European Union (Withdrawal) Act
Debate between Seema Malhotra and Liam Fox(5 years, 10 months ago)
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Dr Fox
As usual, my right hon. Friend makes her point concisely. The argument has come from a wide range of business sectors that, while they can price in risk, they cannot price in uncertainty, and certainty is what they are looking for.
It is a matter of fact that the relative importance of the European Union as an export market for the United Kingdom has been declining over the last decade, falling from 48.9% of the total in 2010 to 45.2% in 2017. Of course, the importance of the UK to EU trade varies from country to country. Figures compiled by Japanese investment bank Nomura show that Belgium’s economy is the most reliant on trade with the UK, with around 8% of Belgian GDP dependent on trade with Britain. That is the highest level within the EU27. Belgium exports over £30 billion-worth of goods to the UK, which is Belgium’s fourth largest export market. Belgium’s Finance Minister has previously called for a quick trade agreement with the United Kingdom post-Brexit to protect thousands of jobs in that country. When trade is looked at purely in terms of exports, Ireland is the most exposed country—about 13% of all Irish exports end up in Britain—and the Netherlands also has a large reliance on the UK for exports and GDP.
At the same time as the proportion of Britain’s exports to the EU has fallen, we are trading more with other partners around the world. We export a huge variety of commodities—for example, we sold £22 billion-worth of food, feed and drink abroad in 2017. In the year to November 2018, we sold £33.7 billion-worth of cars, £25.2 billion of medicinal and pharmaceutical products, and £24.6 billion of mechanical power generator products—from aircraft engines to gas turbines, and from steam generators to nuclear reactors. So much for Britain not producing anything any more; we are actually experiencing a renaissance in manufacturing in this country.
We also export a great many services. We are, in fact, the world’s second largest services exporter. In the year to September 2018, we sold some £82.4 billion-worth of business services, £61 billion of financial services and nearly £38 billion of travel services. Here, across the sectors, the UK has huge comparative advantage. Services account for almost half of all our exports—42.4% going to the EU and 57.6% to non-EU countries.
Seema Malhotra
The Secretary of State is making a very important point about our need to increase trade deals and trade relationships across the world. He has mentioned India, and on Friday I had a very good meeting with businesses in the Indian Business Network that are keen to increase trade with Britain. Does he agree with me that the relationship we have with the EU in trade is not just about our trade with the European Union? We use about 70 trade deals that the EU has negotiated with other countries for about £150 billion-worth of trade. Will the Secretary of State assure this House that there will still be access to those trade deals after we leave the European Union?
Dr Fox
I am grateful to the hon. Lady for raising a very important point. Yes, the Government’s intention is, of course, that we will get this deal through, in which case, when it comes to an implementation period, we will have the opportunity for automatic roll-over. However, as the House would expect us to do, the Government are also preparing, in case there is no deal, to be able to have continuity of these trade agreements. A number of them are close to being signed, and when they are signed, the Government will put them to the House so that the House can make a judgment on them.
Oral Answers to Questions
Debate between Seema Malhotra and Liam Fox(5 years, 11 months ago)
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Dr Fox
My hon. Friend raises an important issue, which she has also raised in the Committee. The Government are looking at ways in which we can improve scrutiny without undermining the confidential nature of the discussions that we have. I will want to discuss the issues with the Opposition as well to see whether we can have a robust system that is also secure. That would be to the benefit of the whole House.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
A merry Christmas from Feltham and Heston to you, Mr Speaker and to everybody else.
This week, I attended an interesting seminar by Global Policy Insights on trade with the Commonwealth pre and post Brexit. The Commonwealth accounted for 8.9% of UK exports a couple of years ago—roughly the same as UK exports to Germany. Could the Secretary of State update the House on what discussions his Department is having with Commonwealth nations on the potential of free trade agreements and on what success he is having?
Dr Fox
The hon. Lady raises an important point. Of course, we have a number of agreements already with a number of Commonwealth countries and groups of Commonwealth countries, and we are close to signing one, which we will announce to the House shortly. However, we are also concerned about the level of intra-Commonwealth trade and how we can use that very large population, often with common legal rules, to enhance it. At the Commonwealth Heads of Government meeting in London, we set out our plans for a trade audit tool to help improve it, and we have had very positive engagement on that. There is tremendous opportunity inside the Commonwealth to allow countries to trade their way out of poverty, and we intend to ensure that that is made possible.