UK-Turkey Free Trade Agreement

Nigel Huddleston Excerpts

Wednesday 8th November 2023 Written Statements

[The Minister for International Trade (Nigel Huddleston)]

On Thursday 2 November, the Department for Business and Trade has launched a public call for input on an upgraded free trade agreement between the United Kingdom and Turkey. The call for input can be accessed via the following link:

https://www.gov.uk/government/consultations/trade-with-turkey-call-for-input

The UK is committed to enhancing our existing trade relationship with Turkey, a dynamic and rapidly modernising economy that is expected to be the 12th largest in the world by 2050 and the fourth largest in Europe. The UK and Turkey are the two major powerhouse trading economies at each edge of the European continent and our current trade is valued at £23.5 billion.

Our current FTA, signed in 2020, replicates the effects of various outdated agreements between the EU and Turkey from the 1990s. It only covers goods and is not tailored to the strengths and demands of our modern economies. We want to establish a modern, 21st-century agreement tailored to the evolving economies of both nations to cover crucial sectors, including digital trade and services.

Over 7,500 UK companies already export to Turkey, including well-known brands such as Vodafone, HSBC and Dyson. Turkey’s thriving tech, manufacturing, transport and infrastructure sectors have generated a surge in demand for international expertise in areas such as digital technology. This is an opportunity to negotiate an upgraded FTA that is aligned more closely with the interests and priorities of British businesses than our existing provisions and positions them advantageously for future opportunities.

The call for input, which will run for nine weeks, will offer businesses, individuals, and other interested stakeholders the opportunity to provide valuable feedback and highlight their priorities for our future trading relationship with Turkey.

The input gathered from stakeholders will play a pivotal role in defining our mandate, guiding comprehensive negotiation preparations, and shaping our policy positions. The Department for Business and Trade is dedicated to ensuring that our final approach benefits the best interests of the British economy.

In all of our trade negotiations, we will not compromise on our high environmental protection, animal welfare and food safety standards. Protecting the NHS is a fundamental principle of our trade policy: the NHS, the price it pays for medicines and its services are not on the table.

Next steps

Prior to launching negotiations, the UK Government will publish their approach to negotiations. This will include a response to the call for input and our strategic objectives, as well as an economic scoping assessment. The Government are committed to transparency and will ensure that Parliament, the devolved Administrations, UK citizens and businesses are kept regularly updated on negotiations.

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Draft United Kingdom Internal Market Act 2020 (Services Exclusions) Regulations 2023

Nigel Huddleston Excerpts

Wednesday 25th October 2023 General Committees

[The Minister for International Trade (Nigel Huddleston)]

I beg to move,

That the Committee has considered the draft United Kingdom Internal Market Act 2020 (Services Exclusions) Regulations 2023.

The statutory instrument, which was laid before the House on 20 July, will help to ensure that seamless internal trade is maintained for the shared prosperity and welfare of people and businesses across the nations of the United Kingdom. It will enable effective operation of services regulations in the United Kingdom by adding, amending and removing service sectors excluded from the market access principles in part 2 of the United Kingdom Internal Market Act 2020. I will cover both the purpose and the impact of the instrument, starting with the former.

The UK internal market plays a vital role in maintaining equality of opportunity and certainty for businesses, no matter where they are in the UK. It does so by ensuring that there is an internal market in which the free flow of goods and services is protected across the whole United Kingdom. The UKIM Act was introduced to preserve the United Kingdom’s internal market as powers previously exercised by the EU were returned to the UK. The Act establishes two market access principles—mutual recognition and non-discrimination—in relation to goods and services.

The principle of mutual recognition means that service providers, such as businesses, that meet authorisation requirements to provide their service in one part of the UK can provide their service in other parts of the UK without having to comply with any additional authorisations or requirements.

[Sir Greg Knight (East Yorkshire) (Con)]

Paragraph 3.2 of the explanatory memorandum produced by the Minister’s Department states:

“Welsh Ministers consented to the instrument. However, consent from all Devolved Governments has not been provided within the period of one month…the Secretary of State may make the instrument without that consent.”

Could the Minister tell the Committee why that consent was not forthcoming? Was it to do with opposition to any part of the policy, or was it more to do with incompetence?

[Nigel Huddleston]

I thank my right hon. Friend for that comment. I am not here to speak on behalf of the devolved Administrations, but he is correct. I will come on to legislative consent in a moment. It is probably not unusual. I will not speak on behalf of the SNP but I understand that, while we have been co-operating and engaging with the devolved Administrations throughout, some of the opposition is more to do with the broader aspects of UKIM than the specifics of this statutory instrument. I will return to that in a few moments.

The other market access principle, the non-discrimination principle, prevents service providers from being discriminated against based on where they are in the UK. For example, if a regulator were to require a service provider to pay a higher fee because they were from another UK nation, that would be discriminatory.

The Act’s market access principles will apply only to new or substantively amended authorisation or regulatory requirements for providing services introduced after 31 December 2020. For example, a new licensing requirement for accountancy services would be in scope of both the mutual recognition principle and the non-discrimination principle of the UKIM Act if it were enacted on or after that date. However, service sectors listed under either or both parts of schedule 2 on services exclusions related to mutual recognition or non-discrimination are not in scope of those market access principles. Additionally, the market access principles do not apply where the requirement is a response to a public health emergency or has a legitimate aim, as set out in the Act.

There is a power under section 18(2) of the UKIM Act to amend schedule 2. During the Act’s passage, the Government committed to review and further develop the list of services exclusions after the Act received Royal Assent. That commitment was made because the list in schedule 2 is mainly based on exclusions in the most relevant pre-UKIM Act regulatory framework, the Provision of Services Regulations 2009, which is retained EU law. The exclusions in schedule 2 were therefore based on the sectors originally excluded with intra-EU trade in mind, rather than intra-UK trade.

In February 2021, the former Department for Business, Energy and Industrial Strategy publicly consulted on whether the existing service exclusions were fit for purpose in a post-EU exit context. The consultation had three main aims: first, to establish whether there were any instances in which regulators had previously disapplied the existing mutual recognition requirement to recognise authorisations under the previous retained EU law; secondly, to establish whether any other changes needed to be made to the services excluded in schedule 2 to better reflect the UK’s circumstances post EU exit; and thirdly, to ask for any other ways in which the internal market for services could be further strengthened.

Following the Department’s assessment of the consultation responses, including engagement with other Departments and the devolved Governments, this technical statutory instrument will make the following changes. First, it will add exclusions from the mutual recognition principle for services for the supply of gas, electricity and water, sewerage and waste sector services, services for the construction and operation of heat networks, and qualifications-awarding services. The change will mainly reflect how those sectors currently operate. The exclusions will maintain the status quo in areas where mutual recognition was not already in operation to reflect long-standing regulatory arrangements in the UK.

Without those exclusions, for example, regulators in the gas and electricity supply sector would not be able to regulate as they have done previously, as they would have to accept authorisations from another part of the UK. Evidence from the consultation responses highlighted that that could have a harmful impact on those sectors, causing consumer protection and public safety issues, due to the different standards and systems in parts of the UK. Not making those modifications to the existing exclusions schedule could also lead to higher regulatory costs, as it could instigate market framework changes that industry is not prepared for.

Secondly, the SI will amend the existing exclusion relating to social services. The change will not alter the scope of the exclusion, but will provide clarity that it applies to children’s social care and childcare services provided by both public and private providers.

Finally, the SI will remove the existing exclusions for financial services, electronic communications services, statutory audit services, postal services and services of temporary work agencies. Our view is that exclusions are not needed in areas where the UKIM Act market access principles will have little to no impact on how a service is actually regulated or provided in the UK because the sector is either reserved or already operates on a UK-wide basis. Removing the exclusions and making the services in question subject to the mutual recognition and non-discriminatory principles should have little impact on how they are provided in the UK. Details on these changes can be found in the Government response to the consultation, published in July 2022.

My officials have worked collaboratively and transparently with the devolved Governments and their counterparts on this policy over the last two years. I thank the devolved Governments for their engagement and for sharing the public consultation with their stakeholders. We received responses from stakeholders operating in Scotland, Wales and Northern Ireland, and we have continuously engaged with Ministers and officials in the devolved Governments on the proposals. We adapted the policy based on their feedback in cases where the evidence supported the changes and the integrity of the UK internal market was not undermined.

