WTO Ministerial Conference

– in the House of Commons at 4:31 pm on 7th November 2001.

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Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry 4:31 pm, 7th November 2001

With permission, Mr. Speaker, I should like to make a statement on the World Trade Organisation and the fourth ministerial conference that starts in Doha later this week.

Even before 11 September, a new world trade round was a high priority. Further expansion of world trade—free and fair world trade—offers the best opportunity to people in developing countries to escape from poverty. With the economies of Japan, the USA and Europe faltering, a new world trade round offered real benefits to the west as well. However, the atrocity of 11 September has made a new trade round even more important, both politically and economically.

In the past eight weeks, we have helped to create an extraordinary international consensus to fight terrorism and strengthen world security. We must, however, also fight terror with trade. As the US trade representative Bob Zoellick has said, we need a global alliance for openness and fairness that

"understands that the staying power of the new coalition depends on economic growth and hope".

By launching a new world trade round in Doha next week, we will show that the nations of the world are determined to strengthen their security by sharing prosperity. We will also inject fresh confidence into a world economy that was further hit by the atrocity on 11 September.

A new round will bring benefits at home and abroad. As the world's fifth largest trader, for the United Kingdom the potential benefits of further trade liberalisation are considerable. On a global level, if we could just halve trade protection in both developing and the developed countries, we would boost world income by about $400 billion a year. That would mean an increase in the wealth of developing countries of about $150 billion a year, which is about three times what they receive each year in development aid. The average income of every household in Britain would be boosted by almost £500 a year.

I shall be leading the United Kingdom delegation in Doha and will be joined by my right hon. Friends the Secretary of State for International Development and the Minister for the Environment and by my noble Friend the Minister for Trade and Investment. I am pleased to say that the United Kingdom delegation will once again include a representative each from business, the unions and other non-governmental organisations.

I should like briefly to outline our objectives at Doha. If this trade round is to be a success, we must put social justice and poverty reduction at its heart. That means the reduction and, where possible, the elimination of trade barriers, particularly those in developed countries that hamper exports from the developing world. It means agreeing rules that properly reflect WTO members' different levels of development and a sustained effort by the richer countries of the world to build the capacity of the developing countries to trade and to participate effectively in the WTO.

I am delighted that, earlier today, my right hon. Friend the Secretary of State for International Development announced a further increase in the United Kingdom's investment in capacity building in developing countries. Earlier this week, the Prime Minister wrote to the International Monetary Fund and the World Bank urging them to make a further joint commitment to help the least developed countries build their capacity to trade and to participate in the WTO.

The 49 poorest countries of the world account for almost 11 per cent. of the world's population, but less than 0.5 per cent. of the world's exports, and that tiny percentage has been decreasing. Those countries, which most need trade to raise them out of poverty, face significant trade barriers. That is why we in the European Union, through the everything but arms agreement, are giving the poorest countries in the world duty-free and quota-free access to our European markets for all their goods except arms. At Doha, my colleagues and I will be urging other WTO members to commit themselves to the same everything but arms objective—duty-free and quota-free access throughout the developed world for the least developed countries.

We must also ensure that people in the developing world get access to the medicines that they need. I know that that is a matter of concern to the whole House. Britain has already committed $200 million to the global fund to fight AIDS, tuberculosis and malaria, and since 1997 we have committed £1 billion to primary health care services in poor countries.

Developing countries believe, however, that the WTO's rules on intellectual property rights inhibit their access to essential medicines, particularly to deal with the devastating HIV/AIDS pandemic in southern Africa. It is important to ensure that intellectual property rights continue to provide an incentive for companies to keep on developing medicines, but I believe that by clarifying and properly using the flexibility provided within existing rules we can ensure that all Governments are able to act to protect the public during health crises.

Discussions on the form and content of the new round have entered their final stages. All parties have been spurred on to greater efforts to resolve their differences and reach agreement on the basis for launching a new round, but there are still some very tough issues that we shall have to tackle in the week that lies ahead. Let me refer briefly to the other elements in the new round that we view as a priority.

First, there is agriculture. We must make a real commitment to liberalisation, and linked to that is further major reform of the European common agricultural policy. Protectionism in all Organisation for Economic Co-operation and Development countries, including countries of the Cairns group that lead the cry against European subsidies, is estimated to cost developing countries some $20 billion a year.

