Future Free Trade Agreements

Matt Western Excerpts

Thursday 21st February 2019 Commons Chamber

[Dr Fox]

I will make a little progress, because I know other Members wish to speak.

When we leave the European Union, an ambitious UK-US free trade agreement will be a key priority for the Department for International Trade, and we have already been laying the groundwork. The US-UK trade and investment working group has now met five times, with conversations focused on what both sides can do towards ensuring certainty and continuity for business on both sides of the Atlantic, and on identifying opportunities to facilitate bilateral trade and investment, consistent with the UK’s obligations as an EU member. Both the Prime Minister and President Trump have made clear their shared commitment to these bilateral discussions, and they restated that in their most recent meeting in July 2018. As US Ambassador Woody Johnson has said:

“Britain is the perfect trading partner for the United States.”

We very much welcome the letter of intent sent to Congress from the United States trade representative stating that the Administration intend to open a negotiation with the UK once we leave the EU. The President’s statement in the Rose Garden last week, pointing to a very substantial potential increase in UK-US trade, makes it clear that we already have a special trade relationship and that there is real ambition on both sides of the Atlantic to embrace this after we leave the EU.

[Matt Western (Warwick and Leamington) (Lab)]

Let me come back to a point about UK-US trade. The Secretary of State will be well aware that so many US corporations have favoured UK membership of the EU because it has given them a bridging point in access to the EU. The US Chamber of Commerce in Europe, for example, has long favoured our staying in Europe. Does he not agree with that?

[Dr Fox]

A lot of US corporations that I speak to are very relaxed about what our relationship with the EU will be, not least when I explain to them the constitutional implications of Britain being in the EU. I say to my American colleagues, “How would you like to have a court that has authority over the Supreme Court but that sits in Ottawa or Mexico City and over which you have no control?” They then soon understand the constitutional reasons why many of us voted to leave the EU.

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[Catherine West]

I thank the hon. Gentleman for his intervention and for his leadership of the Select Committee. It is a very interesting Committee that he manages very well, given the breadth of views among its members.

I have a further point to make on TTIP, or what I call trip-up. Many of the TTIP proposals were quite anodyne, but they were politically mishandled. When the Select Committee visited the US Senate and the House of Representatives, the famous Democrat John Lewis said to us that had labour rights been raised much earlier in the discussions around NAFTA, there may not have been quite the problems that arose when Mr Trump first became President. Had labour rights been much more at the forefront and given much more scrutiny, and had everything been much more open and debated much more freely, perhaps messes might not have been got into. That applies to TTIP or any form of agreement. Any sense that the public are being kept out, that it is secret or that the trade unions or civil society groups are not involved can lead to a trip-up.

[Matt Western]

My hon. Friend is making some important points. I am sure that she will agree that one of the great lessons that we have learned through the Committee is that the EU approach—and the approach of countries such as Australia—of involving civil society and other groups ensures that, when it comes to setting the agenda for any negotiation, those points are very much on the table and are clear.

[Catherine West]

I agree, particularly in relation to some of the really sensitive things such as human rights. We are represented at an EU level, which means that we have our MEPs there in the room. Equally, though, very sensitive discussions can be held on our behalf, without our personally having to make a comment. Perhaps the Secretary of State for Defence might have appreciated a bit more “arm’s length” recently, especially when he was asked in a rather cheeky way yesterday by an interviewer on the radio whether he should button his lip. Again, we have to learn diplomacy if, indeed, Brexit happens and if, indeed, we end up having an independent trade policy. We cannot just go round opening our mouth and saying what we like.

I wish briefly to talk about an element of our future arrangements with Australia. I am not talking so much about the goods side. On agriculture, as those of us on the International Trade Committee know, Australia does not currently meet its quota for the Asia market—Asia in this case is the far east—and so that is less of an issue for our own agriculture here in the UK. However, there are areas around services—for example, equivalence on education, diplomas and degrees—where an already healthy relationship could be enhanced by improving mutual recognition of degrees, diplomas and professional standards. As the Secretary of State and the shadow Secretary of State have said, some of these things will be easy wins.