We sought the consent of the devolved Government Ministers to this instrument, as required under the Act. We have not received consent from the Scottish Government or Northern Ireland, but I am happy to report that the Welsh Government provided formal legislative consent. Under section 18(10) of the UKIM Act, the Secretary of State may make the instrument without consent from all the devolved Governments so long as an explanatory statement is published to state why they are proceeding without such consent. The Secretary of State for Business and Trade published a written statement on the Parliament website on 20 July—the same day this instrument was laid—explaining why the changes are being made without consent from the Scottish Government or the Department for the Economy in Northern Ireland.

Following an extensive public consultation and engagement process, I can assure Members that the instrument will ensure that the services exclusions in schedule 2 to the UKIM Act are appropriate and effective. The changes reflect how these services are currently provided and regulated in the UK. I commend the draft regulations to the Committee.

--- Later in debate ---

[Nigel Huddleston]

I should say, Ms Elliott, that it is a pleasure to serve under your chairmanship for the second time.

I thank hon. Members for their contributions to the debate. Revisions of the UKIM Act, as we have just seen, naturally bring up historical opposition, for reasons that I think we all understand, but I hope that the regulations will be considered on their own merits in relation to protecting the UK internal market. As the hon. Member for Gordon mentioned, there has been constructive dialogue, which is much appreciated, and there have been changes to this SI as a result.

This instrument is a direct result of a public consultation, and therefore a rare amendment to the exclusions list, following the intention to make the scope of the UKIM Act better to support intra-UK trade. I trust that hon. Members recognise the need for the instrument, and I assure the Committee that the Government are more committed than ever to facilitating a workable system of domestic services trade that achieves our strategic business and trade objectives. We believe that the instrument will foster exactly that outcome, making the internal market arrangements for the UK services sector simpler and more workable in a post-EU context.

I will endeavour to pass on the message that the hon. Member for Gordon asked me to pass on next time I have a brush-by with the Prime Minister, or perhaps he can do so himself—but that is probably straying slightly beyond the scope of the regulations. I thank hon. Members again for their contributions and commend the regulations to the House.

Question put and agreed to.

UK Trade Negotiations: Switzerland and Canada

Nigel Huddleston Excerpts

Tuesday 17th October 2023 Written Statements

[The Minister for International Trade (Nigel Huddleston)]

Trade Negotiations Update

Since the House adjourned for conference recess, the Department for Business and Trade has made good progress on two key trade negotiations. This statement provides Parliament with an update on the UK’s trade negotiations with Switzerland and Canada.

UK-Switzeriand Trade Negotiations

The second round of negotiations on a UK-Switzerland enhanced free trade agreement took place from 18 September to 6 October.

During the round, which was virtual, UK officials held discussions with their Swiss counterparts across all negotiation areas. The talks were technical in nature, focusing on trade policy priorities for both countries and in a number of chapters, supported by draft treaty text. This has enabled further progress in identifying areas of alignment. Discussions continue to be constructive and collaborative, with both sides agreeing next steps to ensure further progress at round 3, which is scheduled for later this year.

These negotiations demonstrate our shared ambition to agree a modern, comprehensive agreement that reflects the current and future UK-Swiss trade relationship.

The UK is working to negotiate an agreement that delivers modern services and investment provisions, while further removing tariff barriers to create mutually beneficial commercially meaningful opportunities for our world-class producers and exporters.

UK-Canada Trade Negotiations

The seventh round of UK-Canada free trade agreement negotiations took place from 11 September to 15 September. This round was conducted in a fully virtual fashion, with negotiations taking place online across all sessions.

Technical discussions were held across 23 policy areas over 53 separate sessions. They included detailed discussions on treaty text.

Both parties built on the momentum from agreeing in principle UK accession to CPTPP in March 2023. The negotiations continue to reflect our shared ambition to secure a progressive deal which strengthens our existing trading relationship, already worth over £24.8 billion in the year to Q3 2022.

Summary

The Government remain clear that any deal we sign, including with Switzerland and Canada, will be in the best interests of the British people and the United Kingdom economy. We will not compromise on our high environmental and labour protections, public health, animal welfare and food standards, and we will maintain our right to regulate in the public interest. We are also clear that during these negotiations, the NHS, and the services it provides is not on the table.

His Majesty’s Government will continue to work closely with Switzerland and Canada to ensure negotiations proceed at pace and take place on terms that are right for the UK.

The Government will continue to keep Parliament updated as these negotiations progress.

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UK Export Performance

Nigel Huddleston Excerpts

Monday 18th September 2023 Commons Chamber

[The Minister for International Trade (Nigel Huddleston)]

I beg to move,

That this House has considered UK export performance.

Back in January, the Prime Minister laid out his five priorities, high among which was to grow the UK economy, creating better-paid jobs and opportunity right across our country. To do that, he brought the Government’s business expertise and world-class trade negotiators together under one roof at the new Department for Business and Trade, beefing up our teams, refocusing our energies and better targeting our resources to support businesses and drive growth. Indeed, growth is the key to unlocking everything we want for our country. It is at the very heart of everything that this Government are doing, and there is no better way of achieving it than by exporting.

Naysayers may try to claim otherwise, but we are already in a strong position. Last year, the UK was the world’s fifth largest exporter, up from sixth the previous year. The value of the goods and services sold by our businesses overseas hit £849 billion in the 12 months to July, an increase of nearly 16% in current prices over the 12 months, and our trade deficit almost halved from September last year to this June. We also sell more services overseas than any other economy on the planet bar the USA, and those exports hit an all-time high in 2022.

Let us not forget that all these successes have come at a time of unique global challenges, from Putin’s illegal war in Ukraine to the covid recovery. UK businesses have responded with incredible resilience in the face of persistent global trade shocks.

[Aaron Bell (Newcastle-under-Lyme) (Con)]

The Minister mentioned the UK’s performance in services. We are the third largest country in the world for artificial intelligence, behind only the US and China. Does he agree that investing in our services and exporting them will become only more important as we move towards the AI revolution?

[Nigel Huddleston]

I could not agree more. That is why in our trade deals we have such a laser focus on developing services. We need to play to our strengths. Our goods are world class, but it is in services, which account for more than 70% of our economy, where we see huge potential growth. As I travel around the world, I see great enthusiasm and recognition of incredible quality in our service sector that we have not yet fully exploited. That will be a key area of focus for the Government.

The past few years have been not only testament to British businesses’ resilience and adaptability, but proof of the strong demand for UK goods and services around the world. As the UK’s International Trade Minister, I have seen that appetite at first hand. Last month, I was in Vietnam. I saw how our service exporters are already providing valuable services to Vietnam’s growing economy, from the British Council expanding education opportunities for Vietnamese students to UK architects and engineers transforming Ho Chi Minh City’s skyline. I saw how, over the coming years, there will be even more opportunities for UK businesses to trade with a nation that is set to become the world’s 20th biggest economy by 2050.

[Jim Shannon (Strangford) (DUP)]

I noticed in the paper last week that very statement that the Minister made about a young, vibrant economy full of young people who wish to excel. I know that he always tries to respond positively to questions that I and others ask in the Chamber, so let me ask him this: can Northern Ireland be part of the exports success story? We want to be.

[Nigel Huddleston]

Absolutely. I can assure the hon. Gentleman that we are focused very much on supporting and enabling Northern Ireland exporters to be successful—as, indeed, they have been. No matter where we go in the world, there is huge enthusiasm for UK goods and services, and Northern Ireland has some outstanding products that the world wants to consume. That is why we are focusing not just on the EU but on the rest of the world, where there is an insatiable appetite for UK goods and services. We want to make sure that we deliver those and get benefits from trade deals for every nation and region of the UK.

The month before I visited Vietnam, I was in India, where I announced a package of partnerships on electric mobility and construction, positioning our businesses to sell into those fast-growing sectors. Everywhere I have visited, from Oman to Indonesia, I have heard the same story: “We want to buy British.”

My message to the House is that we are working flat out to help businesses grab these opportunities—and, best of all, we are succeeding. We are not scared of challenging ourselves to do more and to move faster. That is why we have set ourselves a target of reaching £1 trillion of exports by 2030, around five years earlier than previously expected. That is an ambitious target, but one that I feel is achievable with Government and business working together.