Secondly, there is the environment. We strongly support European Union efforts to bring environmental issues into the negotiation. We want trade liberalisation to deliver environmental benefits, and we want to ensure that WTO rules do not undermine legitimate environmental policy; but we also want to ensure that environmental standards should not be used as a form of back-door protectionism. Multilateral rules on trade and on the environment can work in a mutually supportive way, but we need greater clarity about the interaction between them.

Thirdly, we want to include negotiations on foreign direct investment and competition with a view to a simple, basic framework of rules based on transparency and non-discrimination. Those rules could give business a stable and predictable climate, and help developing countries to attract the foreign direct investment that they need.

Fourthly, there are services. We are the world's second largest exporter of services, so of course we want to open up markets in more service sectors; but let me make it clear that we have no intention of making any commitments that could call into question our ability to maintain public services provided through the national health service or the state education system.

Finally, there are labour standards. As we expand world trade, we must also promote higher labour standards around the world. The International Labour Organisation is the right place to set those labour standards, but we shall be seeking a broader dialogue between the ILO and other international organisations, including the WTO.

Labour Members believe that social justice and a successful economy go together. That is what we are building here in Britain, and that is what we must achieve internationally: opening markets and tackling world poverty. The WTO meeting this week is a huge opportunity for 142 nations to move forward together at a time of great uncertainty. The United Kingdom is in a unique position to contribute, as an active player at the heart of the European Union, a strong ally of the United States, and a vigorous supporter of the Commonwealth. In Doha, we will use that position to help secure an agenda for free and fair trade—to launch a trade round that benefits Britain, but above all benefits the poorest people of our world.

Photo of John Whittingdale John Whittingdale Shadow Secretary of State (Trade and Industry)

I thank the Secretary of State for her courtesy in letting me have an advance copy of her statement. I also welcome the fact that she is making a statement at all. It is unusual to do so in advance of a meeting, but it is also helpful in that it provides us with a yardstick by which to measure the Government's success in achieving their objectives. I would also be grateful if she confirmed that it is her intention to make a further statement to the House once the conference is over.

I wish to join the Secretary of State in emphasising the importance of achieving a new world trade round. The expansion of global free trade will bring huge benefits, not only to us in this country but to the developing world, as she rightly said. There were some who suggested that the meeting in Doha might have to be postponed as a result of the terrorist attacks in America and the action that has followed them. I unreservedly welcome the decision not to postpone. The choice of the World Trade Centre as one of the targets for attack was deliberate and one of the ways in which we can best demonstrate our resolve is by going ahead with the conference.

The Secretary of State is right to say that the success of the trade round will be measured by the extent to which barriers to trade are reduced. But does she accept that to do so will involve some pain and sacrifice on the part of all concerned? Does she recognise that the last set of talks in Seattle was a disappointment, and that by insisting on a broad agenda little of substance was achieved at all? Does she agree that, contrary to the views of some well meaning—and indeed some less well meaning—organisations, the biggest losers from that failure were the countries of the developing world? Does she accept that under the existing rules it may prove almost impossible to achieve consensus among all members, and that the WTO itself may now therefore be in need of serious reform?

Does the Secretary of State recognise that while the European Union has achieved much in terms of reducing barriers to trade between member states, the EU still maintains some 15,000 tariffs against countries outside the European club? Does she accept that the EU common tariff wall not only costs European consumers a huge amount but is depriving developing countries of vital opportunities to export to our markets? At the same time, will she accept that if we are to open up our markets to more competition, it is equally important that the Government act to improve the competitiveness of British industry, rather than reducing it by imposing ever more tax and regulation?

The Secretary of State rightly identified the need for liberalisation in agriculture as a key priority. But will she accept that despite the commitments made at successive European summits, very little has been achieved? Can she say what progress has been made in persuading some of the more recalcitrant EU member states to make the reforms that are necessary?

On services, does the Secretary of State recognise that a balance needs to be struck between trade liberalisation and proper consumer protection? Does she also accept that an equal balance is necessary with the concerns of environmental protection, but that it is vital that neither issue should become an excuse to prevent agreement?

On intellectual property, will the Secretary of State recognise that intellectual property rights are not a form of protectionism but necessary to encourage and reward research and development? Does she acknowledge that weakening those rights risks reducing pharmaceutical research and development and slowing medical innovation? Can she say what discussions she has had with our European partners on that matter; and can she confirm that it is the Government's view that the main responsibility for making cheaper medicine available to the third world should rest with Governments, not the pharmaceutical industry?

