel and aluminium industries.  We are working closely with the US and our EU partners to secure a permanent EU exemption to these tariffs.

[Mrs Moon]

Steel tariff exemptions are vital for Tata Steel. Many of my constituents work at Tata in Port Talbot in the next constituency along from mine. The exemption is welcome, but there are concerns about the US placing quotas on steel imports, which will have a major impact on the exports going not just from Britain but from Europe. How does the Secretary of State see himself protecting our export trade once we leave the European Union and do not have its negotiating power behind us?

[Dr Fox]

When it comes to protection post EU, we will have our own trade remedies measures. But of course the hon. Lady and her Labour colleagues voted against our being able to establish those when the legislation came to the House.

[Nic Dakin (Scunthorpe) (Lab)]

What is the Secretary of State doing with our partners to ensure that we do not suffer from diversionary dumping of steel as a result of what the US is doing?

[Dr Fox]

We want to see a permanent exemption so that we do not get into that position in the first place, but we have made it clear that we would operate with our European partners to ensure that we took any measures necessary that were proportionate and within international trade law to ensure that the situation that the hon. Gentleman describes would not happen.

[Barry Gardiner (Brent North) (Lab)]

The US President seems intent on undermining the World Trade Organisation’s multilateral rules-based system. He is delaying the settlement of disputes by vetoing the appointment of judges to the appellate body and is using national security as a cover, in this case, for naked protectionism against foreign steel and aluminium. Does the Secretary of State still think that Donald Trump is a man we can do business with?

[Dr Fox]

We do business with the United States Administration because the United States is our closest strategic partner. Where we disagree on issues such as steel, we make our voice very clear. We do not support the use of section 232 as a mechanism for dealing with the overproduction of steel. That actually hits the United States’ allies and not the designed target, which was China. Citing national security, particularly in Britain’s case, makes no sense at all given that some of the steel that we send to the United States goes into its military programmes.

[Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)]

2. What steps he is taking to ensure that UK trade with developing countries promotes women’s rights after the UK leaves the EU.

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[Nigel Mills (Amber Valley) (Con)]

11. What steps his Department has taken to promote the merits of free trade to the public.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

The UK champions the opportunities created by free trade. As I said in my lecture at Speaker’s House last month, free trade increases prosperity, stability and, in turn, security. My Department engages businesses and the public to set out the economic and moral case for free trade: better UK jobs, consumer access to high-quality, well-priced goods and services, and lifting people in the developing world out of poverty.

[Martin Vickers]

I thank the Secretary of State for his reply. Forecasts suggest that 90% of economic growth in the coming years will be in countries outside the EU. Does he agree that that gives this country great opportunities to extend our trade with developing nations, which will be of great benefit to them?

[Dr Fox]

I agree with my hon. Friend that that provides enormous opportunities. Free trade has helped to lift more than 1 billion people out of poverty since 1990, and we will do all we can to continue to support the liberalisation of trade with developing countries. Indeed, we demonstrated that commitment by announcing £18 million to support the WTO’s enhanced integration framework in December at Buenos Aires.

[Nigel Mills]

A slightly surprising grouping, Mr Speaker. Does the Secretary of State agree that the public might be even more strongly in favour of free trade if they are completely convinced that the right remedies are in place for goods that come from countries that are perhaps not quite as keen on free trade as we are? The ceramics industry, for example, has a big base in my constituency, so will he ensure that, when we import products from countries that have a state-distorted market, the right powers are in place in the Bill?

[Dr Fox]

I am grateful for the support that my hon. Friend gives to the ceramics industry. It is, of course, necessary to have an international rules-based system. Where we have problems with that, it is our duty to try to improve it, not to try to break or leave the system.

[Sandy Martin (Ipswich) (Lab)]

What optimistic free trade message is the Secretary of State going to give to Welsh hill farmers or Suffolk sugar beet growers?

[Dr Fox]

The same message that I would give to everybody: free trade is of benefit to consumers and producers alike in the UK and to our trading partners. As I said, it has been one of the main tools through which we have alleviated global poverty.

[Jeremy Lefroy (Stafford) (Con)]

One thing that free trade depends on is investment. What steps is my right hon. Friend taking to promote outward direct investment by the UK to help those countries with which we would like to engage in greater free trade?