I will briefly touch on developing countries and fair trade. Many of us are very optimistic that more can be done in this area. I would be very grateful if the Minister, in his closing remarks, talked about how leadership can be shown in intra-Government and intra-country arrangements. For example, he will be aware that coffee in some African countries comes to Europe to be prepared and is then exported back at a higher price to Africa. Perhaps opportunities exist there to erase some of that cost by ensuring that those products can be much more effectively consumed locally and by ensuring that they do not have to come via Europe. African nations should be able to do that themselves and have their own trade agreements.

We are in a very difficult national position. Geopolitically, it is not a great time to be starting a big free trade discussion. The situation in the EU has its instabilities as well, with the upcoming elections this spring possibly producing more member states who have an aversion to free trade.

With regard to the US—one of the purported wins on free trade—there are many question marks on future business, particularly given some of the more protectionist statements by the President. In China, we are seeing a changing internal situation, which is having an effect on big infrastructure decisions. China is also possibly overstretched on the Belt and Road initiative. Some commentators suggest that some of these huge infra- structure projects may be overstretching China’s reach to some degree, which means that entering trade agreements in the current climate may be quite difficult. Similarly with Japan, there is a need not just for Ministers, but for Whitehall to have another look at preparedness for a very big challenge.

Once things calm down, it would be helpful if we could find some way of looking at how prepared the Foreign and Commonwealth Office, the Department for International Development, the Ministry of Defence and all the different silos are and consider how they could work more effectively together. Such a review exercise could gain a lot of traction and help us to achieve a more slimline approach—not so much to do with people; more to do with a greater sense of direction. I suspect that that lack of direction comes from the different Departments. Furthermore, the reduction in the number of language experts in the Foreign Office, and in expertise in some other Departments, needs to be reviewed. I am sure that the Minister will mention that in his closing remarks.

[Matt Western (Warwick and Leamington) (Lab)]

It is very disappointing to see how few Members are present in the Chamber today—that applies to the Benches on both sides of the House, but certainly to the Government Benches. I have a lot of respect for the Under-Secretary of State for International Trade, the hon. Member for Beverley and Holderness (Graham Stuart), and I am sure that he, too, is disappointed that a topic of such importance should actually have attracted so few people to the Chamber today.

Today’s debate honours the Government’s commitment that was made back in the summer to hold a debate on these future trade agreements, but it does not provide for the much-needed debate on the Government’s outline approach on an amendable, substantive motion, as proposed by the International Trade Committee in our report on trade policy transparency and scrutiny, which is disappointing. It seems that the Government’s conduct of marginalising Parliament in the process of Brexit is evident once more—so much for taking back control. As the Committee stated, handling trade negotiations is the prerogative of the Executive, but there must be a meaningful role for Parliament in the trade policy process.

The Committee has been absolutely clear that trade policy needs to be open and inclusive, maximising the benefits across and throughout the UK; that Government must operate from a presumption of transparency; and that consultative processes must be formalised. Specifically, the Committee was interested in the role that Parliament, the devolved Administrations, local government, businesses and civil society should have in the process—all elements that are included in Labour’s policy on trade deals. However, it would seem that the Select Committee report is being ignored.

Since his appointment, the Secretary of State for International Trade has asserted a great many things: in July 2017, we were told that a deal with the EU would be the easiest in human history, and in December 2017 he stated that the 40 free trade agreements covering 55 countries could be rolled over a second after the UK left the EU. A couple of months earlier, Lord Price, the then Trade Minister, told us that there were 36 FTAs with 60 countries, and he said that they could simply be cut and pasted and that that had almost been done. It was not until the Select Committee was told by Professor Andreas Dür that there were in fact 41 free trade agreements covering around 70 countries—a figure confirmed by the Financial Times—that we absolutely knew where we were. As suspected, the notion that free trade agreements could be rolled over has not proved quite as easy as the Secretary of State originally claimed. Although not central to this debate, that does illustrate the huge challenges that we will face.