Finally, can the Secretary of State say what will be the effect of China's joining the WTO? Does she agree that the opening up of China's markets represents a tremendous opportunity, but at the same time is bound to have tremendous implications for enterprises in that country?

Doha represents an immense opportunity to boost economic prosperity throughout the world. I therefore end by wishing the Secretary of State and her colleagues every success. We look forward to her report back to the House.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I thank Mr. Whittingdale for the courteous welcome that he has given my statement. I thank him too for the good wishes that he has expressed, to me and to the delegation. I considered that it would helpful to inform the House of the Government's negotiating position at Doha, and in the same way I can confirm that I shall report back on the outcome of the talks after the conference has taken place.

The hon. Gentleman raised an important point about decision making in the World Trade Organisation. There is no doubt that one of the hard lessons learned at Seattle was that all WTO members—and the organisation is very large—must be able to participate fully in the decision-making process. We think that that can best be achieved by building consensus and by improving communication, both inside the organisation itself and with external bodies.

The work undertaken in the WTO general council in Geneva has already gone a long way to achieving that greater openness. All WTO members are conscious that the negotiating process at Doha needs to be more transparent and inclusive for all member Governments than was the case at Seattle. However, we shall continue to seek ways to formalise those improvements in the WTO's ways of working, in parallel with establishing a new trade round.

The hon. Gentleman also raised the issue of tariffs in the European Union, which are immensely damaging to developing countries seeking to export their way out of poverty. As I made clear in my statement—and as Commissioner Lamy has made clear on behalf of the EU—we are and must be prepared to negotiate reductions in many of those tariffs, or their elimination, as part of a new round. Through unilateral action, we have already done the same in relation to the everything but arms initiative, to which I referred earlier.

The hon. Gentleman also mentioned those businesses in Britain and elsewhere in the EU that fear competition from lower-wage countries in the developing world. It is essential that we support those companies, and above all their workers. By helping them to move to higher value-added production, we can remain competitive with the rest of the world.

In the textile sector, for instance, the work force and some businesses are especially concerned about the impact of the phasing out of the multi-fibre agreement. We are already working with business and the trade unions to improve the productivity and competitiveness of the sector, in particular by helping businesses move into the field of technical textiles.

The hon. Gentleman mentioned, as I did, agricultural subsidies in the EU. I can confirm that we have been pressing our European colleagues on that matter for some years. Reform of the common agricultural policy is absolutely essential, not only because there is a need to agree a new world trade round, but also because we must move forward to enlargement of the EU. I agree with him about the need to strike a proper balance with regard to services and the environment.

In addition, I wish to underline what I said about the need to ensure that there is intellectual property protection for companies, given that pharmaceutical companies invest millions in the development of each new drug that they bring to market. There is no serious proposal on the table that the TRIPS—trade-related aspects of intellectual property rights—agreement should be renegotiated within the WTO.

We must act to improve access to medicines in the developing countries, and I described the other actions that we can take outside the WTO to make that possible. However, the pharmaceutical companies to which I have spoken recently made it clear that they too are willing to play their part in ensuring that cheaper medicines— even those under patent protection—are available in developing countries.

Finally, I agree with what the hon. Gentleman said about the enormous importance of China's accession to the World Trade Organisation, which we have warmly welcomed. That has enormous implications for world trade, as that country has the second largest economy in the world. We shall continue to work closely with the Government in China to ensure that the potential of its accession is fully recognised.

Photo of Mr Tam Dalyell Mr Tam Dalyell Labour, Linlithgow

I thank the Secretary of State for her seriousness of purpose, and also express my appreciation of the good sense—and, if I may say so, good parliamentary manners—of her coming to the House pre-conference rather than post-conference. Is she aware that both today and tomorrow a heavyweight delegation from the Philippines are guests of the Inter-Parliamentary Union, and that during discussions this morning its members stressed the problems of central Mindanao, where there is a serious dissident terrorist problem for both the Muslim and the indigenous community? They argued that if there could be trade in the tropical fruits of that area, and entry into the European market for that trade, many of the terrorist problems would probably be overcome.

