UK-Israel Trade Negotiations

Ruth Cadbury Excerpts

Thursday 20th January 2022 Westminster Hall

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

It is a pleasure to serve under your chairship, Mr Paisley. I congratulate the hon. Member for Harrow East (Bob Blackman) on securing this debate. I hope he will pass on our thanks to his fellow members of the Backbench Business Committee for allowing us to have this debate. I thank the hon. Member for Hendon (Dr Offord) for graciously saying that we do not all have to come back here again next Wednesday morning. Otherwise, I would be reusing, rather than recycling, my speech. I also thank the other speakers we have heard so far, and I will try to refer to them all during my speech. I refer Members to my entry in the Register of Members’ Financial Interests, as I have previously visited Jerusalem, the west bank and the Knesset as part of a parliamentary delegation.

Successive Israeli leaders, from Golda Meir to Yitzhak Rabin, were proud members of the Israeli Labour party and proud socialists. In the case of Yitzhak Rabin, he was murdered because of his historic work and commitment to peace through the Oslo accord. The British Labour party has strong and historic links with Israel through the Israeli Labour party.

It is in that spirit that we welcome and support increasing and improving the UK’s trade links with Israel. Of course, we welcome any trade deals that support jobs here in the UK and British businesses. That is why our Government should be taking advantage of trade with countries such as Israel—to ensure that UK exporters and businesses can do well and that British business can bounce back after the pandemic.

Speakers today have pointed out that the UK and Israel are two of the world’s most high-tech economies. That is surely a benefit, and a key issue, as speakers have said, in future negotiations with Israel.

The total trade in goods and services with Israel was worth £4.6 billion in the last available figures. I thought that Israel was the UK’s 40th largest partner, but the hon. Member for Strangford (Jim Shannon), who has temporarily left the room, said it was 42nd. Either way, as the hon. Member for Airdrie and Shotts (Ms Qaisar), the SNP Front-Bench spokesperson, said, this is a proportionately small amount of the UK’s total trade. Let us get these things in proportion.

UK exports to Israel are, however, worth more than £2 billion and support about 37,000 jobs in the UK, including, as speakers have said, many in skilled manufacturing industries, such as the car industry, but also technology, health-tech, security, data and so on. According to Her Majesty’s Revenue and Customs, 6,600 VAT-registered businesses currently export goods to Israel. I would welcome the Minister’s providing further information about what targets the Government want to reach for the number of businesses exporting to Israel in the future. I am talking about both the level of jobs and the level of investment. Is that a target for any future trade negotiations? There are also a number of important areas where Israel provides crucial imports for consumers here in the UK. That is especially the case, as others have said, in relation to pharmaceuticals and companies such as Teva, whose largest customer is of course the NHS.

There are other business links. The hon. Member for Harrow East mentioned the tech hub run through the UK embassy and the importance of technology and data in the economy. The hon. Member for Southport (Damien Moore) told us about the trials of the very interesting camera that people swallow for cancer checks and about VR training. The hon. Member for Buckingham (Greg Smith) mentioned digital security, which I did not know about. It is very important for any of us—all of us—who have bank accounts and do our banking online and on our phones. He also mentioned tourism, which is of course an important source of business for Israel, and of course for Palestine, because in and around Jerusalem we have the holiest sites for the three largest monotheistic religions in the world. Also, the world centre for the Baha’i faith is in Haifa, I think.

Additionally, more than 300 Israeli high-tech companies have bases in the UK, with 100 of those having been established in the last decade. Those firms bring jobs and investment to the UK. I look forward to hearing from the Minister about what steps the Government are taking to support our tech industry and to build strong partnerships between UK and Israeli tech hubs.

The Government have recently signed a further deal with Israel, which builds off the continuity FTA signed in 2019. This “road map” commits to further action around issues ranging from cyber-security to improving business links through the UK-Israel innovation summit in March of this year. We welcome these steps and hope that our Government continue to work with the Israeli Government on these important bilateral issues. The memorandum of understanding says that the UK and Israel will work on the

“development of a new, higher ambition free trade agreement.”