Trade deals are at the heart of our approach, and our programme of negotiations is one of the largest in the world. We are negotiating trade deals tailored to the modern UK economy and the opportunities of individual markets. Of course, each deal is different, but all of them remove barriers to trade so that we can create the right conditions for decades of future growth, security and innovation, to help the UK thrive in a changing world. We have already secured trade deals with 73 countries as well as the EU, turbocharging key areas such as services, food, drink, automotive and life sciences, creating new opportunities in forward-leaning areas such as data and digital—as my hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell) mentioned—and enabling our businesses to sell into the economies of the future.

In July, we took a huge step forward in enhancing our presence in the Indo-Pacific when the Secretary of State signed the agreement on our accession to the comprehensive and progressive agreement for trans-Pacific partnership. That is a vast free trade area spanning from Asia to the Americas and now, with our accession, Europe. The deal will give businesses right across the UK access to a market of half a billion people—the 21st century’s middle class, with money in their pockets ready to spend on our goods and services. This is our biggest trade deal since Brexit and we are the only European member of this free trade family.

As the House will be aware, we also recently ratified our first from-scratch trade deals with Australia and New Zealand, sweeping away the majority of tariffs on goods and services with those nations and creating even closer and warmer economic partnerships. The Secretary of State recently returned from India, where she met her counterpart, Minister Goyal, and advanced our free trade agreement negotiations, which are now in their final stages. Beyond that, we are working towards deals with a host of growing economies, including members of the Gulf Co-operation Council, Israel and Mexico—one of the world’s largest consumer markets, with its population projected to reach nearly 150 million by 2035.

We are using our trade policy to maintain our position as the world’s second largest services exporter. Having worked in that field prior to politics, I have seen at first hand our huge expertise in the sector, and I know that it is vital that we reinforce our reputation and make it easier for our service providers to sell around the world. That is why we should all be excited about our talks for a new, updated trade deal with Switzerland, for example. There is a huge prize on offer for both UK and Swiss companies in everything from finance and legal to accountancy and architecture. The current trade deal is almost 50 years old and really only covers goods. The modern British economy is over 70% services, which is why we are so active in upgrading and enhancing our trade deals to suit it.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

On modernising trade deals for the future, the Minister will be aware of the real difficulties our food, farming and fishing businesses face getting their products into the EU. Why will Ministers not contemplate negotiating a veterinary agreement to sort those trade barriers out?

[Nigel Huddleston]

The hon. Gentleman will be aware, first, that we are securing deals around the world. The EU, as I have repeatedly said, is important but we are also seeking deals around the world. The EU will continue to be important and of course the trade and co-operation agreement is an important part of that relationship, but we are continuing to have conversations both at EU level and one on one with individual countries to see how we can remove market access barriers, and I will come on to that in a moment.

We are also signing memorandums of understanding with US states, including Indiana, North Carolina, South Carolina, Oklahoma and Utah, with more to come. We are building closer transatlantic partnerships that will benefit our businesses over the long run, but of course brokering agreements and engaging in talks are just one aspect of our work. We know that many British businesses want to sell overseas but are hindered by obstacles in their trading partner’s rulebook. At the Department for Business and Trade, we have a set of teams focusing on overcoming those barriers. From lifting bans on British bacon to South Korea, to raising ownership caps on solar projects in the Philippines, we are removing the barriers holding British exporters back.

That is why the Department is leading a cross-Government effort to tackle a hitlist of about 100 obstacles standing in our businesses’ way in every part of the globe. Some of those barriers might seem small, some much larger, but each and every change will remove inhibitors to business to help our businesses to prosper, generate new jobs and pay higher wages. Indeed in the year to March, we have resolved 178 trade barriers preventing businesses from selling their goods and services in over 70 countries, and removing just 46 barriers could boost UK exports by £6.5 billion over the next five years. In the Secretary of State’s first 200 days in post, we resolved the equivalent of £11 million in barriers every day.

We also recognise that, although many businesses, particularly smaller ones, want to export, many do not feel confident to do so. My Department has therefore developed a new export strategy that includes measures to help businesses to sell overseas. They include better targeted and transformed export support services and cross-Government co-operation to get more businesses selling overseas. We have a network of on-the-ground experts around the globe who are helping UK companies to understand every market’s unique opportunities and how to access them, while domestically thousands of small businesses are turning to our export support service, the first port of call for firms that want to begin their exporting journey. Since 2022, our trade advisers have handled 9,600 market inquiries. We are well aware that on-the-ground support is vital to encouraging businesses to export internationally, which is why we have a presence in over 100 international markets. Therefore, we are offering significant support to help exporters, including through trade advisers and the export academy, and we provide a wealth of information online as well. Over 400 export champions across the UK volunteer their time to share their experience and expertise, inspiring new and aspiring exporters to follow their lead. In addition, UK Export Finance, our award-winning export credit agency, is helping to support companies with export contracts around the world.

The achievements I have listed this afternoon did not happen by accident: they have only happened by creating the right environment for UK exports to flourish, and through an unrelenting focus on free and fair trade and promoting free markets. We will continue on this road, forging new deals, overcoming obstacles and creating opportunities so that UK businesses and the communities they serve can thrive.

Business and Trade update

Nigel Huddleston Excerpts

Thursday 7th September 2023 Written Statements

[The Minister for International Trade (Nigel Huddleston)]

Since Parliament adjourned for summer recess, the Department for Business and Trade has been carrying out a significant amount of activity in a number of areas. We are updating the House today on progress in these areas.

UK-India trade negotiations

The 11th round of UK-India free trade agreement (FTA) negotiations began on 5 July and concluded on 14 July in London. The 12th round of talks took place in Delhi from 8-31 August. Both rounds were conducted in a hybrid fashion.

During round 11, India’s Minister for Commerce and Industry, Piyush Goyal, visited London. Discussions covered the status of the negotiations, as well as wider trade and investment opportunities for the UK and India. Shri Sunil Barthwal, India’s Commerce Secretary, also visited the UK during the round to meet with senior UK trade officials and take stock of progress made in the round.

During round 12, between 24-26 August, the Secretary of State visited India to attend the final trade and investment working group of the Indian G20 Presidency. During her visit, she again met with Minister Goyal. Their discussions focused on goods, services and investment. We agreed to hold round 13 in September.

UK-Gulf Cooperation Council (GCC) trade negotiations

The fourth round of UK-Gulf Cooperation Council free trade agreement (FTA) negotiations began on 17 July and concluded on 28 July in London. The round was held in a hybrid fashion.

Technical discussions were held across 23 policy areas over 44 sessions. Good progress was made and both sides remain committed to securing an ambitious, comprehensive and modern agreement fit for the 21st century.

UK-Israel trade negotiations

The third round of United Kingdom-Israel free trade agreement (FTA) negotiations began week commencing 23 July. The round was held in a hybrid fashion—UK officials travelled to Jerusalem for negotiations and others attended virtually.

We focused primarily on trade in services and procurement, which are key areas not covered by our current trading arrangements under the trade and continuity partnership agreement. Negotiators held text-based and technical discussions across 10 policy areas and 32 sessions in Jerusalem. Both sides continue to work towards an upgraded modern agreement and the fourth round of negotiations will take place in due course.

Smarter regulations

We intend to introduce legislation to further extend recognition of the CE mark in Great Britain for regulations managed by the Department for Business and Trade when parliamentary time allows.

Government have engaged extensively with industry to understand concerns about the requirement to use the UKCA mark on many products from December 2024. We have heard that the planned transition to UKCA poses challenges and costs for businesses. We have listened and we are taking action.

Businesses will have the flexibility and choice to use either the UKCA mark or the EU’s CE mark to place goods on the GB market. This approach is designed to minimise additional regulatory compliance costs for businesses while ensuring consumers can continue to access safe products. We will engage with industry to develop our proposed approach to product markings and CE recognition in a way that benefits both British businesses and consumers.

Departmental responsibility transfer update

Following machinery of Government changes, responsibility for the pre-existing provision for covid loan guarantees and the pre-existing Post Office working capital facility has transferred from the former Department for Business, Energy and Industrial Strategy to the Department for Business and Trade.

Following review, it has been noted that at the Department for Business and Trade’s main estimate for 2023-24 Government officials did not include the cash required to meet payments for these pre-existing arrangements. Parliamentary approval for additional cash of £3,659,625,000 will be sought in a supplementary estimate for the Department for Business and Trade. Pending that approval, urgent expenditure estimated at £3,659,625,000 will be met by repayable cash advances from the contingencies fund. The cash advance will be repaid upon receiving Royal Assent on the Supply and Appropriation Bill.

