I beg to move,
That this House
shared the concerns of the Trade Justice Movement about the plight of the poorest people in the world, and congratulates them on bringing these matters to the attention of the public;
notes with great concern the increasing levels of hunger and poverty in many developing nations;
further notes that international development targets are not being met in Africa;
recognises the depth of public concern on this issue;
believes that increasing levels of international trade offer the greatest hope for the alleviation of hunger and poverty in history;
further believes that the removal of trade barriers will promote economic growth, trade and investment in poor nations;
supports the liberalisation of trade;
is concerned that the Common Agricultural Policy is failing both British farmers and consumers, and harming farmers in poor countries;
is also concerned at the rising levels of farm subsidies in America;
and calls on the Government to use the forthcoming G8 Summit in Canada, the EU Heads of Government Meeting, and future World Trade Organisation meetings to further the liberalisation of international trade to promote the alleviation of poverty and combat hunger and starvation amongst the poorest people on earth.
Before I begin my speech, I should like to welcome Ms Keeble to her new post as Under-Secretary of State for International Development. I very much look forward to debating international development issues with her. I enjoyed my debates with her predecessor, and I am sure that the Under-Secretary's knowledge of South Africa will be a great asset to her.
Given that 10,000 people from every corner of the United Kingdom have come to lobby Parliament today, I am delighted that Her Majesty's official Opposition have chosen to debate an issue that clearly matters to British people. We congratulate the Trade Justice Movement on bringing the matter to the attention of the public. We may not agree with everything for which the movement calls, but we share its concern for the plight of the poorest people in the world. The movement recognises that trade can play an important part in reducing poverty and improving our quality of life. It can generate jobs and wealth.
Conservatives believe that trade could be the greatest force for poverty reduction in history. There is no question but that the opening up of markets and increased trade from developing countries would dwarf any contribution that could be made from overseas aid. That is not idealism, but common sense.
Tariff barriers cost poor countries $100 billion a year—twice as much as they receive in aid. We firmly believe that trade restrictions are the main barrier to development. There is a danger that seeking to impose controls on overseas investment in developing countries may make it less attractive for companies to invest, which would deprive people in the developing world of the jobs and trading opportunities that they desperately need.
Much progress has been made in reducing poverty over the past 50 years, but it has been patchy. A whole continent—Africa—is being left behind. It is the only region in the world that is completely off target when it comes to meeting the millennium development goals on health, education and poverty.
That is why we have called for the debate today. Despite the onward spread of globalisation, the World Bank has found that many of the poorest countries are in danger of becoming marginal to the world economy. As it pointed out in a recent report, incomes in those countries have been falling, poverty has been rising, and those countries participate in trade less today than they did 20 years ago.
This is our challenge: the Government and the whole international community must do more to allow countries currently excluded from international trade to reap the immense benefits that it offers.
Much pressure has been placed on poor countries to open their markets and liberalise trade, but rich countries—including Britain—are reluctant to practise what they preach. Telling poor countries to end subsidies and open their markets is like sitting in a glasshouse throwing stones, and today we want to address such hypocrisy.
We can alleviate world poverty by freeing up trade, and I want to set out how it can be done. First, it can be done by market access. If Africa were to increase its share of world exports by just 1 per cent., it would generate $70 billion—approximately five times what the continent receives in aid. Conservatives believe that free trade is the engine of poverty reduction. Several case studies show the beneficial effects of increased global trade. The number of rural poor in China declined from 250 million in 1978 to just 34 million in 1999. The level of absolute poverty in Vietnam has been halved in 10 years. India and Uganda have also enjoyed rapid poverty reduction as they have integrated into the world economy. Poverty in Uganda fell by 40 per cent. in the 1990s, and school enrolment doubled. More has been done to address poverty in the past 50 years than in the past 500, but there is much more to do.
Will the hon. Lady explain the Conservative position on the Tobin tax, which would raise trillions of pounds a year on international currency speculation? The Chancellor of the Exchequer blows hot and cold about the measure, and is in a cold phase at the moment. It would be nice to know where the Conservatives stood on the matter.
I thank the hon. Gentleman for his intervention, but I do not think that one measure will fix the problems of global poverty. The underlying problem that the measure seeks to address is currency instability, to which many factors contribute. That is the key point.
How does globalisation work to reduce poverty? It increases inward investment and drives economic growth. It has meant that, for the first time, poor countries have been able to harness the potential of their abundant labour to break into global markets for manufactured goods and services. In fact, manufactured goods amounted to less than a quarter of developing countries' exports in 1980, but by 1998 they had soared to 80 per cent.
Poor countries' comparative advantages can be realised when they are able to export freely without unnecessary hindrance. For many people—indeed, for an entire continent—the picture seems less rosy. Many billions of people remain excluded from the process of globalisation, for which a number of factors are responsible, including conflict, sickness and poor government. However, many of them are excluded from trade by the prevailing trade systems. As Kofi Annan pointed out last year, poor countries are caught in a vicious circle—they need foreign investment but can offer little to attract it. In order to break out of that cycle, poor countries need to export and to open markets in which their goods can compete.
Here is the authentic voice of business. The chairman of Unilever wrote in the Financial Times last week:
"For all their talk of development, western nations in effect exclude many African exports from their markets."
That is from the chairman of a company that has been in Africa for more than a century.