[Dr Fox]

The Government have recently completed a number of pilot projects on outward direct investment, and ODI can be a major adjunct to our development agenda. I recently visited a Jaguar Land Rover dealership in Johannesburg. It is not only promoting the sale of UK goods abroad, but providing apprenticeships in mechanics and salesmanship for some of the most deprived young people in Johannesburg. Trade and development can go hand in hand.

[Mr Mark Prisk (Hertford and Stortford) (Con)]

Those who advocate protectionism often claim that free trade means a free-for-all. It is not. May I urge the Secretary of State to make it clear that free trade means trading within the rule of law, with clear remedies to the benefit of everyone?

[Dr Fox]

The WTO and the rules-based system is under attack, it has to be said, today. If the WTO did not exist we would have to invent it. There is a need for a rules-based system, otherwise we would have a free-for-all. The alternative to a rules-based system is a deals-based system, which might be fine for some of the biggest economies but would not help many of the smaller developing economies. It is our moral duty to ensure that there is fair play across trade.

[Victoria Prentis (Banbury) (Con)]

5. What steps his Department is taking to increase the level of foreign direct investment into the UK.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

To ensure that we continue to be a global leader in attracting foreign direct investment, the Department for International Trade has launched a new FDI strategy that will deliver new ways to target support for those projects that create the most value for investors and national wealth. I am pleased to say that 2016-17 was a record year for FDI projects landing in the UK, showing that the fundamentals of the UK economy are strong.

[Victoria Prentis]

Will my right hon. Friend tell me why, in his assessment, investors choose to invest in the UK?

[Dr Fox]

We regularly ask our investors why they put money in the UK and the answers are very similar. They say that the British legal system provides certainty and predictability. We have a skilled workforce. We have a good, predictable regulatory system and a low-taxation economy. We speak English. We have some of the best universities and some of the best access to tech, and we are in a good time zone for global trading. None of those, incidentally, depends on our membership of the European Union.

[Stephen Hammond (Wimbledon) (Con)]

6. What assessment he has made of the potential benefits to the UK arising from third-country trade deals after the UK leaves the EU.

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[Mr Bob Seely (Isle of Wight) (Con)]

8. What progress he made on potential trade agreements with Commonwealth countries at the Commonwealth Heads of Government Meeting in April 2018.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

My Department continues to work with the 24 Commonwealth countries that are part of the EU’s economic partnership agreements or other preferential arrangements to ensure that there is no disruption to our existing trade. We also have regular discussions with Australia and New Zealand on our future bilateral trading relationships through our trade working groups. With Canada, we already have an agreement in place in CETA—the comprehensive economic and trade agreement—which will form the basis of a UK-Canada agreement once we have left the European Union.

[Mr Seely]

That is good news. Firms in my constituency such as GKN-Melrose, Vestas and BAE Systems export across the Commonwealth and the wider world. Is my right hon. Friend confident that post Brexit, we will be able to continue and grow that trade?

[Dr Fox]

Very confident. I pay tribute to the companies such as BAE and GKN that he mentions in his constituency, which are exemplary exporters. We intend to have an open and comprehensive trade agreement with the European Union. We intend to take advantage of the fact that the International Monetary Fund says that 90% of the global trade increase will be outside Europe in the next 10 to 15 years, and we have a new export strategy to support all exporters, including the ones that he mentions in his constituency.

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

Ironically, a trade deal between India and the European Union is more likely to be agreed by the remaining EU27, as two of the main stumbling blocks are whisky and visas, which mainly involve the United Kingdom. Therefore, will the Secretary of State advise me, the House and my constituents at the Auchentoshan distillery and the Loch Lomond distillery how they will seek to overcome that when the Government will be all alone?

[Dr Fox]

One of the main problems with India, of course, is the tariff that it applies on whisky. We have been involved in a trade review with India for some months now, and part of the process is to look at the areas where we require liberalisation to bring our two economies close enough to be able to consider a free trade agreement. The high tariff applied on Scotch whisky by India is one of the impediments, and we continue to urge them to reduce that.