Shipbuilding credit guarantee scheme (SCGS)

Today the Secretary of State is laying a departmental minute describing a contingent liability arising from the launch of a shipbuilding credit guarantee scheme (SCGS) before Parliament.

The scheme is a finance instrument which will provide guarantees to banks in respect of loans made to vessel owners and operators seeking to place orders at UK shipyards. The shipbuilding credit guarantee scheme (SCGS) will guarantee a portion of the value of eligible loans, sharing the risk with lenders to encourage offers of finance to UK vessel owners and operators.

The SCGS is one of a number of targeted interventions being taken as part of over £4 billion of Government investment planned through the Government’s national shipbuilding strategy refresh, to encourage UK ship owners and operators to place new orders and upgrade their existing fleets with world-leading shipyards that are based up and down the UK. HM Treasury has approved the arrangements.

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Comprehensive and Progressive Agreement for Trans-Pacific Partnership

Nigel Huddleston Excerpts

Tuesday 18th July 2023 Commons Chamber

[Helen Morgan (North Shropshire) (LD)]

(Urgent Question): To ask the Secretary of State for Business and Trade if she will make a statement on the comprehensive and progressive agreement for trans-Pacific partnership.

[The Minister for International Trade (Nigel Huddleston)]

The Secretary of State for Business and Trade signed the accession protocol to the comprehensive and progressive agreement for trans-Pacific partnership on Sunday 16 July in Auckland. The UK will be the first new member since CPTPP was created. With the UK as a member, CPTPP will have a combined GDP of £12 trillion and will account for 15% of global GDP. Accession to the agreement sends a powerful signal that the UK is using our post-Brexit freedoms to boost our economy. It will secure our place as the second largest economy in a trade grouping dedicated to free and rules-based trade. It gives us a seat at the table in setting standards for the global economy.

The agreement is a gateway to the wider Indo-Pacific, which is set to account for the majority of global growth and around half of the world’s middle-class consumers in the decades to come. That will bring new opportunities for British businesses abroad and will support jobs at home. More than 99% of current UK goods exports to CPTPP countries will be eligible for zero tariffs. The UK’s world-leading services firms will benefit from modern rules, ensuring non-discriminatory treatment and greater transparency. That will make it easier for them to provide services to consumers in other CPTPP countries.

In an historic first, joining CPTPP will mean that the UK and Malaysia are in a free trade agreement together for the first time. That will give businesses better access to a market worth £330 billion. Manufacturers of key UK exports will be able to make the most of tariff reductions to that thriving market. Tariffs of around 80% on whisky will be eliminated within 10 years, and tariffs of 30% on cars will be eliminated within seven years. Joining CPTPP marks a key step in the development of the UK’s independent trade policy. Our status as an independent trading nation is putting the UK in an enviable position. Membership of that agreement will be a welcome addition to our bilateral free-trade agreements with more than 70 countries. I pay tribute to the many officials and Ministers who have worked on this deal over the past two years, some of whom are in the Chamber today.

[Helen Morgan]

Thank you, Mr Speaker, for granting this urgent question.

The Government published a written statement yesterday that the CPTPP had been signed on 16 July. Unfortunately, Members have not had an opportunity to scrutinise the agreement, or to ask the Secretary of State questions about its impact. The CPTPP contains controversial provisions that will potentially undermine British health and safety standards, as well as those in place for the environment and animal welfare. Organisations from trade unions to the RSPCA have expressed their concern. It is apparent that clauses in the arrangement will allow large companies to sue the UK Government behind closed doors if they believe that their profits have suffered from changes to laws or regulations.

Palm oil produced in Malaysia will have tariffs of 12% eliminated, including from areas that have been deforested. There is apparently no mechanism to ensure that imports of palm oil have been sustainably produced. On food standards, the agreement excludes eggs as a sensitive sector, meaning that egg products will be allowed to be imported from countries that are CPTPP members, but where egg production relies heavily on battery caged hens, which were outlawed in Britain in 2012.

For other animal products, sow stalls, the use of antibiotics, hormone treatments and pesticides that are outlawed here will all potentially be imported in greater numbers. Imports that have a lower production cost but a much higher animal welfare and environmental one, risk undermining our world-leading British farmers and food producers.

The Business and Trade Committee, which provides important scrutiny of the process for free trade agreements, produced a report last week that lamented its inability to scrutinise all elements of the trade agreement.

I have the following questions for the Minister. What steps are his Government taking to ensure that the British public can be sure that the food they buy has been produced to the food safety and animal welfare standards that they rightly expect, such as those of the British Lion code of practice? What estimate has he made of the long-term impact on British farming of this agreement, which will bring an increase to GDP of only 0.8% over a decade?

[Nigel Huddleston]

I am disappointed that the hon. Lady does not see the opportunities for farmers and for this country as a whole from CPTPP. If she shared the confidence in British producers and British services that we have on the Government Benches, she might be able to look at this deal with a glass half full, rather than a glass half empty, but I know that would be a fundamental change of attitude.

The hon. Lady is simply wrong in many areas. It is important that we stop peddling these myths about standards related to CPTPP or any trade deal we are doing. Let us be clear that this deal does not lower any UK product or quality safety requirements. The import standards and import rules that we had the day before we joined CPTPP will be exactly the same the day after. The deal does not alter safety standards, but gives us an opportunity to engage and talk with colleagues and friends around the world on how we would like to improve and work on important issues, such as the environment, which she mentioned, and there is indeed an environment chapter. For example, the UK is committed to tackling illegal deforestation within UK supply chains, and this deal will not change that. As part of concluding CPTPP, the UK and Malaysia have issued a joint statement to reaffirm and strengthen joint work to support sustainable production, particularly of palm oil, in our supply chains.

[Mr Ranil Jayawardena (North East Hampshire) (Con)]

Despite what the naysayers on the Opposition Benches might say, is it not true that this deal benefits counties and nations across these isles and gives our farmers the opportunity to export to parts of the world that will pay a premium for their great products?

--- Later in debate ---

[Nigel Huddleston]

My right hon. Friend is absolutely right, as always, and I thank him for his work in making this deal a reality too. He is absolutely correct that this deal creates opportunities across the whole range of food and beverages, including Scotch whisky, which I have already mentioned. This deal should be welcomed by Scotland for the opportunity it gives, but in many areas of food we are opening up markets, such as in dairy produce. He is absolutely right to point out that we estimate that CPTPP will bring benefits to every single nation and region of the UK. I would hope today that we hear about those positive strides on CPTPP from all those in the Chamber who represent different parts of the country.

[Mr Speaker]

I call the shadow Secretary of State.

[Nick Thomas-Symonds (Torfaen) (Lab)]

I congratulate the hon. Member for North Shropshire (Helen Morgan) on securing this urgent question. We on the Opposition Benches are pro-trade, pro-business and pro-worker, and we welcome the opening up of new markets for UK exporters. I have met representatives from the CPTPP signatories and made clear to them our commitment to driving up trade. However, we now must scrutinise the full details of this agreement because, with this Government, the devil is always in the detail.

What provisions are in place to ensure the highest possible workers’ rights and that UK workers are operating on a level playing field? The Minister mentioned the sustainability agreement with Malaysia. Can he tell us exactly how that will deal with the concerns raised on palm oil? Can he also tell us whether the Government have put in place any side-letters, as the Government of New Zealand have done, to exclude the operation of the investor-state dispute resolution mechanism? Can he confirm that the agreement will not undermine the Windsor framework? On China’s application to join CPTPP, what approach will the Government take to safeguard British interests? We have raised the issue of the scrutiny process on free trade agreements many times. Can he set out what the scrutiny process will be?

The Government’s own modelling suggests that this accession will add 0.08% to GDP. At the same time, the OBR predicts that exports will fall by 6.6% this year—a hit of more than £51 billion. Promised trade deals with the US and India are not even in sight. Is it not the reality today that we have a Government out of ideas and bad at negotiating, and it is the economy that suffers?