Just two weeks ago, the Secretary of State came before the Select Committee to face questions, and it was quite clear that rolling over these agreements was not really going that well. Despite his considerable obfuscation, the reality of the state of the deals was evident from the Secretary of State’s own briefing note. Anyone in the Committee Room could see that on the piece of paper in front of him there was a huge amount of red, a little bit of orange and very little green. Under that green, amber and red traffic light system, the status of these free trade agreements was quite clear. When the Secretary of State was challenged on that point, he claimed colour blindness, yet hours later in the afternoon he was more forthright with business leaders—sadly not with us. It was yet another example of keeping Parliament in the dark.

[Angus Brendan MacNeil]

On that idea of keeping Parliament in the dark, if the UK and the EU were to enter into a trade negotiation, European parliamentarians would know more than Members of the House of Commons, and our best way of finding out what was happening would be to ask our friends from Ireland. Far from us taking back control, the European Parliament would actually have more control in that particular trade negotiation, which is a supreme irony of the whole Brexit carry-on.

[Matt Western]

I thank the hon. Gentleman for his chairmanship of the International Trade Committee, which he does so well, and for the important point that he has just made. One senses that we are being kept in the dark, that there is there is far greater transparency on the EU side, and that we will probably end up learning more from the EU and other countries about how our deals are progressing. The Select Committee has actually found that to be the case when we have visited Geneva, Brussels or elsewhere; we are discovering the reality from trade ambassadors in those other countries.

[Dr David Drew (Stroud) (Lab/Co-op)]

I am very much enjoying my hon. Friend’s speech. It is not just that we seem to be in the dark about our relationship with the EU; Ministers also seem to be in the dark from one another. For example, the Chancellor has said that they he does not want any tariffs on food because he wants to keep food prices down, but in today’s Environment, Food and Rural Affairs questions the Farming Minister gave a very long answer about how DEFRA is looking at tariffs, quotas and various other restrictions. It is not very good if Government Departments cannot even talk to one another, is it?

[Matt Western]

My hon. Friend makes an important point, which I was going to come to later in my speech. He is quite right that the Government are kind of fudging the situation along, and no one is absolutely clear how these things will be managed. Our rural and farming communities will be extremely concerned because, having been so dismissive of the common agricultural policy, it is absolutely not clear how we are going to manage our all-important farming and agricultural sector post Brexit.

I was talking about the free trade agreements and the discussions of the Select Committee last week. It has subsequently become clear that the situation is a real mess. The status of the deals has been leaked and we now know that just five have been agreed, nine are off track, 19 are significantly off track, four are not possible to complete by March 2019 and two are not even being negotiated. So much for colour blindness—perhaps it is more of a blind spot.

In the case of the five deals that have been rolled over, their lack of priority and importance is perhaps self-evident. The Faroe Islands, which were mentioned earlier, are the UK’s 114th largest trading partner—critical, then—and account for 0.1% of total UK trade. Clearly we buy a lot of fish from them. Then there is Chile, our 65th largest trading partner, which also accounts for 0.1% of total UK trade. The eastern and southern African region accounts for £1.5 billion and another 0.1%. Switzerland and Israel are the only countries that are bringing deals of the scale that we would have expected earlier in the process. Perhaps most concerning are the agreements with South Korea and Japan, which are way off track, and the lack of diplomacy is only hampering them.

It is clear that the Secretary of State and his Department favour securing deals with Anglosphere countries—the US, Australia, New Zealand and Canada being prime among them. The US is a major market, but so is the EU. Perhaps it is the appeal of another strong and stable leader that is driving the Prime Minister and her Secretary of State to prioritise a deal with the US. Elsewhere, of course it would be good to have better deals with Australia and New Zealand, but is it not more sensible to prioritise the customers on our doorstep? When I did a paper round, I always thought that it was better to do the paper round on my own street, rather than on the other side of the village; maybe I am wrong.

The public should not be fooled into thinking that this will be over by 2020 or 2021. As we have heard, these deals will take six to 10 years to negotiate. This will not be easy. The EU-CETA deal took six years. That is typical, and we have heard from trade negotiators, trade lawyers and those involved in other countries just how difficult this will be. The public need to know, as do those in our industrial and business sectors. The US is a great country, but it is an even better trade negotiator. In trade deals, as in any business deal, size matters, and since the election of President Trump we have seen a new approach that favours the bilateral agreements that he prefers. That puts the US at an immediate advantage. Hence, NAFTA was redone. The Select Committee happened to be over there back in the spring of 2018, and the anxiety was palpable among the Canadian negotiators about what that would mean—but not just among them. It was palpable among US exporters and the car industry, as we heard earlier.