[Kerry McCarthy (Bristol East) (Lab)]

9. If he will take steps to ensure that the UK has third-party membership of current EU free trade agreements to maintain compliance with rules of origin requirements after the UK leaves the EU.

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[Alex Cunningham (Stockton North) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for International Trade and President of the Board of Trade (Dr Liam Fox)]

My Department is responsible for foreign and outward direct investment, for establishing an independent trade policy, and for export promotion. I am delighted to announce that my Department recently appointed John Mahon as our new director general for exports; he will oversee the delivery of the Government’s export strategy. Later today, my fellow Ministers and I will be in Stirling for the third meeting of the Board of Trade.

[Alex Cunningham]

In the light of the latest mass killing of Palestinian civilians by the Israel Defence Forces, will the Secretary of State review and apply the criteria for arms sales to states that violate international law?

[Dr Fox]

The UK has one of the most robust arms export systems, which we operate under the consolidated criteria in line with our EU partners.

[Rachel Maclean (Redditch) (Con)]

I welcome the Department’s focus on international trade. I am delighted to hear that the Redditch eastern gateway is included in a project and strategy that the Secretary of State will announce today. Will he update the House on what he will do to bring much-needed international investment into Redditch?

[Dr Fox]

Later today I shall outline a project to attract £30 billion of foreign direct investment to the United Kingdom. Many projects, such as the one mentioned by my hon. Friend, are not necessarily visible to global investors, but our new website will ensure that we can attract more investment in middle-sized opportunities, which will genuinely help to bring prosperity to constituencies such as my hon. Friend’s.

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[Colin Clark (Gordon) (Con)]

T2. I hope that the Secretary of State enjoyed his recent visit to Aberdeen, which is probably the most productive part of Scotland, let alone the United Kingdom. Does he agree that the oil and gas industry is a deserving recipient of the export finance that is boosting that valuable sector?

[Dr Fox]

I did indeed enjoy my visit to Aberdeen, where I was able to chair a roundtable of companies from across the oil and gas industries as well as meeting senior figures from the Wood Group. Representatives of UK Export Finance were present at both meetings, and, as my hon. Friend will know, we are more than happy for UKEF facilities to be made available to the sector.

[Sandy Martin (Ipswich) (Lab)]

T4. Given the uncertainty over the future customs arrangements between this country and the rest of Europe, what steps is the Department taking to ensure that training is provided for the additional customs officials who will be needed to deal with the probable extra workload?

[Dr Fox]

That is not, in fact, the duty of the Department. Her Majesty’s Revenue and Customs is responsible for customs in the United Kingdom. None the less, HMRC has received extra funds from the Treasury to ensure that preparations are made for Brexit.

[Leo Docherty (Aldershot) (Con)]

The UK defence and aerospace industry plays a vital role in the country’s prosperity, and Farnborough, in my constituency, has a special place at the heart of it. What steps is the Department taking to support the industry, and will the Secretary of State kindly confirm that members of his team will attend the Farnborough international air show in July?

[Dr Fox]

I can certainly give that assurance to my hon. Friend. He will also know that in order to improve the functioning of our defence and security exports we are reorganising the Defence and Security Organisation so as to separate the defence from the security elements, because they require different levels and types of Government intervention and contact. I want to ensure that the appropriate skills are there to maximise our defence and security exports.

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[Ross Thomson (Aberdeen South) (Con)]

It was a pleasure to welcome the Secretary of State to my constituency last week where he could see that, from food and drink to oil and gas, Aberdeen is best placed to take on the opportunities of Brexit. I thank my right hon. Friend’s Department for promoting Aberdeen’s £150 million Queen’s Square project this afternoon. Will my right hon. Friend update the House on the benefits to Scotland of extending the high potential opportunity scheme, and does it not show that Scotland is better off in the United Kingdom?

[Dr Fox]

One of the benefits of having a UK-wide Department is that we are able to use economies of scale to lever international investment into the whole of the United Kingdom. My hon. Friend will be aware that a number of projects in Scotland are being highlighted today during our visit to Stirling, and it is much better to have a UK-wide Department able to bring investment to all parts of the United Kingdom than to have it broken up and fragmented.

The Minister for Women and Equalities was asked—