Rich countries continue to impose barriers to trade on their poor neighbours. The most obvious are the punitive tariffs imposed on imported goods. Possibly the most well-known example is the recent decision by the United States to raise tariffs against steel imports, but the USA is not the only culprit. According to an Oxfam report published on
The least developed countries lose an estimated $2.5 billion a year in potential export earnings as a result of high levels of tariff protection in Canada, the EU, the United States and Japan. Without tariffs and quotas, poor countries could generate an 11 per cent. increase in their exports.
Does the hon. Lady welcome the European Union's everything but arms initiative, which removes tariffs from everything but arms for the poorest countries? Does she think that that is at least a move in the right direction and will she explain why it did not happen while the Conservative party was in power?
I will discuss in some detail what the European Union has done to help and where it could do more. When the Conservative party was in power that initiative had not been proposed, but there is no doubt that it represents progress and I shall say so.
It is difficult to quantify the benefits that would accrue to developing countries if there were total import liberalisation. Some estimates have predicted gains of more than $3 billion each for India, China and Brazil and more than $14 billion for Latin America in total. The Government have pledged a number of times to reduce the import tariffs that face poor countries. Progress has been made. The initiative to which Hugh Bayley referred made a start in providing that free access to poorer countries, but the EU still maintains some of its highest tariff peaks on a large number of imported goods. Canada is another example, as 30 per cent. of poor countries' exports to Canada face peak tariffs.
On a slightly different note, another injustice is that typical exports from developing countries, such as agricultural and labour-intensive products, face far higher tariff barriers when they enter major northern markets than industrial products.
The Prime Minister announced in his speech to the Labour party conference that we would offer Africa access to our markets, to practise the free trade that we are so fond of preaching. Are we extending free access to Africa? Perhaps the Secretary of State will clarify how market access is to be extended to Africa. What are the tangible steps to better market access? Which countries do we want to help? What objectives have we set and how will we measure success?
At the EU Heads of Government meeting—
If the hon. Gentleman will forgive me, he has questioned me on a subject about which I know quite a lot as I worked for sugar beet growers for more than 15 years. I wish to give him an informed reply and not a simple yes or no. It is not a simple question. Perhaps he is not aware that, under the protocol signed by African, Caribbean and Pacific countries, many developing countries benefit from the same price as that received by farmers in this country. Automatically removing those preferential terms would create very real problems in the sugar industry of those countries. While I am sure that reform is needed in that area, we must be very careful that it does not hurt our farmers—we must find reforms that will work for them—or have damaging consequences for the most vulnerable farmers.
Everyone is in favour of free and fair trade until it comes to specifics. The hon. Lady has worked in sugar and sugar beet, where there are quotas that privilege certain of the poorest countries. The sugar beet farmers of the United Kingdom and farmers in some of those countries ran a campaign to weaken the everything but arms initiative and access for sugar from the least developed countries, and they succeeded to a degree. The hon. Lady is telling us that we should open our markets to the poorest countries, but she wants a position for the sector in which she has worked that is not as good as the one that she proposes overall. The Government's position was that we should have opened the markets fully to the least developed countries. The compromise was reached because, with the help of many Tory Members, who lobbied—
It should be remembered, Mr. Speaker, that 50 per cent. of the UK market for sugar is supplied from developing countries, which is unique among the member states of the EU. The Government have a lot of work to do with other EU member states that do not have such an accepting compromise with the developing world and do not allow free trade both from and to such countries.
I want to proceed on this point. We have had an exchange on sugar, and I do not wish to be accused of allowing the issue to dominate the debate. This is a short debate, a number of Members want to contribute, and I am sure that the hon. Gentleman will be successful later in catching Mr. Speaker's eye.
At the EU Heads of Government meeting in Seville later this week, the Prime Minister should promote the agenda of furthering free market access for poor countries. Could he make public the list of EU negotiating demands on the general agreement on trade in services, which have to be decided before the end of this month? Hon. Members have a real interest in that. Promoting genuinely free trade should also be high on the agenda in Canada later this month, when G8 countries meet. They have the greatest influence in changing trade rules. At the moment, the World Trade Organisation seems remarkably impotent at tackling human ingenuity in avoiding rules that are designed to free up trade. Reform is needed of the WTO so that it is even more effective. We could do more to tackle the scepticism among developing nations, however, as the WTO does not appear to serve them well.
Here is a practical suggestion for the Secretary of State—could we not provide a panel of lawyers and advisers to help developing nations make the rules of the WTO work better for them?
The hon. Lady is making the case for free trade as a motor for development, on which we can agree. Does she repudiate the experience of the previous Conservative Government, however, in tying trade to aid? That left a situation in which developing countries, far from being free to trade, were forced to import goods and services, and, often, arms from this country, which they did not want and did not need.
I am not here to repudiate and analyse history. The important thing is that we gave our support to the International Development Bill—now the International Development Act 2002—which untied aid. As part of that, we recognised the important focus of poverty reduction. I hope that, in everything I have said today, I have made it perfectly clear how committed the Conservative party is to reducing global poverty. I hope that the hon. Gentleman is left in no doubt about that.
On the wider issue of trade barriers, will the hon. Lady first tell us for the record whether the Conservative party is in favour of majority voting in the WTO? Secondly, is it in favour of majority voting in the European Union? One of the reasons that subsidy and trade barriers in agriculture have continued is that the veto in the European Union has kept them in place.