Perhaps naively, or perhaps because it is the outcome that the Secretary of State favours, we will face the mother of negotiations when our people sit down in Washington, and we should be under no illusion as to what the US will want to trade on. It will be services and cars, traded for agriculture and healthcare. We should remember the issues from the negotiations on the now-abandoned Transatlantic Trade and Investment Partnership, otherwise known as TTIP. Foremost among the public’s concern was the threat posed to our precious health service from a possible corporate takeover in any form. That deal, lest we forget, was being negotiated between the EU and the US, virtually equal-sized economies.

I have nothing against the US. In fact, I love the US, but I love the NHS more, and I am suspicious of the strategy of the Government and the Secretary of State. I have nothing against him personally, but let us be honest, he was the founder of the Atlantic Bridge, and his motivations and intentions have always been clear.

Like so many of my constituents, I fear not just for our health service but for our excellent, world-leading car manufacturers, local farmers and all those involved in our agri-food industry. None of those working in that sector should be under any illusion that they will be safe in a trade deal that the Secretary of State will seek urgently and desperately to secure in order to preserve the Government’s position. Without doubt, financial services will be his priority.

Our farmers should also be concerned by what concessions are likely to be made in the trade deals elsewhere, especially in the trade of livestock. Likewise our fisheries. Just last week, there was disagreement between the Secretary of State for Environment, Food and Rural Affairs and the Secretary of State for Business, Energy and Industrial Strategy, and that was echoed this morning, as we have just heard, in the comments about who would subsidise our farmers in those circumstances should we leave the EU. While both Australia and New Zealand have much to offer, their markets are still a small fraction of that of the EU, and the Secretary of State should be clear about that. By my estimation, trade with the EU is 30 times the combined trade that we do with New Zealand and Australia.

By contrast, the comprehensive and progressive agreement for trans-Pacific partnership has considerable scale. Naturally, its members comprise the nations around the perimeter of the Pacific, which will benefit from free trade in that sphere. I struggle to see how it will benefit or be appropriate to the UK. Call me old-fashioned, but doing business locally was always easiest and remained the priority. That seems no longer to be the case. Of the countries involved, our trading negotiations with Japan and South Korea are the most critical—far more so than those with Australia or New Zealand. In conversations with Japanese and Korean investors, it is clear how concerned they are by Brexit.

At an event in October last year held by the Japanese Chamber of Trade here in Parliament, its chief executive made it clear to those present, including the Secretaries of State for Business, Energy and Industrial Strategy and for Transport, that Brexit would seriously affect its businesses and investments in the UK. Spring forward three months, and Nissan has cancelled its investment in Sunderland, Honda has announced the closure of its plant in Swindon with the direct loss of 3,500 jobs, and Hitachi has cancelled its investment plans for a nuclear station in Anglesey. A clear pattern is emerging.

Let me return to the question of priorities—let us call them business priorities. Surely our priority must be to secure our existing trade in inward investment. I do not understand why the Government seem so relaxed about walking away from their biggest customer and in the process damaging existing relations and undermining both domestic and foreign direct investment.

[Angus Brendan MacNeil]

The hon. Gentleman has mentioned Japan. Does he think that the lack of concern that has been shown for Japanese interests in this whole Brexit farrago will not serve the UK very well when it comes to negotiating a trade deal with Japan? The list of companies he gave and the concerns that the Japanese have raised have not registered or led to any deviation in UK policy, and it is understandable that the Japanese feel quite slighted, given their interests and that 40% of their EU investments were on island UK.

[Matt Western]

I thank the hon. Gentleman, whose constituency name I always get wrong—the Outer Hebrides—for his important point. It is not until we actually talk to investors and their representatives, and to major corporations that have given so much prosperity to these islands over the last 30 or 40 years, and consider how they feel—he used the word “slighted”—that we realise that respect is such a critical part of the culture in Asia. It is absolutely clear that they feel disrespected in this process and that we have not approached them and engaged with them sufficiently well. The Government may well have done that to an extent, but the fact that we are now seeing this haemorrhaging of investment from the UK underlines how seriously that is felt. At that reception held by the Japanese embassy in October last year, attended by the Secretaries of State for Business, Energy and Industrial Strategy and for Transport, the words of the chamber’s chief executive were chilling. He said, in summary, about Brexit, “We will be watching you.” Never have so few words concerned me so much.