[Nigel Huddleston]

I am sorry to hear the Opposition yet again never miss an opportunity to talk Britain down. This is a great opportunity for businesses right across the UK. Already, CPTPP countries sustain about one in 100 jobs in the UK, and that will only go in one direction—it will increase because of the opportunities, including in investment, that open up. The shadow Secretary of State mentioned investor-state dispute settlement. There is coverage of ISDS. It is a good thing and it helps ensure confidence in international trading and international investment. He mentioned China. He will be well aware that we are not yet fully ratified members of CPTPP, so it would be inappropriate for us to comment on any individual application. However, what I can say is that we know after two years of negotiation what an incredibly high bar exists on membership of this fantastic organisation.

[David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)]

Does my hon. Friend agree that this is not only an important trade deal, but an important geopolitical event that allows Britain’s shared values, which the Labour Prime Minister of New Zealand and the Labour Prime Minister of Australia say they share, to be brought to the partnership and to strengthen the partnership as it goes forward?

[Nigel Huddleston]

My right hon. Friend is making a powerful and important point about the importance of pivoting to the Indo-Pacific, where there is so much global growth. We want to be part of that growth. I thank him for the incredible work he does as one of the Prime Minister’s trade envoys. As well as more trade, this deal will lead to further co-operation. When we trade with countries, we talk to them more, we have agreements and discussions on a whole range of issues, some of which go beyond the strict terms of a trade agreement. There are many opportunities to come out of this deal, and I am pleased that many Members on the Government Benches recognise them.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the shadow SNP spokesperson.

[Richard Thomson (Gordon) (SNP)]

It feels unnecessary to repeat this, but this Government seem willing to sign up to any trade deals. My party is in favour of good ones, and we are against poor ones, and that is why we oppose this deal. [Interruption.] The concerns that we have, despite the heckling from those on the Government Benches, about the lack of mechanisms to safeguard workers’ rights and about the potential impacts on domestic standards, particularly in the agrifoods sectors, do not go away with blustery repetition and flat contradiction, which seems to be the stock-in-trade in all that Government Front Benchers have to say about this deal.

The Secretary of State gets aerated whenever it is pointed out that the Government’s own figures show that GDP is estimated to increase by only 0.08% over the next 10 years as a result of the deal, at the same time as the Office for Budget Responsibility forecasts a 4% hit to GDP through Brexit. Ministers have had an awful long time to find out what the figure actually is, if they do not believe that 0.08% figure. Without reference to vague opportunities, the number of middle-class consumers in the Pacific rim or the GDP of countries in the CPTPP, and without deviation, repetition or hesitation, what exactly will the impact be on UK GDP as a result of this deal?

[Nigel Huddleston]

Again, I am disappointed to see the hon. Gentleman talk negatively about a deal that will benefit Scotland as well as all other parts of the United Kingdom. It will add significant amounts. We estimate that in the long run, at least £2 billion a year will be added to the UK economy, including in his constituency. Perhaps he would like to welcome that, rather than be negative about it. Also, this is a growing area of the world. There are likely to be new members, so we anticipate considerable opportunities going forward. In Scotland, 547 businesses are already owned by CPTPP countries, employing more than 20,000 people in Scotland. Perhaps he would like to welcome that.

[Mark Menzies (Fylde) (Con)]

As someone who has served as the Prime Minister’s trade envoy for the past seven years in Chile, Colombia, Peru and Argentina, I warmly welcome this announcement. I urge the Minister to make sure we are using the time between now and finally joining CPTPP to make sure that in the sectors that we think will be hugely beneficial to us, we are ramping up that British industry presence and are working with His Majesty’s trade commissioner for the area to identify opportunities.

[Nigel Huddleston]

I thank my hon. Friend for his work as a trade envoy as well as all the trade envoys for the important work they do. He makes an important point: signing the deal is one thing, but we need to ensure that it is used. The Secretary of State has said that again and again. We will be making sure that there is full benefit, using export support services and all the training, trade advisers and so on to promote the deal, as we have with the Australia and New Zealand deals, because it is important that we get the full benefit of the deal and maximise those benefits right across the country.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the Chair of the Business and Trade Committee.

[Darren Jones (Bristol North West) (Lab)]

UK car manufacturers are currently changing their supply chains to buy components from either the EU or the UK so that they can continue to export their cars into the EU. However, under CPTPP, those same companies ought to be buying parts from Vietnam to export their cars to Mexico. That is quite confusing. Will the Department publish guidance for business that highlights the regulatory conflicts between trade with the European Union under the trade and co-operation agreement and trade with members of the CPTPTPP? Sorry—you know what I meant. [Laughter.]

[Nigel Huddleston]

It trips off the tongue eventually. The hon. Gentleman is underestimating the opportunities, but he has given me the chance to point out one of the key benefits of CPTPP, which is cumulation, with products and parts being used—of course, supply chains can be complex across CPTPP—and still benefiting from the lower tariffs. So there are huge opportunities with CPTPP for the reasons that he outlined.

[Alun Cairns (Vale of Glamorgan) (Con)]

I congratulate the Minister as well as all the Ministers who have contributed to this significant moment, with the UK striking a trade deal with some of the world’s fastest-growing economies. Does he agree that this provides a great opportunity for all parts of the United Kingdom where we have significant strengths in terms of driving exports? What action is he planning to take to promote the trade deal all around the UK so that manufacturers, food producers and other suppliers take the opportunity that he has provided?

[Nigel Huddleston]

I thank my right hon. Friend. Again, I really appreciate the recognition that the deal will benefit all nations and all regions of the UK. In Wales, for example, there are currently 281 CPTPP-owned businesses employing more than 16,500 people, and we expect that to go up. There are trade opportunities in so many areas covering both goods and services. That is a really important point: as we negotiate a lot of trade deals around the world, one thing we notice about many of the deals done by the EU on our behalf is that they did not cover services, yet services are over 70% of our economy, so it is great that we are now negotiating deals that fit our modern economy.

[Patrick Grady (Glasgow North) (SNP)]

Even if the world was flat—for the benefit of the Minister’s Back Benchers, it is not—the Pacific would still be very far away compared to Europe, so how does the deal benefit fresh seafood producers and shellfish producers on the west coast of Scotland who cannot get their fresh produce into the much-closer European market as a result of Brexit? How on earth are they supposed to get that fresh produce even more quickly halfway around the world?

[Nigel Huddleston]

Again, I am sorry to hear hon. Members conflate different points. We have left the European Union—that was a democratic decision—and we have a good free trade agreement with the European Union that will continue. CPTPP creates opportunities in areas of the world with considerable growth where we did not previously have deals. Surely the hon. Member must recognise that that is a positive thing right across the country, including for his constituents?

[Mark Pritchard (The Wrekin) (Con)]

This is good news. I am delighted that the Government have signed up to this huge trade partnership. We are the first non-founding member to have done so. While it may not be in the convenient party political interests of some Opposition Members, it is very much in the national interest and, dare I say it, in the interest of Shropshire businesses—small, medium and large—who will now be able to export tariff-free or towards tariff-free to places such as Malaysia and Vietnam. What progress, if any, has the Minister heard about the United States potentially joining the partnership as well? That, of course, would be a huge boon to everybody.

[Nigel Huddleston]

My hon. Friend makes an important point about the role that small and medium-sized enterprises can play. We are working to encourage even more SMEs to export through export support services and the trade advisers network given the opportunities that this and other deals will present to them. He will be aware that the US is not entering into free trade agreements with anybody at the moment. I have spoken to congressmen and women in the US, and there are mixed views, but many have great enthusiasm for the CPTPP.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

Despite all the Government fanfare, the CPTPP trade deal will contribute merely 0.08% to our country’s GDP over the next decade. Laughably, the Secretary of State is now disputing her own Department’s modelling. As part of the spring Budget, the OBR forecast said that in 2023, due to Government incompetence, the hard Brexit and failure to sign other free-trade deals, UK exports are set to fall by 6.6%. That is a staggering £51 billion hit to our economy. How exactly will the Minister compensate for that loss with respect to the signing of the new CPTPP deal?

[Nigel Huddleston]

Again, I am so disappointed to hear Opposition Members never missing an opportunity to talk Britain down. CPTPP will benefit every nation and region of the UK, to the tune of billions and billions of pounds—[Interruption.] The hon. Member says that is tiny, but if we put it in his bank account tomorrow, he would probably be quite happy. We are talking about huge amounts of money and lots of jobs right across the United Kingdom. It would be great to see the Opposition support one of these deals, which will benefit their own constituents, at some point.

