Sanctions and Anti-Money Laundering Bill [HL]

Viscount Waverley Excerpts

2nd reading (Hansard): House of Lords
Wednesday 1st November 2017 Lords Chamber

[Viscount Waverley (CB)]

My Lords, I offer my support to government objectives at this stage of the Bill, because continuity of current arrangements is clearly an imperative. I have, however, listened carefully to the concerns of noble Lords, and I hope that the Government are on message. We have heard from the Minister that flexibility would allow Ministers to add differing components. That is helpful. He mentioned transport, trade and immigration. However, any mechanism to specifically place more emphasis on removing corruption from the world stage, alongside that on money laundering, would be propitious for inclusion in future sanctionable objectives. The noble Lord, Lord McNally, touched on that point twice in his remarks.

Defining corruption can be a nebulous challenge, but it often extends to poor governance. It is essential to exert pressure to improve governance where needed, particularly in relation to the recipients of UK aid funds.

The use of sanctions for economic or regime change purposes, or targeted sanctions on individuals for human rights abuses—a mechanism short of more drastic measures—is on the increase. Understanding how best to measure those sanctions against their intended purpose and ensure that the unintended do not suffer disproportionally, and when expedient how to allow leaders on the receiving end to save face, are all challenges. The need is sometimes to allow or provide an assured exit route for those facing international justice or a route back to a state of peace and reconciliation for conflicted peoples.

I would welcome a global review of sanction processes at a convenient time in the future. Knowing when and how to instigate sanctions as a tool of policy does not require multilateral-level consideration by a body such as the United Nations. More effectively, it should be introduced by smaller and more coherent regional or economic groupings, such as the G7 and European Union members. Regional fora to discuss and implement sanctions have the benefit of speedier action without as much compromise on principles compared with the UN. Many crises require more timely responses while UN bodies conduct their reviews and investigations. On another note, regional groupings carry more weight in terms of “who is in the right”, as typically those in regional groupings are neighbours. For example, African Union sanctions on African states could carry more moral weight, as it is not seen as a group of western nations punishing a poor African state. I took note of this general theme when listening to the vehement remarks made recently in your Lordships’ House by his excellency the President of Namibia.

The underpinning of sanctions as a transatlantic set of initiatives is fundamental. This might serve also as a brake on occasional future excesses by the United States.

We must all be in step. If in step, what should be done about the effects of extraterritorial components unilaterally instigated by others—for example, the US Helms-Burton legislation, a United States federal law which strengthens the United States embargo against Cuba? Whether it be Cuba or elsewhere, it is often western banks and companies—notwithstanding the desperate tale outlined by the noble Lord, Lord Hain, who is not in his place—which, against their individual corporate interests and without consultation, shoulder the burden.

However, the overall balance must be got right. We are headed possibly towards a differing geopolitical and geo-economic world. Care needs to be exercised for sanctions not to become a “them and us” circumstance. Some suggest possible future axes of those to the East standing between themselves and the ideals of the West are in the making.

While a clear set of objectives exist we should be mindful of states not being boxed into a corner or blind alley with little or no exit strategy. Any possible reciprocal sanctions programmes might have dramatic and untoward long-term adverse repercussions. If sanctions become a wedge between differing ideals, certain eastern economic powers might decide they are more in kilter with those in the East than the West. Presumed groupings and informal alliances are much more variable than we might think. So, sanctions achieving their end, and not beyond, are crucial.

I was struck recently by a comment from a UK Foreign Minister that encapsulates one aspect of the challenges. He noted that we live,

“not in a world where isolation works”.