I cannot help but conclude that this country is being seduced by a prospect of some sort of brave new world—empire 2.0, perhaps—when, in reality, the existing world in which we trade is both stable and prosperous, no matter the present headwinds. Actually, I agree with the Secretary of State for International Trade that we could be performing better in Asia Pacific markets, but I disagree with him on his solution. How can it be that, as I have said previously in this place, German exports to China are 10 times those of the UK? Germany is part of the EU, is it not?

Sometimes, we—the UK public—have bought the lie that being a member of the EU has held us back in international trade. It has absolutely not. To be fair to someone I did not necessarily agree with, Margaret Thatcher recognised that and recognised the importance of the EU. As was said by my hon. Friend the Member for Swansea West (Geraint Davies), who is no longer in his seat, it is perhaps the greatest irony that she would have sought to protect our membership of the EU single market, of which she was the architect, recognising its importance to businesses based here, and particularly the Japanese companies she persuaded to invest here, such as Honda and Nissan. She will be turning in her grave.

I remain convinced about and committed to protecting our market and our businesses, and our jobs that they provide. Likewise, I am concerned for our farmers and those in the south of my constituency around the villages of Barford, Bishop’s Tachbrook, Hampton Magna and Norton Lindsey, who I believe will be seriously damaged by the industrial-scale farming they will be forced to compete against in future.

I also remain convinced about and committed to the EU market. Surely it provides greater certainty than the prospect of being caught up in the crossfire of the US-China trade wars. The truth is that, whether it be the uncertainty of negotiating with the current President of the United States or the significantly smaller markets presented by Australia and New Zealand, the priorities claimed by the Secretary of State are far removed from the certainty of the EU market. We should be wary of where we are going.

[Dr Drew]

I thank my hon. Friend for giving way again. Does he accept that one sector that is particularly vulnerable is the pig sector? American exports to China have all but come to an end and the Americans are desperate to find another market that they can populate with their pigs. The obvious one is the UK. Would not that be a real threat?

[Matt Western]

I thank my hon. Friend for his well-informed intervention—he clearly knows a huge amount more about the pig farming sector than I do. The subject did come up in conversations in the United States and subsequently of the opportunities not just for pig farmers but for soya bean agriculture, and how keen the US is to export those products. We have to be cognisant of what that will mean. As has been said many times this afternoon, this is about concession, trading terms and what we are most prepared to give way on, but I am particularly fearful of the impact on our rural communities and on the farming sector, whether it be the pig farmers or others.

In considering future deals, it is essential in any event that there should be scrutiny from Parliament. That has come through loud and clear in the evidence that our Select Committee has taken: we should involve not only Parliament, but the devolved Administrations, civil society groups, representative business bodies and the unions. We need economic impact assessments, undertaken and shared with the relevant bodies—in particular, Parliament and the Administrations. That approach would ensure transparency and is best exemplified by that followed in the EU’s process, but also by the US itself. We also need to ensure the protection and maintenance of workers’ rights and environmental protections—certainly in our farming and rural sector—and to oppose the use of investor-state dispute settlement mechanisms in future agreements.

Finally, in leaving one of the most sophisticated, most advanced markets that is the EU, we must not allow this or any Government to reduce standards or protections. First and foremost, we must be determined to ensure that our manufacturing industries and farmers receive the appropriate protections they deserve, not the 0% tariffs on imports that the Secretary of State is advocating.

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[Chi Onwurah]

I thank the hon. Gentleman for that intervention, but let us be clear. He gives the example of wine—we are not huge producers of that in Northumberland—and fruit, but I am talking about lamb, sheep and the other products of small-scale farming in the highly temperate climate that drives our beautiful, natural landscape. That is what I want to continue.