[Martin Vickers (Cleethorpes) (Con)]

I join others in congratulating the Secretary of State, her predecessors and all the Ministers involved in delivering this excellent deal, which, as has been said, is really good news for the UK. It is depressing to hear Opposition Members’ comments; they clearly have little confidence in British companies. Businesses in the Yorkshire and Humber region will certainly benefit from the new deal. Will the Minister elaborate a little more on how he sees those businesses being able to take advantage of it?

[Nigel Huddleston]

I thank my hon. Friend for his work in championing international trade over many years. He is right that signing this deal and other deals is one thing, but we must ensure that businesses are aware of the opportunities. Therefore, we will be, and are already, working through export support services, trade advisers and other programmes to ensure that we take full advantage of the opportunities available. We want businesses large and small, some of whom have probably never exported before, to realise that there is a whole world of opportunities out there in the EU, but also way beyond that.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

Great emphasis has been placed on the diplomatic benefits that the UK will see through joining the CPTPP. What further steps are Ministers taking to cultivate positive diplomatic relations in the Indo-Pacific region?

[Nigel Huddleston]

There are multiple ways in which we are doing so. In fact, the Minister of State, Foreign, Commonwealth and Development Office, my right hon. Friend the Member for Berwick-upon-Tweed (Anne-Marie Trevelyan), is doing exactly that right around the Indo-Pacific on an ongoing basis. As well as advancing our trading opportunities, there are many opportunities to have discussions on a wide range of issues that concern us and our constituents, whether that is the environment, labour rights or a whole bunch of others. Some of those are part of trade deals, but many go beyond them. We have discussions across multiple Government Departments on those issues.

[James Sunderland (Bracknell) (Con)]

I thank the Government for this excellent announcement and congratulate all of those who have made it possible. It is beyond question that joining the CPTPP is absolutely the right thing to do. May I please ask the Minister what message he has for the doomsters who think that Britain should not have a global role, who think that Britain is in permanent decline and who think that we would be better off back in the European Union?

[Nigel Huddleston]

The message is quite simple: life is better with the Conservatives in charge.

[Jim Shannon (Strangford) (DUP)]

Let us not be churlish—this is a good deal and the Government deserve some credit for it. I sometimes despair when I hear those negative comments. When something is good, let us say that it is good. In the light of this tremendous deal secured by the Business and Trade Secretary, will the Minister further outline how his Department will work with FCDO Ministers to ensure that such deals further the aims and terms of our moral duty and international obligations? Again, I congratulate the Minister and the Government on their hard work well achieved and a deal done.

[Nigel Huddleston]

I thank the hon. Member for his always gracious and considered comments. He is right that we are committed to ensuring that all nations and regions of the UK benefit from this deal, including Northern Ireland, which is doing great things with export opportunities. In fact, there is a Northern Ireland investment summit coming up and, therefore, many opportunities. We will work constantly with the Administrations to make sure we take full advantage of this and all deals.

[Bob Blackman (Harrow East) (Con)]

I congratulate my hon. Friend and everyone involved in securing this deal. The impact of exporting services across the world is clearly vital. Will he outline the advantages for the services deals available, particularly to London and the digital economy, which can be reached from anywhere in the world?

[Nigel Huddleston]

My hon. Friend makes a sensible point that is pivotal to our future trading arrangements. We are the second biggest service exporter in the world. Those services are increasingly being transported, and therefore physical distance does not matter—they can be delivered at the press of a button. We have an excellent reputation on those. He makes the point about London; more than 3,000 businesses are owned by CPTPP members, and over 100,000 jobs are reliant on those businesses. That will only increase over time. It is important to stress that London is benefiting from our relationship with CPTPP members, but more than 75% of the benefits are outside London.

[Karl MᶜCartney (Lincoln) (Con)]

In contrast to the negativity from the Opposition Benches that oozes across the Chamber, I positively welcome my hon. Friend’s update. Is there anything comparable in recent history or down the tracks as good as the agreement and partnership that has been entered into?

[Nigel Huddleston]

Let us bank this agreement for the positive benefits it will bring. My hon. Friend knows I am a yellowbelly, and Lincolnshire people always talk common sense, as does he. There are a lot of opportunities, but this is one of many deals we have already signed and inked—more than 70 since we left the European Union. We are in negotiations with many areas including India, Switzerland and others. Importantly, we are focusing on services as well as goods, because some of those deals do not cover services at the moment.

[Tom Randall (Gedling) (Con)]

In the 1975 European Economic Community referendum campaign, Barbara Castle asked:

“what kind of internationalism is it that says that henceforth this country must give priority to a Frenchman over an Indian, a German over an Australian, an Italian over a Malaysian? This isn’t the language of internationalism… It is Euro-jingoism.”

Does my hon. Friend agree that, with the signing of the partnership, the era of Euro-jingoism is dead, and once more we are truly an international trading power?

[Nigel Huddleston]

My hon. Friend speaks eloquently and is absolutely right. Europe will continue to be an important trading partner of the United Kingdom, but there is a whole world out there that we have not yet taken full advantage of. The Government are committed to working on behalf of our constituents to recognise the benefits from around the world, through our relationships with Commonwealth countries and developing countries that can significantly benefit from international deals. The EU will continue to be important, but there is a whole new world out there and we want to be part of it.

UK-Türkiye: Free Trade Agreement

Nigel Huddleston Excerpts

Tuesday 18th July 2023 Written Statements

[The Minister for International Trade (Nigel Huddleston)]

The United Kingdom and the Republic of Türkiye are significant and close trading partners. We have a bilateral trading relationship that is going from strength to strength, worth £23.5 billion in 2022, up more than 30% from the previous year. The Government intend to build upon this success and are today confirming their intention to begin talks towards an enhanced free trade agreement.

The current agreement was signed in December 2020, and is based on the EU’s trade agreement with Türkiye. It predominantly covers industrial goods and has provided continuity to businesses and safeguarded supply chains since our departure from the European Union.

A review clause in the current agreement committed the UK and Türkiye to review the trade relationship. That review began ahead of schedule last year and has now been completed, with both the UK and Türkiye concluding that there is value to our economies in broadening and deepening the trade relationship. The UK and Türkiye will today hold an officials-level Joint Committee, responsible for overseeing implementation of the current agreement and any other matter under the agreement to formally conclude the review and move towards renegotiation of the free trade agreement. The UK expects to launch a call for input in the autumn and, following consultation, we expect to start renegotiations next year.

An improved agreement with Türkiye is a key part of the UK’s strategy to secure advanced modern agreements with international partners and upgrade existing continuity agreements. The Government are clear that any deal with Türkiye should be in the best interests of the British people and the UK economy. We will not compromise on our high environmental and labour protections, public health, animal welfare and food standards, and we will maintain our right to regulate in the public interest. We are also clear that during these negotiations, the NHS, and the services it provides are not on the table. This is an opportunity to work towards an agreement that is fit for the 21st century and suited to the modern UK economy.

[HCWS963]

Free Trade Agreements: Scrutiny

Nigel Huddleston Excerpts

Thursday 13th July 2023 Commons Chamber

[Darren Jones]

I thank my hon. Friend for her questions and comments from the Dispatch Box, and I will take each in turn.

My hon. Friend is right about resource allocation. As I said in my speech, we have subsumed not only the responsibilities of the International Trade Committee but those of our former colleagues on the European Parliament committee that had power and resources to scrutinise trade agreements on our behalf when we were a member of the European Union. I gently suggest to the House that this is just one example of where, post Brexit, Committees ought to have greater resources, both financial and otherwise, for the additional work we have taken on after leaving the European Union.

The issue of time has been raised both by me today and by the predecessor Committee and our colleagues in the other place. These agreements are long and complicated, and the House’s Select Committees have other work to do in holding Departments to account. Having as much time as possible is always very welcome.

On access to information, let me add that I have learned, having taken on these responsibilities, that it is often easier to look at the press coverage in the other country to find out what is going on than it is to try to get information from the Government. If this information is on the public record, albeit in another country, it ought to be readily shared with us in this Parliament. I encourage Ministers to take that action.

Lastly, on Australia and New Zealand, my hon. Friend pointed out that an unusual approach was taken in the use of primary legislation and highlighted what that meant for this House’s ability to debate and intervene in the details of those agreements. I am not privy as to why Ministers chose to do that, but it is unusual. If it were a symbol, at least, that the Government are minded to update the processes for scrutinising FTAs, perhaps we could take the opportunity to do that.