The hon. Gentleman may know that I spent a great deal of time working with different member states of the European Union on agricultural policy. I discovered that it is very difficult to make headway in negotiations when member states lack the good will to work together for the best result internationally, for Europe as a trading bloc, and, as I hope that I have made clear today, for poorer nations. All too easily, national interest can be over-used. I have seen it used and abused. There are times, however, when the national interest is an issue and when Governments would be expected to argue for the national interest of their country. In the past, the trouble has been that it has been used injudiciously, not by our country specifically, but by a number of other countries that have strong vested agricultural interests. That has led to the use of the national interest to defend a country's position being brought into disrepute. I am therefore wary of making a sweeping generalisation about whether it should or should not be used.
I want to move on to reform of the subsidies, which is a very important area. It is another matter that the Prime Minister should discuss in Seville later this week. Some of the worst distortions of trade are caused by the subsidy systems used by countries to bolster their domestic production. When it comes to subsidy, there is no way in which poor countries are able to compete with the power of wealthier nations.
In dollar terms, agricultural subsidies in countries in the Organisation for Economic Co-operation and Development are more than two thirds of Africa's total GDP. They account for more than a quarter of farm output in the United States, rising to 40 per cent. in the European Union and to more than 60 per cent. in Japan.
The Trade Justice Movement has provided us today with the example of rice growers in Haiti, who produce rice for local markets. However, as rich countries, notably the US, have subsidised their rice exports, Haiti has been flooded with cheap rice imports so that Haitian farmers are unable to find a market for their crops.
I have worked in agriculture for most of my working life, and I deeply sympathise with the problems that our farmers—particularly dairy farmers—face. The irony is that the common agricultural policy is meant to provide a reasonable standard of living for farmers in the EU, but it does not even provide a living wage for our dairy farmers and directly affects the viability of farmers in the developing world.
Recently, I went to India with Oxfam and Members may not be aware that India is the world's largest producer of milk. However, it cannot compete with subsidised milk surpluses from the EU that are exported to the growth market of the middle east. That is despite the fact that India is the second lowest cost producer in the world after New Zealand.
At the last ministerial meeting of the WTO in Doha, countries agreed to launch a new trade round, including the liberalisation of agricultural subsidies. That was certainly progress, and I hope that it comes to fruition. Nevertheless, the decision came after much foot dragging by the EU, and the scepticism of poor countries results from rich countries' reluctance to keep their side of the bargain in the past.
I am sure that the whole House abhors the decision by the US Congress to vote through an additional $100 million worth of subsidies for American farmers. Total US agricultural subsidies will then amount to $388 dollars per head, which represents a staggering 67 per cent. increase in farm subsidies. However, we should not kid ourselves that those sums get through to poor farmers.
Americans may be our staunchest allies in time of war but, on trade, that increase is a retrograde step for the principles of liberty that their nation espouses. The move will cause incalculable damage to the lives of farmers in the developing world as well as to the livelihoods of farmers in this country. I clearly recall the outrage that resulted from the US decision to impose tariffs on its steel imports, but have the Government expressed similar condemnation of the US Farm Bill? When the Prime Minister goes to Canada for the G8 summit, I hope that he will use his good relations with the US President to make plain the damage that the Bill will do.
The US is not the only culprit. EU agricultural subsidies amount to $276 a head—to use the same currency—compared with $338 in the US. The last thing that we want is the equivalent of an arms race in farm subsidies. To prevent that, the CAP must be reformed. Some 1.6 million Africans live on less than $2 a day but every cow in the EU is subsidised to the tune of $2 a day.
I have already given way to the hon. Gentleman.
The Government White Paper on globalisation pledged to push for significant reform of the CAP, but that has not happened. The CAP must be reformed in a way that will ensure a reasonable living for British farmers and reasonable opportunities for their counterparts in poorer nations. Farmers in Britain face huge problems and they are not well served by the CAP. Conservative Members would like the Government to make a far greater effort to reform the CAP. In their White Paper, they said that they would use every opportunity to work for change to the CAP. When the Prime Minister attends the EU summit later this week, will he try to persuade other EU leaders to agree to a timetable for CAP reform?
There also needs to be reform of double standards. Rules that appear to benefit only the rich at the expense of the poor should not be tolerated. Those groups that accuse the developed world of double standards are right. I recognise that people may think that trade liberalisation is a one-way street for richer countries to get richer, but it does not have to be. I see it far more as a two-way street, with trade going both ways. The Government should tackle trade injustice with more vigour. We are calling on them to show leadership. If any poor nation behaved in the way that America recently did in passing its Farm Bill, it would have faced the wrath of the World Bank and the International Monetary Fund. It is one rule for some and another rule for others.
Later this month, the G8 will meet in Alberta, Canada. There has been much rhetoric about it being a development summit. The New Partnership for Africa's Development is high on its agenda. NEPAD is a partnership, and on our side that should mean free and fair market access. Partnership is a two-way process, however. In return for opening our markets, we can press for economic, political and social reform in those countries that want to trade with us. There is no doubt that corruption is one of the greatest impediments to development in such countries. One of the most important things that could be achieved in the summit would be a commitment from the G8 to address the imbalances in the trade system.
Some 10,000 people have come to lobby Parliament today on the issue of trade. There can be no doubt that increasing levels of global trade offer hope to millions of people living in poverty. The Secretary of State has strongly defended globalisation in the face of its critics, some of whom are on Labour's Back Benches. The Government's White Paper on globalisation is called "Eliminating World Poverty: Making Globalisation Work for the Poor", but billions of people are still marginalised by the process. The challenge now is to make globalisation work on a global scale.