We are the biggest investors in the Philippines, so at Doha, will my right hon. Friend make a point of asking her officials to contact the Filipinos? I know that the Deputy Chief Whip, my hon. Friend Keith Hill, has close connections with the railways, so he will be glad to hear that it was the British, from Plymouth and Scotland, who built the railways in the Philippines. My right hon. Friend the Secretary of State will not be astonished to hear that, when she comes back, there will be a question on the Order Paper asking what she has done by way of contacting the Filipinos about trade in fruits and related matters.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I am grateful to my hon. Friend for giving me notice of his question; perhaps I can give him notice of my answer. I was not aware that there was a delegation from the Philippines here at the moment, but I will certainly ensure that my officials, and if possible one of the Ministers, speak directly to the delegation while we are in Doha. Because of my visit to the Philippines some time ago, I am well aware of both the terrorist problem and the trade problem to which my hon. Friend refers, and I hope that we will be able to make an advance in that respect through securing a new round of negotiations at Doha.

Photo of Vincent Cable Vincent Cable Shadow Spokesperson (Trade and Industry)

May I add my welcome for the Secretary of State's timely statement, and take the opportunity to reiterate my belief that an open and liberal trading system, strengthened by this round, is exactly the way to counter the present crisis of confidence in the international economy, and particularly to help developing countries to progress through trade, which, as she rightly says, is the primary objective of the new round? I also ask her to go a little further and condemn some of the weasel words of her fellow Trade Ministers and Commission officials in Europe, who are still resisting the idea that radical trade liberalisation in agriculture and other protected sectors, such as textiles, has to happen, and that those product areas are crucial for all developing countries, not just the least developed. Will she also make it clearer than she did in her statement that although it is right to strive for enhanced environmental and labour standards, there is no economic or moral justification for allowing such barriers to be used as an obstruction to trade with countries that are too poor to afford those standards?

Finally, as the Secretary of State for International Development has joined her on the Front Bench, may I ask the right hon. Lady to emulate her colleague's forthright and occasionally courageous stance against some of the myths of the anti-globalisation movement, which are influential and do great damage? In particular, will she dismiss the fashionable myth that the World Trade Organisation exists to undermine public health and education, when it does nothing of the kind?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I have already said—I made the point in a speech yesterday—that well meaning though many, if not quite all, of them are, those who oppose world trade and the World Trade Organisation are doing a massive disservice to the people whom they believe they are helping—the people of the poorest countries in the world. I offer one illustration of that fact. Thirty years ago South Korea was a far poorer country than Nigeria. Today the people of South Korea are 30 times richer than the people of Nigeria. One reason is the very different approach to world trade pursued not only by South Korea but by countries in other parts of south-east Asia.

I have also made it clear, publicly and privately, as have my right hon. Friends, that we in Europe must stop dragging our feet on agricultural reform. We know from our experience of the foot and mouth crisis that reform of our farming system and our farming subsidies is increasingly urgent. As I said in response to the hon. Member for Maldon and East Chelmsford, it is also essential, in the interests of enlargement of the European Union as well as the interests of people in developing countries, that we reduce those agricultural subsidies.

We are already committed, as a result of the Uruguay round, to phasing out the multi-fibre agreement on textiles. As far as investment and competition are concerned, we are seeking to strengthen the rules that will enable much greater foreign direct investment—not speculative flows—in developing countries that urgently need that capital to improve their infrastructure.

I welcome the support of Dr. Cable for the position that we are taking at Doha.

Photo of Alan Simpson Alan Simpson Labour, Nottingham South

What consideration has the United Kingdom given to its negotiating position in relation to these talks? About three key elements and objections have been raised from the south. First, it is inappropriate to enter a further round of World Trade Organisation negotiations when the north has not honoured the promises made to the south in the Uruguay round.

Secondly, what consideration has the Secretary of State given to the representations set out in the document produced and published yesterday by 20 UK NGOs, in conjunction with their sister organisations in the developing world, as part of the Trade Justice Movement? The document points to the fact that liberalisation to date has amounted to little more than deregulation in the private interest rather than fair regulation in the public interest.

Finally, will the UK respond to the cries of the developing world to stop the destruction of its domestic agricultural systems by the dumping of subsidised food produce from the industrial world?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

My hon. Friend raises three important points. Although I understand the concerns of developing countries that we need to settle the implementation of the agreements entered into in the Uruguay round before embarking on a new one, I think that those concerns have, to a significant extent, been allayed by the progress that we have made, particularly in the past few weeks, on the outstanding implementation questions. About 100 of those issues have been considered in great detail in recent weeks in the World Trade Organisation and, in particular, between Commissioner Lamy and Ambassador Zoellick. At the recent meeting in Singapore, we made considerable progress on a first basket of implementation agreements addressing some of the most urgent concerns, and I believe that we can make substantial progress at Doha and in the context of a new round.