[The Minister for International Trade (Nigel Huddleston)]

I thank the hon. Gentleman, all members of the Committee and the officials, whom he mentioned, for their work on this report. It shows how seriously they take their responsibilities, which is very much appreciated by the Government.

We believe that the level of transparency and scrutiny for trade agreements stacks up quite well, particularly when compared with the arrangements in other parliamentary democracies. I understand that there is no formal requirement for a formal response from the Government, but I would like to ask him whether he would like to meet me to discuss his findings further.

[Darren Jones]

We are always very grateful for Ministers wanting to appear before the Committee, and we would be delighted to have the Minister before us. There is definitely a debate to be had about how we update our rules. I make the point again that not only were our rules set at a time when we were part of the EU and therefore the European Parliament, but they were based on a convention from 1929. Free trade agreements have changed a lot since the 1920s, and therefore our rules should probably be updated as well.

Oral Answers to Questions

Nigel Huddleston Excerpts

Thursday 29th June 2023 Commons Chamber

[Martyn Day (Linlithgow and East Falkirk) (SNP)]

3. What recent assessment she has made of the potential impact of her Department’s trade policies on food prices.

[The Minister for International Trade (Nigel Huddleston)]

We recognise the important role that trade can play in improving food security. That is why our trade policy aims to help people to access good-quality and good-value food. Our free trade agreements help to remove market access barriers, supporting our importers and exporters. The new developing countries trading scheme, for example, reduces tariffs on nearly £1.4 billion-worth of agriculture goods, and we work with international partners, including at the World Trade Organisation, to remove trade barriers and strengthen the UK’s global food supply.

[Martyn Day]

I am grateful to the Minister for his answer, but Melissa Leach, the director of the Institute of Development Studies, has spoken about the need to increase access to affordable, nutritious food. She said:

“Over the last decade, charities have stepped in to plug the gaps left by the state but this is not an acceptable or sustainable way to address the growing prevalence of hunger”.

Does the Minister accept that his Government’s commitment to Brexit has led to increasing prices of food that is imported and has contributed to food poverty in the UK?

[Nigel Huddleston]

The hon. Gentleman will be well aware that food price inflation is not unique to the UK; it is a global phenomenon that we all face. Actually, food price inflation peaked at 19.2% in the EU and at 19.2% in the UK, so we are facing the same problems. However, we have provided more than £94 billion-worth of support precisely to help the most vulnerable in society.

[Greg Smith (Buckingham) (Con)]

There are many factors impacting food inflation, not least increasing global input costs, but surely the most important thing that my hon. Friend’s Department can do to shore up British agriculture and have a positive impact on food prices is to carry on, full speed ahead, getting the new trade deals that will see British first-class produce sold as a premium product worldwide.

[Nigel Huddleston]

My hon. Friend is absolutely correct. It is really important that we have support across the House for these important trade deals. They are good for the British economy, particularly good for British farmers, and good for prices in the UK. I hope, at some point, to see the Opposition parties supporting one of these important deals, which are transparently in the interests of British consumers in every nation and region of the United Kingdom.

[Mr Speaker]

I call the shadow Minister.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Since 2019, food prices in the UK have rocketed by 26%, a figure that is among the highest in the G7, yet the Prime Minister’s plans for new border checks on highly perishable food from Europe could push prices up again. A veterinary agreement would cut the cost of bringing food into Britain from Europe. Given that many families are already struggling to put enough food on the table and that every significant business organisation supports a veterinary agreement with the EU, why will the Secretary of State not take the sensible and pragmatic step of starting negotiations for such an agreement?

[Nigel Huddleston]

The hon. Gentleman will be aware that discussions are happening on an ongoing basis with the Foreign, Commonwealth and Development Office about the trade and co-operation agreement and other matters. We have very constructive dialogue with our EU partners. In fact, the Secretary of State and I had a meeting with the EU ambassadors just yesterday.

As for our achievements since leaving the EU, it is important to stress one thing: we have been laser-focused on making sure that the benefits are for the British consumers. We have got rid of thousands and thousands of tariffs. We have liberalised tariffs, reduced them or eliminated them altogether. For example, to compare us with the EU, 27% of the EU’s current external tariffs are zero-rated, whereas the proportion for the UK is 47%. We are significantly reducing tariffs, which is in the best interests of the British consumer, as a result of leaving the European Union.

[Mr Laurence Robertson (Tewkesbury) (Con)]

4. What steps she is taking to increase trade with African countries.

[The Minister for International Trade (Nigel Huddleston)]

To increase and grow trade with Africa, we are using our nine trade agreements, covering 18 African nations. In April 2024, the Prime Minister will host the second UK-Africa investment summit to showcase investment opportunities and advance two-way trade. Just this month, we launched the developing countries trading scheme, which covers 65 countries, including 37 African countries.

[Mr Robertson]

That is all good news, particularly the developing countries trading scheme. I was recently in Ethiopia for a trade visit. Can the Minister tell me how the developing countries trading scheme, in particular, will help Ethiopia?

[Nigel Huddleston]

I thank my hon. Friend and constituency neighbour for the work he does as the Prime Minister’s trade envoy to Ethiopia and many other countries. I was also in Ethiopia recently, and many people were praising my hon. Friend and his work. He is right that the developing countries trading scheme will reduce tariffs, which is a win-win both for developing countries, making it easier and cheaper for them to export to the UK, and for UK consumers because it will reduce prices. It is not just a matter of having the deal; we are laser-focused on making sure the benefits of the deal are realised, with more than 100 Department for Business and Trade officials working in Africa to make sure we get the full benefit of these deals.

[Tim Farron (Westmorland and Lonsdale) (LD)]

As the Government rightly consider new trade deals with other countries, what lessons will they learn from the hideous mistakes made in the New Zealand and Australia trade deals? The right hon. Member for Camborne and Redruth (George Eustice), a former Secretary of State for Environment, Food and Rural Affairs, rightly said that they are bad deals for Britain. Given that British farmers are so angry with this Government, having been thrown under the bus on animal welfare and on environmental and cost issues, will he learn lessons from those mistakes and make sure British farmers are protected, and that environmental and animal welfare standards are protected, too?

[Nigel Huddleston]

I am, quite frankly, astounded by the hon. Gentleman’s comments. He is well aware, as I have said repeatedly and is widely acknowledged, that the trade deals we have developed, including with Australia and New Zealand, are economically beneficial right across the UK, including in his constituency. If he does not wish to support policies that are in the best economic interests of his constituency, that is something his constituents probably need to recognise come the next election.

[Nicola Richards (West Bromwich East) (Con)]

5. What progress she has made on negotiating a bilateral free trade agreement with Israel.

[The Minister for International Trade (Nigel Huddleston)]

We are continuing to make progress towards an upgraded UK-Israel free trade agreement, focused on services, procurement and innovation, and we concluded the second round of negotiations on 17 May. As two service-driven economies, this negotiation is an excellent opportunity to build on our existing goods-focused agreement, particularly to boost trade in services with an innovative, high-tech nation such as Israel.

[Nicola Richards]

The UK’s trade with Israel increased by 42% in 2022 compared with 2021, and it is valued at £7.2 billion. Israel is a key trade and security partner in the region, and it is a world leader in many areas. Can the Minister update the House on the Department’s progress on the trade aims outlined in the 2030 road map for UK-Israel bilateral relations, namely the establishment of a UK-Israel free trade agreement, the Britain-Israel Investment Group and a UK-Israel innovation and investment summit?

[Nigel Huddleston]

My hon. Friend is all over the numbers, which saves me from repeating them. The benefits of the trade agreement are obvious, and we continue to strengthen our trade relationship with Israel, which is a valued friend and ally. As outlined in the 2030 road map for UK-Israel relations, a service-based free trade agreement between our two nations will act as a cornerstone of this relationship in years to come. As such, we are pleased to have successfully concluded the second round of negotiations in London just last month, and we look forward to holding further talks in due course.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for that very positive response. We in Northern Ireland are keen to ensure that the bilateral trade agreements benefit our companies as well. Some people and councils across this great United Kingdom of Great Britain and Northern Ireland wish to downgrade Israel’s goods. I know that the Minister and our Government want to do the very opposite. Will the Minister tell the House what he is prepared to do to ensure that Israeli goods are promoted right across this great United Kingdom of Great Britain and Northern Ireland?