I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:
"welcomes the lobby of Parliament by the Trade Justice Movement and increased recognition of trade as a key component to reducing global poverty;
welcomes also efforts made to draw public attention to these important issues;
recognises trade has an important role to play in helping countries achieve the Millennium Development Goals (MDGs);
is aware that to achieve this a multilateral trading system is needed giving developing countries a fair deal;
recognises that the Government is committed to working with developing country partners, and other bilateral donors and multilateral organisations to achieve this;
believes that the development challenges faced in Africa require the international community, working together with African countries, to make additional efforts to secure progress towards the MDGs;
welcomes the Government's commitment to turning the agreement reached at Doha in November last year into a meaningful 'Development Round' and to achieving real progress on market access and in areas of importance to developing countries;
will continue to support efforts to reform the Common Agricultural Policy and reduce trade-distorting subsidies;
will support preferential access to developing countries through the Generalised System of Preferences aid to least developed countries through the Everything But Arms initiative;
recognises developing countries themselves must undertake effective policy measures to integrate into the global trading system;
supports these efforts and engagement in a broad range of activities to help countries participate more effectively in the multilateral trading system;
and further welcomes the Government's commitment to doubling support for trade-related capacity building from £15 million in 1998–2001 to £30 million in 2001–04.".
This is a happy day for me. It marks a real shift in the development movement in the United Kingdom and, indeed, in the position of Her Majesty's official Opposition. Different groups have come to understand that more equitable trade rules are essential to create the opportunity for the poorest countries to grow their economies and for the poor of the world to work their way out of poverty. It is important to have such a strong new consensus across the development movement in the UK and across the Floor of the House. That is a significant change and it enables us to try to use our influence on the world stage to bring about the policy for which we all jointly argue.
My Department and I have been working to get the development lobby to take on the case for more equitable trade rules since the Department was established in 1997. Importantly, its powers were enlarged beyond being an organiser of the UK aid budget to include an analytical role in trade, agricultural reform, fisheries, environmental agreements, debt, conflict, humanitarianism and so on. The objective was not just to run a good UK aid budget that was as large as possible, but to get the rules of the international system more equitable so that the planet could be run in a more equitable and sustainable way for all.
I should like to pay tribute to the quality of officials in the Department. It is respected as one of the most high-quality development organisations in the world in both its delivery and its analytical capacity. It is staffed by highly motivated high-quality officials. My first permanent secretary, Sir John Vereker, is no longer with us, but he made an enormous contribution to establishing the new strengthened Department. The UK should be proud of the quality of the people who lead development work for us across the world.
The new Department was established in 1997 with the remit to consider trade and development. Our first hurdle was posed by the Department of Trade and Industry. The official, now retired, who led on trade in that large Department was struck with apoplexy at the thought that the Department with responsibility for development dared to have views about trade. There was an enormous battle between the trade part of the DTI and my Department. Up to then, the DTI had been asked to promote only UK trade interests, and suddenly we were changing the grounds for discussion by saying that it was in the UK's interest to have an equitable set of international trade rules that allow the poorest countries to grow their economies.
That change has taken place. There was a lot of joint work and a lot of research, and by the time we got to Doha, DTI representatives—Ministers and officials—were more progressive than trade representatives from most other OECD countries because they saw more equitable global rules as being in everybody's interests. Today we are celebrating a long journey, and the first part of it involved legitimising the DTI's concern with the global management of trade rather than the simple duty to promote UK trade interests, regardless of the interests of others.
From there we moved forward to Seattle. Everyone will remember that almost every lobby and force, including the whole British NGO development movement, was opposed to a new trade round at Seattle. Many voices called for the WTO to be closed down. We had a debate in the House of Commons—I see Mr. Curry nodding—in which a few of us argued that the WTO is a useful organisation that gives us a chance to strengthen global trade rules and make them more equitable.
The Clinton Administration, particularly President Clinton himself, the entire international trade union movement, led most strongly by the US but including Britain, the whole British development lobby and all the British environment NGOs were completely opposed to a new trade round. They believed that the WTO was a reactionary organisation that wanted to add to trade rules and conditions on labour and environmental standards, making it impossible for developing countries, which of course want to raise those standards, to meet the rules and have access to global markets. At that time, the trade spokesman for Her Majesty's Opposition did not mention, in explaining the party's position, the interests of developing countries.
Let us remember where we have got to. Today, with the movement of Churches and development NGOs, there has been an important shift forward. The last time there was trade competition in the world and countries were erecting barriers against each other, as we see with steel and with the US Farm Bill, was in the 1930s, when there was depression in some parts of the world. Country after country imposed tariffs, which threw the entire world economy into the most terrible depression. That led to the second world war and to fascism and all that flowed from that.
Following the second world war, we started off with the general agreement on tariffs and trade. I believe that the first trade round after the war was called the Torquay round, which is rather sweet. Not as many countries were members of GATT, and the negotiators were blocs of rich countries. There were rounds of trade talks to try to reduce the tariffs that remained from the 1930s. That was a worthy process, and it was better than what it took over from, but following the Uruguay round, the WTO was born. It is only five or six years old, and it really was an advance.