My hon. Friend referred to the concerns of the British NGOs, some of whom I met yesterday. We will, of course, have a representative of the development movement NGOs in the delegation, as well as representatives from the Confederation of British Industry and the Trades Union Congress. However, let me underline the point that I made in response to an earlier question. Non-governmental and development organisations sometimes misrepresent what is going on and what we are seeking to achieve in a new round. It is important to draw attention to initiatives such as the everything but arms agreement which has been and will be of enormous benefit to the least developed countries of the world, and which we are seeking to extend substantially through the new negotiations.

Thirdly, I agree with my hon. Friend about the damage that is done to domestic agriculture sectors in developing countries by the dumping of subsidised agricultural produce produced in the developed world. That is one of the reasons why we are pushing so hard in the talks for agriculture reform.

Photo of Tony Baldry Tony Baldry Chair, International Development Committee

Will the Secretary of State comment on reports that, at a meeting of the least-developed countries group last week in Geneva, concern was expressed that none of those countries' input was getting through to the draft Doha declaration? At the same time, Stuart Harbison was saying that the draft declaration was now final. Given that, within the politics of the possible, progress on trade-related intellectual property will be slow, can the Secretary of State confirm that the $200 million that the Government are giving to the global health fund is not a one-off payment, and that there will be further contributions in the future? It would be good news if the Secretary of State for International Development could also confirm that.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

The hon. Gentleman has enormous expertise and commitment on these matters. We— with my right hon. Friend the Secretary of State for International Development—are trying to ensure that the global health fund works effectively in starting to address the needs of people in the developing countries for access to medicine. If it does we shall of course seek to increase the size of the fund.

The ability of the least-developed countries to contribute directly and to have their voice heard in the WTO negotiations is important. That is one of the reasons why my right hon. Friend has been increasing so substantially UK investment in capacity building in those countries, so that they can have a more effective voice in the WTO. I assure the hon. Gentleman that both my right hon. Friend and I will continue to ensure that the voice of those countries is heard during the negotiations in the week ahead.

Photo of Mr Harry Barnes Mr Harry Barnes Labour, North East Derbyshire

The third world needs access to resources, and measures to stop the further undermining of their economies. The Secretary of State will be aware that one proposal is that there should be an international tax on currency speculation, including chasing money in tax havens—something we now say that we can do because of bin Laden. The tax is known as the Tobin tax, although Tobin himself may have gone off the idea a bit. Such a tax would dampen down speculation and raise massive resources. Should it not be discussed at the WTO—at least in an exploratory form—since some Governments have begun to take it on board, and especially since Tobin initially thought that the WTO could be one of the avenues through which the tax could operate?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

As my hon. Friend rightly says, James Tobin seems to be rather sceptical about his idea, so we may have to rename the Tobin tax—[Hon. Members: "The Barnes tax."] Indeed, the Barnes tax. Perhaps I can reassure my hon. Friend: as the Chancellor recently made clear, the proposal for a Tobin tax, or for some system that would raise revenue internationally and dedicate it to world development, is already being discussed, within ECOFIN at European level, and also internationally, in the United Nations and the OECD.

Photo of Adam Price Adam Price Plaid Cymru, Carmarthen East and Dinefwr

The Secretary of State stresses the need to bring benefits to the poorest countries, with which I am sure we all agree. However, in that case, I fail to understand why she does not even consider as serious the proposals that many developing countries should have a public health exemption from international patent rules, thus enabling those poor countries to import cheap drugs to protect their citizens—much as the United States has been able to do recently with the anti-anthrax drug, Cipro. It will be interesting to learn what discussions she holds with the Secretary of State for International Development on that vital issue. Will the Secretary of State for Trade and Industry promise the House that she will bring pressure to bear on her American colleagues to ensure that the same trading concessions are given to Nigeria, India and other textile-producing countries as to Pakistan; or will the rules of trade continue to be based not on justice and equity but on the economic self-interest of the west?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

The hon. Gentleman raises two important points. We believe that the flexibility that already exists in TRIPS within the WTO rules enables the Governments of developing countries to obtain the medicines that they need to care for their people during a public health emergency. One of our objectives at Doha is to ensure that that is sufficiently well understood and clarified to enable us to reach agreement.