[Nigel Huddleston]

Absolutely. Israel is already a really important trading partner, right across the UK, and it will continue to be so. As we negotiate this deal, it is important that we focus on the areas of greatest opportunity. Once the deal is done—of course, this is an upgrade—we will be actively working to make sure that the communications about the benefits of the deal are understood by everybody. We will be working with various bodies and groups, including the devolved Administrations and bodies, to make sure that we take full benefit from these deals. Signing the deal is one thing, but taking and making the best of the opportunities is another—we will be working on that as well.

[Richard Graham (Gloucester) (Con)]

6. What steps her Department is taking to ensure that the UK’s accession to the comprehensive and progressive agreement for trans-Pacific partnership increases economic opportunities for businesses and consumers.

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[Nadia Whittome (Nottingham East) (Lab)]

14. What steps her Department has taken to ensure that the free trade agreement with Israel complies with the UK’s obligations in section 5 of United Nations Security Council resolution 2334.

[The Minister for International Trade (Nigel Huddleston)]

The UK’s position on settlements is clear: they are illegal under international law, present an obstacle to peace and threaten the physical viability of a two-state solution, as set out in the UN Security Council resolution 2334 and restated recently by the UNSC presidential statement in February 2023. We repeatedly call on Israel to abide by its obligations under international law and have a regular dialogue with Israel on legal issues relating to the occupation.

[Alan Brown]

The Minister is clearly aware then that resolution 2334 states that countries must

“distinguish, in their relevant dealings, between the territory of the State of Israel and the territories occupied since 1967.”

I welcome his comments confirming that the Government’s belief is that the settlements are illegal under international law. How will the Government ensure that goods and services from these illegal settlements—in effect, stolen land—are excluded from the benefits of a free trade agreement?

[Nigel Huddleston]

Under our existing agreement, Israeli goods from the state of Israel receive tariff preferences under the UK-Israel partnership agreement. Palestinian goods, from the Occupied Palestinian Territories, benefit from trade preferences in the interim UK-Palestinian Authority bilateral agreement. To be clear, only goods originating from the state of Israel are covered by our current FTA, and that will not change in the upgraded FTA.

[Andy McDonald]

Last week, it was reported by The Jerusalem Post that Israel’s National Security Minister Ben-Gvir, who just 15 years ago was convicted of inciting racism and supporting a terrorist organisation, had told settlers in the illegal west bank outpost of Evyatar:

“The Land of Israel must be settled and at the same time as the settlement of the Land a military operation must be launched.”

He then spoke of demolitions and the killing of “thousands” of Palestinians, in order to “fulfil our great mission.” Will the Minister condemn those genocidal remarks about Palestinians, and ensure that any trade deal with Israel explicitly bans UK trade with those illegal settlements and makes binding regulations for companies to uphold human rights standards?

[Nigel Huddleston]

The hon. Gentleman will be aware that the UK is a leading advocate of human rights around the world. We have very frank conversations with our allies and we have frank and honest discussions across Government. In answer to the trade element of his question, as I said previously, only goods originating in the state of Israel are covered by our current FTA, and that will not change under the upgraded FTA.

[Nadia Whittome]

I welcome the Minister’s restatement of Government policy in his previous answer, but if the UK signs a trade deal without a territorial clause defining the border between Israel and Palestine, it will be seen in legal terms as equivalent to letting Israel decide by default to include its settlements in the Occupied Palestinian Territories as part of Israel. Is the Minister aware that that risks a situation where, in effect, the UK recognises illegal settlements in the west bank as part of Israel, which is counter to the Government’s stated policy?

[Nigel Huddleston]

I refer the hon. Lady to the answer I gave a moment ago, but I wish to reiterate that it is long-standing UK foreign policy that Israeli settlements beyond the 1967 boundaries are illegal.

[Neale Hanvey (Kirkcaldy and Cowdenbeath) (Alba)]

8. What recent assessment her Department has made of the potential effect of the UK’s withdrawal from the European single market on business and trade.

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[The Minister for International Trade (Nigel Huddleston)]

The UK is absolutely committed to enhancing trade with Morocco. In 2022 we did about £3.1 billion-worth of bilateral trade—up nearly 50% on 2021—and we are using our association agreement with Morocco to boost that even further. In February I visited Morocco and met my counterpart to discuss how we can maximise trade, including by tackling barriers in priority areas such as education, renewable energy and infrastructure. We are also supporting British businesses to take advantage of the significant opportunities in Morocco, including through £4.5 billion of available finance through the excellent UK Export Finance.

[Mr Speaker]

I call the shadow Secretary of State.

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[Greg Smith (Buckingham) (Con)]

T4.   The Abraham accords have ushered in unparalleled opportunities by lowering trade barriers in the middle east, so how can my hon. Friend maximise the trade potential of the 2030 road map for UK-Israel bilateral relations by engaging with the wider region?

[Nigel Huddleston]

Through our road map, the UK and Israel reaffirmed the historical significance of the Abraham accords—which have the potential to bring about advancements to security, co-existence, peace and prosperity for the region—and our commitment to work together to deepen and expand those developments, building on the progress of the Negev summit in March 2022. Through the Britain-Israeli investment group, we will also combine UK and Israeli expertise to help solve regional technology and sustainability issues right across the world.

[Mr Speaker]

I call the SNP spokesperson.

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[Marion Fellows (Motherwell and Wishaw) (SNP)]

T2. The Fresh Produce Consortium, which represents 70% of the UK’s fresh produce supply chain, recently warned that post-Brexit import charges will hit small and medium-sized enterprises the hardest. Does the Minister accept that the post-Brexit trade deals are driving up already soaring food prices, as well as hitting small food producers at a time when they are facing real difficulties as a result of increased operating costs?

[Nigel Huddleston]

It should be transparently clear that the UK is conducting trade deals that are in the UK’s economic interests. That is the criterion: we would not do them if they were not in the UK’s interests. We are therefore working really hard, with a particular focus on opportunities for SMEs to trade not only with the EU but right around the world, where there are immense opportunities for further trade. We will continue to pursue opportunities in south Asia, Africa and South America—all over the world—where we have not taken full advantage of those opportunities. This will benefit many SMEs, including food and beverage producers, in the long term.

[Richard Graham (Gloucester) (Con)]

Over a third of the value of every Airbus sold in the world comes from the United Kingdom’s aerospace manufacturing—whether it is wings, engines, landing gear or other avionics—but all of the Airbus sales are recorded in international statistics as exports from France because the final take-off is from Toulouse. What can the Department do to try to make sure that the value of these exports, especially to the fast-growing Asia-Pacific region, is recognised as being partly from the UK?

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[Jim Shannon (Strangford) (DUP)]

When it comes to increasing trade with African countries, what steps are being taken to ensure that increased trade is carried out with companies that take human rights seriously and are ethically aware in the treatment of their workers?

[Nigel Huddleston]

We are an advocate around the world for human rights. That is something that the Government take seriously and discuss across Government, including with trading partners with whom, as I said, we can have frank conversations. Through other bodies and institutions, including the work done by the Commonwealth, we continue to have those frank conversations.

UK-India Free Trade Agreement Negotiations

Nigel Huddleston Excerpts

Tuesday 20th June 2023 Written Statements

[The Minister of State, Department for Business and Trade (Nigel Huddleston)]

The10th round of UK-India Free Trade Agreement (FTA) negotiations began on 5 June and concluded on 9 June. As with previous rounds, this was conducted in a hybrid fashion—UK officials travelled to New Delhi for negotiations and others attended virtually.

Technical discussions were held across 10 policy areas over 50 separate sessions. They included detailed draft treaty text discussions in these chapters.

The UK-India trade relationship was worth £36 billion in 2022. A balanced deal which respects the domestic sensitives of both sides will strengthen the economic links between the UK and India, boosting the UK economy and bringing benefits to UK businesses, families and consumers. In this negotiation, as with all our FTA negotiations, the NHS and the services it provides are not on the table.

Both sides continue to work towards a modern and comprehensive agreement. We will only sign a deal that is fair, balanced, and ultimately in the best interests of the UK.

The 11th round of negotiations is due to take place in the coming months.

The Government will continue to keep Parliament updated as these negotiations progress.

[HCWS865]