The WTO is an organisation which countries join by choice, and which is based on rules that apply equally to all. It negotiates by consensus. I do not think that any hon. Member will agree with the proposal made by Simon Hughes that the WTO should make decisions by majority. These matters so deeply affect the interests of individual countries that we have to move forward by consensus. It is remarkable that, in negotiating multilateral agreements on the environment and trade at Doha and elsewhere, we manage to reach global consensus.
In my view, and I think that this position is now more widely recognised, the shift to the WTO gave us a chance to get more equitable trade rules. Now, the majority of WTO members are developing countries, and if they come together in a trade round and work together, they will make gains. It is possible now to have a set of global rules that are fair and that give developing countries the chance to grow their economies.
To be honest, I read the headline, not the whole article, but it appeared to suggest that because of the moves on steel and the US Farm Bill, there was a real danger that the Doha development agenda, which is an agenda for a trade round, would not be taken forward and we would not get a trade round, and that would grossly weaken the WTO. I agree that taking the WTO as an institution for granted would be a grave mistake. If the Doha agenda is not taken forward, the WTO will start to break up and lose its authority, which depends on consensus in the international system. We could easily end up with the rich countries making regional and bilateral trade agreements and the poorest countries being squeezed out of the rule making on international trade. If that danger were realised, it would be a terrible loss for the world and for developing countries.
I agree. It gives one pause for thought to consider that whereas in national politics we have the conflictive style of politics that we all know and love, on crucial matters such as multilateral environment agreements and world trade agreements, all the world's countries are represented in a set of negotiations and manage to reach agreement by consensus. That is the only way to enforce such agreements—there is no world army that can make any country that gets out of line get back into line. Only through consensus and everyone understanding that it is in the world's interests that we all play by the rules and accept fair ways of decision making can we equitably manage the current phase of human history. I strongly agree with the right hon. Gentleman.
There is no doubt that in the run-up to Seattle there was a general view among developing countries that they had achieved less by the Uruguay round than had been promised, and there was resistance to a new trade round as a result. That was understandable: many of the agreements made during the Uruguay round were more difficult to implement than countries had understood when they made them. The rules of world trade are now enormously complicated, and they are difficult for all countries to implement and individual Ministers to grasp and negotiate. The agenda is now extremely complex and extended in scope.
The argument that we advanced prior to Seattle—I made a speech to this effect in early 1999 at the UN conference on trade and development—was that if world trade rules were unfair to developing countries, the only way to make them fairer was to have another trade round. My mother would have said that we would be cutting off our nose to spite our face if we said that we would not have another trade round because the rules were unfair. A lot of work went into building momentum so that developing countries, rather than feeling hurt and aggrieved by the consequences of the Uruguay round, would agree that another trade round was in their interests. The South African Government have played an important role in building an international coalition of developing countries. They started their efforts in the run-up to the Seattle conference and continued that work on the way to Doha.
To help developing countries to advance their interests, my Department announced—in 1998, I think, during a prime ministerial speech at the WTO in Geneva—a big increase in UK funding on trade capacity building. That is not a large part of development aid spending, but it is important technical work that enables countries to consider economic strategies—to see in which sectors they have a comparative advantage that will enable them to expand their economy and take up trading opportunities, giving them the capacity to enter the international system and negotiate to advance those trade interests. We have done a great deal of work in that area. It helped many developing countries to build the confidence to advance their interests at Doha and demand the sort of development agenda that was agreed there.
We also worked hard—this is an interesting story, which answers one of the questions from Mrs. Spelman—to build a legal advisory centre in the WTO to provide advice from trade lawyers to the poorest countries free and to low income countries extremely cheaply—a law centre to enable low income countries to exercise their rights under the rules of the World Trade Organisation. When we tried to promote the proposal early on, we met massive resistance, first within our own Government, which we overcame in the ways that I described earlier. [Interruption.] It is all part of a process to get everyone to globalise their minds and look for a way of running the world that takes account of everybody's interests. It is a movement that is taking place in political analysis across the world, rather more rapidly in some places than in others.
Then we encountered resistance in Brussels, where we were told that we could not give countries money so that they could get advice, which might mean that they would take action against an EC country under the WTO. I said, "We give legal aid to murderers." There was a ferocious battle. It was interesting to see the two mindsets on trade. Do we want a rules-based, fair system under which everyone can apply the rules and has rights? Trade lawyers cost a fortune. Anyone who thinks lawyers are expensive should look at the bills of trade lawyers. Poor countries would be unable to exercise their legal rights without some support.
The resistance to setting up a legal advisory centre was an interesting example of the way in which people regard trade as their vested interest against someone else's vested interest, as opposed to our joint interest in growing the global economy and giving the poorest countries the chance to grow their economies, which is not against our interest. It is in our interest. If the poor of the world had the capacity to consume more, the people employed in industry and manufacturing in this country would have opportunities to produce and export, which would be beneficial to them and everyone else.
As usual, the Secretary of State is being honest and open with the House. Will she tell us which countries caused the most trouble? [Interruption.]
That would be very honest. The hon. Gentleman knows, as I do, that it is incredible that the world reaches agreement by consensus in the global negotiations that are more and more important to us. The "globaphobes" attack all those intergovernmental meetings and say that there is no proper democratic accountability, but the proper accountability is to each democratic Government's Parliament and civil society. We each send our representatives to global meetings to reach agreement and there are many difficulties on the way, but we frequently make progress. That is remarkable.