British farmers have been able successfully to compete on both quality and price in markets defined by EU food safety rules. For example, British farmers export far more wheat flour to the European Union—approximately 250,000 tonnes last year—than they do to non-EU countries, at approximately 6,000 tonnes, and the same goes for other agricultural products such as barley and oats. The EU is the largest importer and exporter of food in the world, and as part of an EU member state, our farmers have benefited from preferential access to that market through exemptions from the tariffs and quotas that are imposed on non-member countries, and without dropping our environmental and farming standards.

With 85% of seasonal agricultural workers in the EU coming from Bulgaria and Romania, agriculture is one UK sector dependent on freedom of movement. The immigration Bill will clearly do nothing to enable the continuation of what the Government are pleased to call “low-skilled” workers—those who earn below £30,000— but what about the Agriculture Bill? Will it protect our small farmers? It does nothing to address concerns about competition, and it places no duties on the Secretary of State for Environment, Food and Rural Affairs. It offers no funding and no environmental safeguards. The Government are showing yet again that they are not prepared to deliver a farming environment that protects our environment as well as the standard and quality of our food.

Our automotive sector is a global success story, although, as we saw in the sad announcements from Honda and Nissan, it now faces challenges due to technology, climate change and Brexit. It is clear that this is not all about Brexit. As I said, there is technology and there is climate change. However, the automotive sector is one of the most competitive and highly integrated industrial sectors. When there is one disabling factor that is a unique disadvantage for UK producers—Brexit is a unique disadvantage for UK producers—we are more likely to lose in the competition for future investment. The inability or the decision of this Government to not take a no-deal Brexit off the table means that our investment is falling.

[Matt Western]

My hon. Friend not only beautifully illustrates the north-east of England, but she is making very important points about the farming community and the automotive industry. On Honda’s announcement, this is the first car plant it will have ever closed in its entire 71-year history. That is not coincidental. Brexit is, as she says, just one element, but when working with such thin, narrow margins in such a competitive sector, it is what triggers the review and subsequent decision to disinvest.

[Chi Onwurah]

I thank my hon. Friend for that excellent point. The competitiveness of the sector means that margins are narrow, so any such factor—Brexit and access to markets are significant factors—will place us at a continued disadvantage. The Society of Motor Manufacturers and Traders says that no deal could cost the car industry up to £4.5 billion in tariffs.

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[Chi Onwurah]

The Minister knows very well that the business organisations that have said that to me—I speak to them extensively as a shadow Minister—do not wish their names to be given. [Interruption.] They have said it. They do not wish to be named in Parliament, because they fear the negative reaction of Ministers such as himself.

[Matt Western]

Very simply, the reality is that this is not just about no deal. Businesses, the manufacturing sector, the CBI, the Federation of Small Businesses and all the others are saying that they would prefer for us to stay in a customs union and a single market. That has been the Labour party position since February last year. It is absolutely clear. That is where the manufacturing sector wants to stay. The CEOs of Jaguar Land Rover, Airbus and others all want us to stay in a customs union and a single market.

[Chi Onwurah]

I thank my hon. Friend for that important point. Many organisations, such as the Manufacturing Trade Remedies Alliance, have explicitly come out against the Government’s deal and repeatedly said that they want a customs union. That is an implicit criticism of the Government’s deal.

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[Chi Onwurah]

I thank my hon. Friend for that intervention. I had not seen the last set of quarterly figures. I hope that in the annual figures, we are still exporting more than we import, but that is testament to the fact that manufacturing is not safe in Tory hands. In particular, manufacturing would be devastated by a Tory Brexit. The Honda announcement was devastating for families and friends of the employees there and we do not want to see any more announcements like that.

The thing that really upsets me is when the Tories claim that to take a no-deal Brexit off the table would be like someone telling a car dealer that they were not willing to walk away. With Brexit, we are not trying to buy a car in a car dealership. We are trying to build cars across the European Union that will deliver good jobs. Choosing to leave a no-deal Brexit on the table is an act of unparalleled economic sabotage by this Government.

[Matt Western]

To highlight the point my hon. Friend is making so well, has she heard and was she as appalled as I was by the comments made by Matthew Lesh of the Adam Smith Institute a couple of weeks ago on the radio, that this is all about free markets, liberalising trade, 0% tariffs, competency and competitive advantage, and if we lost our manufacturing industry in the process of achieving that, so be it?