I look forward to hearing more details from the Minister about this and the benefits it could bring to so many sectors of our economy in the UK. We want trade deals that support well-paid and skilled jobs here, and we will support those that do so, as an Israel trade deal would.

It is equally important, however, that the Government ensure that human rights issues are considered and addressed when any trade deal is being struck. Trade should not happen in a vacuum, and British values are important in our trade deals. Around the world there has been a worrying pattern of the Government seeming to adopt an “any deal will do” approach, with key issues being jettisoned and ignored. We have already seen evidence of this in the Government’s recent deal with Australia, with British farmers thrown under the bus. I am extremely concerned that in future negotiations, such as those with the Gulf Council, human rights and rule of law issues could be cast aside. The Minister for Trade Policy did not take the opportunity this morning to answer my question about the Gulf Council deal.

The SNP Front-Bench spokesperson, the hon. Member for Airdrie and Shotts, made a number of key points about human rights and illegal settlements. Illegal settlements are possibly the top human rights issue, and they are in breach of international law. We have seen their continued expansion at a rapidly increasing pace, especially since the start of the Trump Administration in the US. Our Government must object in the strongest possible terms in all relevant forums, not least in trade negotiations, to the expansion of illegal settlements.

We know that settlements in the occupied Palestinian territory are illegal in international law, and that includes settlements in East Jerusalem, as well as in the west bank. United Nations Security Council resolution 2334 states that

“the establishment…of settlements in the Palestinian territory occupied since 1967…has no legal validity and constitutes a flagrant violation under international law”.

These settlements entrench divisions, and I know from meeting Palestinians when I visited the west bank that these settlements make a just and lasting peace deal even harder to achieve. I was told that around five years ago, and I fear the prospects have only got worse since then.

The recent change of Government in Israel offers an opportunity for a change in approach, especially as the previous Government’s formal proposal in which they threatened to annex the west bank has been stopped after widespread and near universal opposition, including from parliamentarians across all parties here in Westminster. Although the formal annexation has been stopped, the expansion of illegal settlements continues, and Palestinian families in East Jerusalem and the west bank continue to experience eviction from their homes and even demolition of their homes and property.

Both the EU’s agreement and the subsequent continuity agreement between the UK and Israel mandated that goods from illegal settlements would be excluded from the preferential terms of any UK-Israeli trade agreements. On this issue, I have a few questions for the Minister. First, will he confirm that the UK Government still support the principle of non-preferential trade for goods from illegal settlements, and will the Government uphold that non-preferential treatment in any future FTA or deal with Israel? Secondly, are the Government aware of the current level of known UK trade with Israeli settlements? Additionally, will the Minister make it clear that British companies have an obligation to ensure that their products and services are not used in grave breaches of international law?

I know that some people have called for the UK to block all trade with Israel, but that is not an action that we support. Such an indiscriminate measure would hurt millions of ordinary Israelis and Palestinians, both in Israel and in the west bank and Jerusalem, and it is not a policy applied to other countries. We do not support a ban on goods from the state of Israel, nor do we support the policy of boycott, disinvestment and sanctions, which is often known as BDS. The hon. Member for Hendon explained how the boycott has affected Palestinian businesses. They already suffer from a lot of difficulties, and this boycott could make things even worse. I therefore share the concerns about BDS that were raised by the hon. Members for Harrow East, for Southport, for Buckingham and for Hendon and others in this debate.

In the wider context of our overall relations with Israel, the Labour party insists on a renewed focus on negotiating a two-state solution that ensures a viable and sovereign Palestinian state alongside a safe and secure Israel. We welcome the Government taking this step towards a new free trade agreement with Israel, which we hope will benefit UK businesses and consumers, but we also want to ensure that the Government address the key issues around human rights and specifically those relating to settlements. I look forward to the Minister’s response.