We are at a turning point in history. I am not in favour of globalisation, and I am not against globalisation. Globalisation is history, and it is stupid of anyone to be for or against it. It parallels what the industrial revolution meant for Europe—an opportunity to spread technology, trade, economic growth and investment across the world. The question is how we are to manage it and who will benefit. Will everyone be included or are some countries to be marginalised? It is one of the leading tasks of politics to bring about a more just world and a more sustainable and stable world for future generations.
The first big, violent outing of the anti-globalisation protesters was Seattle, where they called on everyone to oppose trade and claimed that poor countries cannot afford to open their markets and do not want to be exploited by multinational capital. They said that the WTO is dominated by multinational capital trying to impose its rules on the poor of the world. That was the rhetoric. There were massive demonstrations, with many legitimate groups on the streets, as well as the groups that went around smashing up windows in Seattle.
I believe that after Seattle, if one had gone down most high streets and spoken to decent, caring people, most of them would have said that the WTO is an evil organisation that is trying to exploit the poor of the world. It is a danger of these times if the anti-globalisers are seen to be the ones who care about the poor. They advocate policies that will harm and divide the world and harm the interests of developing countries. That is why our own dear development NGOs' move to calling for equitable trade, instead of opposition to developing countries opening their markets to trade or having the opportunities to attract foreign direct investment, is a very important change. It puts the UK in a strong position to advocate for a more just, equitable and sustainable world.
I pay a tribute to the spokesperson for the Liberal Democrats on trade and industry. He has written a pamphlet or small book on globalisation. At the time of the Seattle talks, he was speaking strongly—the right hon. Member for Skipton and Ripon was another, but there were not many others—in the spirit that I am putting before the House, which I think now has cross-party consensus. This is an important day and the unity in the country is important. The shift of development organisations is important.
I shall say a word on behalf of Mike Moore, the retiring director general of the World Trade Organisation. One of the reasons for the Seattle talks going wrong was the delay in agreeing who should take over that post—whether it should be Mr. Supachai or Mike Moore. After a long delay, during which we should have been preparing for the Seattle talks, there was an agreement that they should divide the job, I think for three years each.
The two men have worked well together. Mike Moore worked extremely hard to get us to Doha and to the Doha development agenda. In the past few days I read a savage attack on Mike Moore in a newspaper. It came from Kevin Watkins, of all people, from Oxfam, who is usually a reasonable person. He suggested that Mike Moore had no concern for developing countries. That is completely false, untrue and unfair. Mike Moore worked hard to enable the world to reach a consensus. I pay tribute to him and to the incoming Mr. Supachai. They have worked well together and they will take the world forward.
I am optimistic because it is possible to take on complex issues when we do not have agreement in our own countries. It is necessary to arrive at global agreement if we are to take the world forward. In a relatively short period we can see a big shift in public opinion. If these moves can be made, we can take ourselves forward into an era of better management of the global economy.
After Seattle, we were working with the World Bank to ensure that the bank took more interest in trade and the need for developing countries to make advances in trade access to improve their economic position. There was slowness and reluctance, but since then the World Bank has undertaken more work and produced the statistics that are quoted about how trade opening and trade liberalisation would be much more beneficial to developing countries than increases in overseas development assistance, although we need that to create institutions in developing countries that will enable those countries to run their economies and public services properly, and then to take advantage of trading opportunities and the opportunity to move their economies forward.
The considerable task that remains is to move the world forward into implementation of the agenda that was agreed at Doha. On the way to the world summit on sustainable development, which will take place at the end of August into the beginning of September at Johannesburg—that is 10 years on from the Rio UN conference on the environment—a preparatory meeting took place recently in Bali. It was the cause of great derision. Happily I did not go to Bali, so I do not have to be criticised. I have been there under my own steam, having paid for myself. The meeting went sour, but that did not mean that it was a disaster. It went sour largely because the G77, having seen the action on steel tariffs and the US Farm Bill, is ceasing to believe that the world meant what it said at Doha and then at Monterrey about finance for development.
We have been building up a fantastic consensus throughout the world, from the millennium development goals to the UN millennium assembly. At Doha, there was a round of talks to make trade rules fairer. At Monterrey, finance was discussed, and what would be a sensible reform agenda for a proper balance between the public sector and the role of markets. There was a commitment to a reversal in the decline in development assistance that is available to the world.
We want to go on to Johannesburg to integrate the environment in the analysis and to overcome hostility between OECD countries, environmentalists and developing countries. Instead of environmentalists saying, "We don't want development", we want them to say, "We want sustainable development, and we must guarantee development to the poor in a way that is sustainable for the world." That is the only way that we will keep the world united.
Our commitment to implement what was agreed at Doha is absolutely crucial if we are to keep the sort of consensus that we have been building to drive forward progress towards a more just world. That will not be easy. As I am sure that hon. Members know, it was very difficult for France to agree to the commitments made at Doha on reduction of subsidies and reform in the agricultural sector. It held out until the end, and that was the most difficult part of the agreement. Changes have taken place in the US and some of our European Union colleagues have difficulties with holding to what was agreed at Doha.
We now have a fantastic consensus in this country, but we need to appeal to all our parties in all our networks throughout the world and to all the NGOs and faith organisations that are mobilised so impressively here today. We need to ask them to reach out to their networks in Europe and especially in the United States. Through the Church networks in particular, they need to say to the United States, the biggest economy in the world, "Please don't think that you can run the world without multilateral rules." To achieve a just and sustainable world, we need the US to work with other countries to give everyone the chance to grow their economies.