[Chi Onwurah]

My hon. Friend raises a very unpleasant memory for me of when, as an engineering student at Imperial, back in the ’80s, I heard Margaret Thatcher say that the UK was going to be competitive on the global stage in finance and other services, and the rest of the world could be our manufacturer. The consequences of the lack of support for manufacturing from successive Conservative Governments are seen in the average wages of our constituents, day in, day out.

I want to talk briefly about negotiating power. The car buyer fallacy is not the only Tory fantasy; the idea that we will do so much better in trade negotiations on our own than with the collective power of the European Union is a total fantasy. The Secretary of State said that on our own, we would be nimble, negotiating deals the clunky 27 could not, such as with the United States. European Union gross domestic product is seven or eight times greater than that of the UK, so it offers greater opportunity for profit. Any trade agreement that delivers 1% improved profitability with the European Union would have to do seven times better with the United Kingdom to be as attractive. The Government are arguing that in the margins of the differences between ourselves and other EU members, without damaging environmental standards or working rights, we will be able to deliver seven times the benefits to any trading partner. That is a fantasy we will pay for.

African and other Commonwealth countries are not part of this debate, but the Secretary of State spoke quite extensively about them in his opening speech. One of the many disingenuous—indeed, deceptive—ways in which the leave campaign sought support during the referendum campaign was to promise better immigration and trade opportunities for Commonwealth and African countries in an attempt to draw in Commonwealth and African diaspora citizens to voting leave. Well, the £30,000 salary threshold for skilled immigrants shows clearly that there are to be no greater immigration opportunities for people from Commonwealth and African countries.

As chair of the all-party parliamentary group for Africa, I know how important trade is to African countries. The subject is raised regularly with me by incoming delegations. It is true that the economic partnership agreements between the European Union and African nations are flawed because they lack transparency and because they limit scope for African Governments to make their own development choices and industrialisation plans, but many—indeed, most—African nations see the UK as the entry point to European Union markets, and they are at a loss to understand why we are abandoning the world’s greatest free market area. What they seek is continuity and fair access to our markets, and clearly this Government can offer neither.

In the almost three years since the Brexit vote, we have learned much more about what Brexit involves and what the choices are. Now it is clear that all forms of Brexit involve an economic hit, but this Government’s Brexit trade policies and, in particular, leaving no deal on the table are a form of economic sabotage, and that is something to which I will not be a party.

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[Bill Esterson]

The leave campaign pushed the point rather hard about Turkey’s accession to the EU.

My hon. Friend the Member for Bishop Auckland (Helen Goodman)—this is the bigger point about the Secretary of State’s involvement—spoke about the failure to ensure, when the EU-Japan deal was negotiated, that there was support for the foreign direct investment and its critical place in our car industry, whether at Honda or Nissan. The Secretary of State’s answer is that he will not change his approach in the future trade deals he negotiates once we have left the EU. That is a pretty grim predictor of what is going to happen under this Secretary of State and his colleagues in their support—or rather lack of it—for our industry, our manufacturing industry and our car industry in particular.

[Matt Western]

I mentioned Margaret Thatcher earlier. If she were still around today, she would not settle for Honda leaving the UK. She would fight with every fibre in her body to defend our interests in retaining that important business in the UK. Does my hon. Friend agree?

[Bill Esterson]

We have come to an interesting point, with Labour Members citing Margaret Thatcher and the fact that she founded the single market of the European Union to demonstrate just how wrong the current Government, who claim her inheritance, are in their international trade policy.

I have taken a number of interventions and I am very cognisant of your strictures for me to keep things to a minimum, Madam Deputy Speaker. As I was saying, the alternative is to deliver certainty. That alternative can come with a new customs union and a deal with the single market on regulations, standards and common institutions that protects our trade with the EU and with our partners around the world. The difficulties in renegotiating the deals with our partners have been laid bare in recent weeks by the failure of the International Trade Secretary to make progress on more than a handful of such deals, quite apart from the uncertainty over our future trading relationship with the EU. He wants to align with lower standards from the US.