Commonwealth

Lord Chidgey Excerpts

Thursday 16th March 2017 Lords Chamber

[Lord Chidgey (LD)]

My Lords, there can be no more thrilling spectacle than the sight of the flags of the Commonwealth nations flowing down the central aisle of Westminster Abbey, carried, two by two, by 52 young people. That is what I think, anyway. On Commonwealth Day, their youth, enthusiasm and sense of expectation underlined both the diversity and the unity of their Commonwealth of Nations.

The new Secretary-General of the Commonwealth, the noble and learned Baroness, Lady Scotland, was absolutely right to recall Her Majesty the Queen’s observation, during her Silver Jubilee in 1977, that her role as Head of the Commonwealth represents,

“the transformation of the Crown from an emblem of dominion into a symbol of free and voluntary association. In all history this has no precedent”.

The noble and learned Baroness went on to say in the Ministers Reference Book Commonwealth 2017:

“A sense of continuity and building on the best of what we hold in common, enables it to flourish as a powerful influence for good … Exchange of ideas, as well as trade, are the lifeblood of Commonwealth connection”.

Acting early to prevent violent extremism has to be one of the Commonwealth’s top priorities. By offering support to strengthen and stabilise national institutions, the Commonwealth can be a steadying anchor in these turbulent times.

At this point I should declare an interest. I have been a member or officer of the APPG for the Commonwealth for some years, and I am currently the chairman of the National Liberal Club’s Commonwealth Forum.

As we prepare for the Commonwealth summit—CHOGM—in London and Windsor, to be held in the week beginning 16 April next year, we will find ourselves pretty well halfway through the UK’s Brexit negotiations with the EU. The received wisdom is that by then we will be forming a picture of to what degree the revival of long-neglected trading links with the Commonwealth will be feasible, and whether they can provide an essential cushion against the impact of the loss of preferential trade with the EU in 2019.

The International Trade Committee’s report to the House of Commons last week on UK trade options post 2019 provides some interesting insights. The 52 Commonwealth nations, ranging from developed to emerging to developing nations, present a bewildering array of potential trade options. A salutary factor is the marked decline in UK exports to the Commonwealth that has occurred since the UK joined the EU more than 40 years ago. Anyone who has ever been involved in international business development can tell you that it takes years to build customer confidence, trust and loyalty, and even longer to restore these when lost.

I well recall, working in Malaysia as a business development director for a UK international consulting engineering practice, the impact of the UK Government introducing a university fees structure for Commonwealth students which tripled their costs, compared to UK students. Two things happened. The USA and Australia almost immediately significantly increased the number of scholarship university places they offered to Commonwealth students, and the Prime Minister of Malaysia issued an edict to his country’s public and private sector procurement managers alike, to buy British last. The director of the Malaysian public water supply department reminisced with me over the wonderful times he had spent reading engineering at Glasgow University, and how he had followed the British systems and specifications for equipment. He therefore bought British goods and services throughout his professional life. I doubt very much whether his successors have followed his example, particularly as many now struggle to get a UK student visa, let alone assistance to attend a UK university.

According to the Commonwealth Secretariat, Brexit is likely to have far-reaching implications. Commonwealth members’ trade with the UK has long been governed through EU policies. Under Brexit, many developing country exporters are concerned that their market access into the UK and Europe could be disrupted. Brexit may also have implications for broader co-operation to take advantage of the apparent 19% Commonwealth trade-cost discount. Enhanced co-operation will also enable the Commonwealth to be an effective force for global good, in pursuit of realising the sustainable development goals. There has been an unprecedented global slowdown which is threatening the efforts to build on the achievements of the MDGs. Now is the time for the Commonwealth to play a pivotal role in making international trade an effective means of realising the sustainable development goals—the SDGs. Growth has slowed from 2.4% per year to 1.7% in 2016. There has been a lost decade of trade gains since 2008, which has had serious development implications. We could find that we have had the slowest decade of trade expansion since World War II.

The SDGs outlined in The 2030 Agenda for Sustainable Development aim to reduce the number of people living on less than $1.25 a day, which is currently 14%, to zero by 2030. The SDGs have extended scope to include the challenges of environmental sustainability, equity, inclusiveness, urbanisation and strengthening global partnerships. Reviving global trade flows while mitigating the consequences of Brexit is an important issue in keeping SDG implementation on track. The UK and the EU therefore need to work together to mitigate post-Brexit risks and manage uncertainties by continuing the trade preferences that developing countries currently enjoy in Europe and the UK.

The House of Lords Library has pointed out that in 2014, total UK exports to the Commonwealth were worth £48 billion, or some 9% of the UK’s exports overall. UK exports to the EU, meanwhile, amounted to around £250 billion—some five times that of the Commonwealth, which by any reckoning requires a huge displacement to rebalance. In the inaugural Commonwealth Trade Ministers meeting last week, business and sustainability was identified as one of the six key pillars of the “Agenda for Growth”. This was one of the areas which will contribute to greater intra-Commonwealth co-operation and utilisation of the Commonwealth factor. Ministers anticipate that this will unlock new trade and investment opportunities for member countries. Recent research by the Business & Sustainable Development Commission shows that the SDGs will require something like $2 trillion to $3 trillion each year in new investment, but can help to unlock $12 trillion in new market value across 60 sectors. These figures are beyond the scope of my imagination, but that is what they are.

The “Agenda for Growth” posed a number of key questions and I would be grateful if, in her reply, the Minister could share with noble Lords the answers that those Ministers arrived at in their panels. For example, do the SDGs provide a useful framework for businesses and Governments to understand the scale of the sustainability challenge that we face and restore public trust in states’ abilities to meet this challenge? What role can the Commonwealth play in raising awareness and helping Governments to meet this challenge? Finally, how can private investment be best mobilised to support the sustainability goals in countries where their credit and reliability put the risk assessment out of reach?