I remind the hon. Gentleman that if we simply set aside intellectual property rights we will destroy the incentive for pharmaceutical companies to invest massively in the research needed to develop new drugs to deal not only with diseases in the developed world but with the diseases of poverty.

I am sure that the hon. Gentleman recognises the considerable efforts and risks that the Government and people of Pakistan are taking in relation to the terrorism of Osama bin Laden and the Taliban. He will also recognise the real efforts that the authorities in Pakistan are making to deal with the menace of drugs. It is in recognition of both facts that the European Commission has recently made a proposal, which we support, for bilateral improvements in the textiles arrangements with Pakistan. I certainly hope that the United States of America will take a similar position.

I fully understand the concerns within our own industry on that subject, and I recently met the employers and KFAT, the National Union of Knitwear, Footwear and Apparel Trades, to discuss the subject. It is appropriate that we recognise the efforts that Pakistan is making and take further steps, along with those that we shall be taking in the WTO, to assist Pakistan to export in a sector that is of enormous importance to it.

Photo of Mr Roger Casale Mr Roger Casale Labour, Wimbledon

I thank my right hon. Friend for her statement and welcome the emphasis that I know she will place, on behalf of the British Government at Doha, on using any forthcoming trade round to eliminate poverty around the world, and allowing the world's poorest economies to develop their potential through trade at the same time as we move to unshackle the world's poorest societies from the unmeetable and unbearable burden of debt. Does she share my concern that, despite the popular impression that the process of globalisation is accelerating, we are experiencing not only a global slowdown in economic growth around the world but, critically, an even greater slowdown in the growth of trade as a share of world output? Is it not the case that trade liberalisation must be an overriding imperative for the world community, not least because global recession would have catastrophic consequences for the world's poor?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I agree with the point that my hon. Friend has made. We face a real slowdown in economic growth, in trade and in foreign investment, especially in the developing countries. The real disaster would be if, in response to the economic slowdown, the countries of the developed world were to retreat into isolation and protectionism. Our best response to the economic slowdown as well as the terrorist attacks is to advance the cause of free and fair world trade, in the interests of the developing countries above all but also of the west.

Photo of Andrew Lansley Andrew Lansley Conservative, South Cambridgeshire

The Secretary of State will be aware that the linkages between issues are some of the most important aspects of the trade round. May I invite her to add a little more on the question of the linkage between the European Union proposals for the reduction or elimination of tariff barriers and the desirability of increasing the effectiveness of competition authorities in other countries? She said that they should be non-discriminatory and transparent, but will she also make it clear that they should be independent and effective? If they are not, there is a risk that anti-dumping measures will be adopted as a way of reintroducing some of the protection that is otherwise forgone.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

Anti-dumping is one of the largest issues in the implementation basket that we have to consider, and the point that the hon. Gentleman makes about the need for effective competition authorities is absolutely right. If we can achieve more effective regimes for competition and investment across the world, we shall create a much better climate for foreign direct investment around the world. However, we must also recognise that, for developing countries with very little governmental capacity, those are difficult new issues that we are asking them to take on. I believe that we shall make progress on that at Doha, but we shall then need to reassure developing countries that we are not asking them to do too much, too quickly—again, another reason why my right hon. Friend the Secretary of State for International Development has been boosting our investment in capacity building.

Photo of John Battle John Battle Labour, Leeds West

Every day, poor countries lose some £1.4 billion because of unfair trade rules, while a quarter of the world's wealth is owned by 200 transnational corporations, so more just trade rules are crucial. Although I generally welcome my right hon. Friend's positive approach to the Doha conference, may I tell her not to put all her faith in improving and getting fairer international trade rules and urge her also to encourage and support local and regional trading, which is vital to poorer countries' economies?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I entirely agree with the points that my hon. Friend makes. Local and regional trading agreements are not an alternative to the multilateral trading agreements that we can achieve through the World Trade Organisation, but as our own experience in Europe demonstrates, they are none the less extremely important, especially to developing countries, for which they undoubtedly represent the best route out of poverty.