There is a lot left to do, but this is a very important moment for the UK to have built the sort of agreement that we have got. It now suits our country very well for us to go out to bat on the world stage for more just rules for trade and in other areas, in order to make the world safer and more sustainable and decent.
I thank the official Opposition for securing this debate. This is a very good day on which to have it; I am only sad that they could not negotiate the 7 o'clock slot, because many hon. Members are outside enjoying the Mexican wave and the trishaws that I was lucky enough to enjoy yesterday. They are out there meeting their constituents, so it would have been much better to have had the debate afterwards so that they could have participated.
Today's lobby is one of the biggest ever; it is estimated that 10,000 people are out there in the sunshine. The Jubilee 2000 campaign was successful because it was a broad coalition that attracted all-party support. Likewise, I know that the Trade Justice Movement is a fantastic coalition of more than 40 non-governmental organisations that is attracting all-party support. The Liberal Democrats will certainly support the motion and also the Government amendment. Hon. Members can make of that what they like, but that is what we will do, as we do not want any division on these issues.
I have received hundreds of postcards from my constituents and thousands more have flowed in to all MPs during the past few weeks. An all-party early-day motion on this subject has been tabled today and I hope that all hon. Members will sign it. We know that the European heads of state are meeting very soon this month, the G8 summit is at the end of June, the world summit on sustainable development will take place in Johannesburg in September and the world trade talks are continuing all the time. This is a vital time for developing countries.
We all know that many factors affect developing countries. We have rehearsed them many times in the Chamber. They include civil war and conflict, the arms trade, lack of education, health care, AIDS, HIV, lack of clean water, environmental disasters—to which our greedy consumption in the west often contributes—a lack of decent Governments, and corruption. The list goes on. We distribute aid, but not nearly enough. The proportional increase in the aid given to developing countries is very welcome, but the amount is not yet nearly enough. To introduce a dissenting note, I am still very disappointed that the Conservatives seem to have abandoned the 0.7 per cent. of gross national product target on aid for developing countries. That is very sad and I hope that they review the matter in due course.
Wherever I go in the developing world, I hear the same message: "Your aid is welcome, but if only you would let us have free and fair trade"—I emphasise the word "fair"—"we would develop more quickly."
Throughout the 19th century, we exploited our colonies, using them for labour, raw materials and things that could make our lives better. The rich countries continue to exploit them through unfair trade agreements. The European Union and the USA in particular have a duty to lift the developing world out of poverty. The connections between
A 1 per cent. increase in trade for African countries would generate $70 billion or five times what Africa receives in aid. Import tariffs cost developing countries $100 billion, which is twice as much as they receive in aid. What nonsense—we give with one hand and we take away with the other. Last July, in Zanzibar, prior to the World Trade Organisation meeting in Doha, developing countries called on the rich countries to abolish subsidies for their products and open their markets, but there has been little progress on that. The Uruguay round, which the Secretary of State mentioned, was good news at the time because it committed developing countries and rich countries to a reduction in tariffs and subsidies. With the general agreement on trade in services—GATS—it got the developing countries to open up their services to private companies.
To a large extent the developing countries have done so. But did the rich countries keep their side of the bargain? Did they heck. One problem is that tariffs and subsidies remain, and GATS is still a subject of great contention. However, I do not agree that services such as supplying water must always be controlled by the public sector. I recently visited Ghana to look at its Government's proposal to privatise the water supply in Accra. The public sector there is certainly not delivering clean water to the people of the city. The situation is appalling, because 52 per cent.—a rather optimistic estimate—of the water supply is lost or goes to cowboys who sell it to the poor at extortionate prices. The argument that a multinational company may make water even more expensive for the poor does not wash, if that is the right word. I think that it could be cheaper under a privatised system.
I have had a briefing on this. GATS is a bottom-up agreement—countries open up services as they wish, and there is no requirement to privatise education and health care. Privatisation is the only way to get the investment that those countries need in things like banking, tourism, telecommunications and services such as water under good regulatory arrangements. I agree that the campaign saying that there should not be a voluntary scheme to open up services in that way is misguided.
I thank the Secretary of State for her contribution. The key to privatising Accra's water supply is the regulatory service. I admit that I was worried about that, and the Ghanaians will need assistance in regulating services to provide water.
The common agricultural policy is a bone of contention. It is another gross violation of international justice. The European Union spends $41 billion on agricultural subsidies. Rich farmers in rich countries continue to be subsidised and to flood developing countries with their produce, forcing their poor farmers out of business. I hope that we shall get some good news on that front in due course, because it is time that the common agricultural policy was looked at.
As the Secretary of State told us, the European Union introduced the everything but arms initiative to give at least 49 of the least developed countries tariff-free and quota-free access to our markets. However, it quickly became the everything but arms, rice, sugar and bananas initiative, thus re-erecting barriers to some of the main exports from developing countries. Before Conservative Members get too self-righteous and pleased with themselves about their newly discovered philanthropy, I remind hon. Members that it was lobbying by many Conservative Members on behalf of the sugar beet industry that led to sugar being excluded from the EU initiative. We shall not forget that, and it is worth remembering. They cannot preach free trade and call for trade liberalisation, as they are doing today, while lobbying to protect our own domestic interests.
