Brexit: Commonwealth, Trade and Migration

Lord Price Excerpts

Monday 13th March 2017 Lords Chamber

[Baroness Berridge]

To ask Her Majesty’s Government what is their assessment of future trade and migration from and to Commonwealth countries after the United Kingdom leaves the European Union.

[The Minister of State, Department for International Trade (Lord Price) (Con)]

Our links with the Commonwealth are extremely important. We enjoy excellent trading relationships with Commonwealth partners and are committed to strengthening these further. As we leave the EU, openness to international talent will remain one of this country’s most distinctive assets. The process will be managed properly so that our immigration system serves the national interest. The precise arrangements are yet to be determined.

[Lord Mendelsohn (Lab)]

My Lords—

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[Lord Price]

My noble friend asks an excellent Question and clearly one that many in the House want to rise quickly to ask further questions on. I am delighted to say that trade with the Commonwealth has grown sharply over recent years, in fact by about 10% a year since 1995. Trade with the Commonwealth stood at almost $700 billion last year and is projected to hit $1 trillion by 2020. Last week I am delighted to say that we had the inaugural meeting of Commonwealth Trade Ministers here in London, co-hosted between the UK and Malta. One thing that we talked about was the need to continue to have the very best movement of the brightest between Commonwealth countries to continue to build that trade. It is a point that the Secretary-General and the Commonwealth Secretariat will take away to work on with all 52 members of the Commonwealth.

[Lord Mendelsohn]

My Lords, I apologise for my enthusiasm earlier for this topic. I am sure that the whole House recognises and congratulates the noble Lord, Lord Marland, on his excellent work to organise the Commonwealth Trade Ministers’ meeting. When will the Government reply to his letter with an apology for claiming credit for organising it, as was outlined in the White Paper, when it was the Commonwealth that did so? Furthermore, do the Government understand that our chances of success in trade with the Commonwealth will be enhanced if we treat it as the modern free association of nations that it is, rather than as a British possession, as the incorrect claim seems to suggest to other Commonwealth nations?

[Lord Price]

I am delighted to put on record our thanks to the noble Lord, Lord Marland, for organising the first day of the two-day conference. I think the White Paper said that the conference was going to be held in the UK rather than it being organised by the UK. If it did not make that clear, my apologies once again. My noble friend did a wonderful job in bringing together 37 Trade Ministers from across the Commonwealth and we had very fruitful meetings.

On the noble Lord’s second point, the meeting drew out the fact that there are a wide range of economic opportunities and challenges across those 52 countries. Some are subject at the moment to GSP schemes from the EU, others have economic partnership arrangements, and a number have free trade agreements. All need to be treated differently so that we can achieve the best outcome for all 52 countries.

[Viscount Waverley (CB)]

My Lords, does the Minister agree that there is certainly a role for government, not least to create the environment to allow the private sector to thrive? However, UK industry and multipliers should be looking to partnership with their peers across the Commonwealth for corporate opportunities.

[Lord Price]

I very much agree with the noble Viscount that this is best handled on a business-to-business level. However, the Government have a role to ensure that we have the very best framework to allow businesses to prosper by trading with each other.

[Lord Purvis of Tweed (LD)]

My Lords, the United Kingdom currently enjoys free trade agreements with 32 out of the 52 Commonwealth countries by virtue of our membership of the European Union customs union. The Commonwealth Secretariat has said that if we leave that union and revert to World Trade Organization rules, such positive trading relations with those countries cannot be guaranteed, and not only that; the secretariat has also calculated that, on 2015 figures, the least developed Commonwealth countries would have faced $800 million of increased tariff payments to export to the United Kingdom if we were on WTO rules. Which part of that does the Minister agree would be, to quote the Foreign Secretary, “perfectly OK”?

[Lord Price]

The main point of our meeting last week with Trade Ministers from around the Commonwealth was to agree a smooth transition, whether there will be an association agreement, a GSP scheme, an EPA or even an FTA. As the noble Lord pointed out, there are a number of countries in the Commonwealth with which we currently do not have FTAs, or any agreement other than WTO. At the moment, we are on WTO terms with Australia, New Zealand, Canada, India and many others. We believe that in the new world all those can be improved to the benefit of the UK and the Commonwealth as a whole.

[Lord Anderson of Swansea (Lab)]

My Lords—

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[Lord Pearson of Rannoch]

My Lords, do the Government agree that the EU single market will continue in long-term and irreversible decline, whereas the Commonwealth contains many of the markets of the future?

[Lord Price]

I thank the noble Lord for his question. I am not able to predict the future of any part of the world, but I can say that the UK’s trade outside the EU has grown more quickly in recent years. Over the last five years or so it has grown by 6% inside the EU but by more than 14% outside it. We therefore feel very optimistic that in a new world of trading more powerfully individually outside the EU we can boost UK exports.

[Lord Anderson of Swansea]

My Lords, New Zealand, for example, is currently negotiating a comprehensive free trade agreement with the European Union. If, after Brexit, which will be at least two years hence, we also seek to have a separate free trade agreement with New Zealand, in what way will we benefit more than if we had remained a member of the European Union?

[Lord Price]

It is incredibly difficult to answer that question, because we do not know the shape of the EU agreement with New Zealand and what it will agree nor whether in fact it can do it within two years or whether it will take much longer. Equally, I cannot say today what the deal will be with New Zealand. The Prime Minister has announced a working group, which will begin in due time. I am confident that the UK will be in a position to strike comprehensive and beneficial trade deals for the United Kingdom.