Photo of Christopher Chope Christopher Chope Shadow Spokesperson (Treasury)

Will the Secretary of State tell us what specific proposals the European Union has to put on the table at the conference in relation to liberalisation in trade in food, which is fundamental to resolving world poverty issues? Will she tell the House how many of her 14 colleagues from other EU countries she thinks support her commendable philosophy of world trade liberalisation?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

Of course, the EU and the European Commissioner negotiate in the WTO on behalf of all 15 members of the EU. Commissioner Lamy, to whom I pay tribute for his work so far, is clear about the negotiating remit that the EU has given him and about the need to secure agreement on moving forward on agricultural liberalisation. There are non-trade issues, including animal welfare, about which the European public have expressed real concern, but, as with environmental issues, the developing countries can view them as thinly disguised protectionism, and we need to reassure them about that. Of course, the specific proposals will be a matter for the negotiations themselves. Our objective at Doha is, in effect, to agree the terms of reference for that new round.

Photo of Judy Mallaber Judy Mallaber Labour, Amber Valley

My right hon. Friend has referred to the concerns expressed in the clothing and textiles sector. Will she expand on what issues relating to the sector she thinks may be raised during the talks—and what is the Government's position on them?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I pay tribute to my hon. Friend for the work that she has done with the textiles industry, which is enormously important in her constituency and, indeed, in mine. The textiles issue is immensely important to developing countries, which is why they seek further liberalisation and, in particular, a reduction of tariff barriers in the western countries, and we will consider that issue very carefully. As I said in my recent discussions with industry and union leaders, we will also consider ways in which we can work even more effectively to ensure—as quotas are phased out, which we have already undertaken to do, and as tariffs are reduced—not only that the industry can move even more effectively into more advanced and higher-value-added products but that any tariff reductions that we make are matched by tariff reductions in developing countries, enabling our industry to gain access for its products to new markets in other parts of the world.

Photo of Mr Richard Allan Mr Richard Allan Shadow Spokesperson (Business, Innovation and Skills), Shadow Spokesperson (Trade and Industry)

I am pleased that the Secretary of State referred to intellectual property, but disappointed that it is not one of the United Kingdom's priorities for Doha. Does she recognise that the concentration of intellectual property rights in the wealthiest countries could be harmful? Although the intellects that lie behind the property come from all over the world, the rights invariably end up in the home countries of the largest companies. Is she worried that the structural inability to develop strong portfolios of intellectual property in some developing countries may work against their need to reduce poverty?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

The hon. Gentleman raises an important point. Many developing countries are concerned about the impact of intellectual property rights on traditional knowledge, especially in medicines and health. We are considering that, as is the World Trade Organisation. I hope that we will make progress on that as a result of the Doha negotiations.

Photo of David Taylor David Taylor Labour/Co-operative, North West Leicestershire

Does my right hon. Friend agree that the WTO far too often reinforces the existing competitive advantage of developed nations? Do not some of the proposals for further trade liberalisation at Doha breach basic rules on cultural diversity, environmental sustainability and respect for human rights? If so, what will she do about that in the delegation?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

I regret to say that I do not agree with the assumption underlying my hon. Friend's question, although I am aware of his concerns. Doha will allow us to identify much more effectively how we ensure that further liberalisation of world trade works to the advantage of the environment, development and, therefore, human rights. That is our goal. The development that has occurred in many parts of the world as a result of world trade liberalisation in the past 50 years is a sign that if we continue to build an effective World Trade Organisation and strengthen the rules for free and fair trade we can achieve the objective of spreading sustainable prosperity across the world.

Photo of Ann McKechin Ann McKechin Labour, Glasgow Maryhill

I thank my right hon. Friend for her commitment to openness and fairness in the next round of trade negotiations this week. I accept, as I am sure she does, that there is no level playing field in the trade between the south and north. She will appreciate the concerns of developing countries about the benefits of the WTO negotiations. Will she support their demand for an independent impact assessment of the WTO policies before we press the south for further liberalisation of its trade?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Trade and Industry

It is important to assess the impact of trade liberalisation measures, and work is being done on that. However, for some measures—for example, in relation to textiles—it will not be possible to get full evidence on the impact of liberalisation until we have concluded the phasing out of the multi-fibre agreement in 2005. I am sure that more can be done, especially within international agreements, to build up an assessment of the impact. Let me stress, however, that there is already good evidence of the beneficial impact of fair trade on developing countries, which should enable us with confidence to agree the beginning of a new round of negotiations at the ministerial conference this week.