Why does that remind me of the United States? In May, the US, having acknowledged that poverty indirectly leads to terrorism, passed a Farm Bill that will increase subsidies to American farmers by 70 per cent. over the next 10 years. As I discovered on my recent visit to Ghana, northern Ghana used to produce lots of rice, which was eaten by people all over Ghana. Urban Ghanaians now eat American polished white rice, which is ludicrous. Their farmers have no markets at home or abroad and are in poverty. In 1998, 68 per cent. of Ghana's labour force was in agriculture. What are they to do in the short and medium term to fill that gap? It is a mad, mad situation.
Does my hon. Friend agree that protectionist elements in Europe give the American Administration an excuse for introducing their Farm Bill? This morning, I had a conversation with an American Congressman who was here in the House, and he said that the protectionism adopted by several European states through the CAP provides an alibi for the Farm Bill. That is a problem.
I agree. I do not exclude Europe from blame. Both the European Union and the US have to search their souls on this issue. If we mean what we say about opening up our markets and bringing developing countries into the real world to share in its prosperity, we have to give a little on our side. That cannot be done if we continually protect our own interests. I accept the argument advanced by Mrs. Spelman in so far as sugar beet farmers would have a tough time if their market fell, but could we not consider other things that they could grow? The biofuels industry represents one possibility.
I hope that the hon. Lady tried to disabuse the American Congressman by pointing out that when the United States introduced its Freedom to Farm Bill, which liberalised the American system, the CAP was a great deal more protectionist than it is now, and that the Farm Bill has been introduced at a time when the CAP is being liberalised rather more than many people think.
That point has already been made, and I want to move on. However, I emphasise that we must all recognise that something has to give if developing countries are to be relieved of their poverty.
I shall not have time to deal with many other aspects of world trade and its effect on developing countries, such as joined-up government. This morning, my hon. Friend Norman Lamb noted that there is no point in the Department for International Development having wonderful policies based on sustainable development when there are shenanigans such as those between the Department of Trade and Industry, the Ministry of Defence, Barclays bank and British Aerospace on the air traffic control system for Tanzania. We must tackle that aspect of trade and ensure that all Departments tackle the core theme of sustainable development. We cannot relieve Tanzania of debt only to plunge it immediately in £28 million more debt by selling it an inappropriate system that will benefit our industry but not Tanzania.
I shall not go into the trade-related aspects of intellectual property rights, because I confess that I do not understand the ramifications of the TRIPs agreement. The arguments about the problems have been well rehearsed. Many Liberal Democrats worry that the part privatisation of the Commonwealth Development Corporation has caused it to take its eye off the ball in the interests of attracting shareholders. Agriculture, especially agribusiness, in the poorest countries has consequently suffered.
The activities of the multinational companies require a debate. Such companies probably constitute one of the greatest forces for good or evil in the world. Huge companies that wield massive power and also make much needed investment in developing countries to improve their trade are part of globalisation. However, we need to ensure that they behave decently and sensibly, and stick to Organisation for Economic Co-operation and Development guidelines wherever they operate.
I want to speak about an important factor that the Secretary of State mentioned. Developing countries must be helped to participate more effectively in the World Trade Organisation and the WTO must commit itself with the rest of the world to the international development targets. I understand that only 30 of the poorest countries are members of the WTO. All developing countries face major difficulties representing themselves there. They do not have the capacity or expertise, and I welcome the initiatives by the Secretary of State and the Department to try to build such capacity in sub-Saharan Africa and its regional organisations. I hope that when the Minister sums up, she will tell us more about the enhanced integrated framework pilot schemes, which will operate in Cambodia and Madagascar, and how those countries can represent themselves better.
In the north, we get increasingly richer by protecting our markets while forcing the poorest countries to open theirs to our trades and services, making them poorer. We have declared a war on terrorism when what we really want is a war on poverty. 4.48 pm
I shall use my nine and a half minutes wisely, Madam Deputy Speaker.
I congratulate John Whitworth and his team of supporters from York who have joined the lobby today and whom I have had the benefit of meeting. I do not say that simply as a courtesy, although I am glad to see constituents coming all the way from York to Westminster. We all need—this includes Parliament and the Government—a grass-roots campaign that backs our actions. The Secretary of State made it clear that we have to argue our corner in international institutions such as the EU and the WTO. It is important to show that a fan club exists for development and the actions of the Secretary of State and other members of the Government.
Until recently, trade policy was one of those dry-as-dust subjects that interested only a few underpaid development agency workers and a few extremely overpaid international lawyers who argued disputes at the World Trade Organisation. In recent years, however, it has become a battlefield. The Secretary of State is right to say that there has been a sea change since Seattle, which was quite literally a battlefield, but there is still conflict between pro and anti-globalisers. We must ensure that the world's poor are not crushed by those contending forces.
Trade is not a panacea, but it is true that the countries with the smallest share of world trade—a share that is still declining—are those with the largest proportion of their population living in absolute poverty. Trade can lift people out of poverty, but it will succeed in doing so only if trade growth is supported and complemented by good pro-poor development policies.
I want to emphasise three things to the House. First, trade creates wealth; it makes people richer. It increases production and, therefore, consumption; for most people living on the breadline, consumption is a measure of their disposable income and their standard of living. The World Bank showed, in its publication "Can Africa reclaim the 21st century?", that if Africa had the same proportion of world trade now that it had at the time of decolonisation in the 1960s, it would have an income of some $70 billion a year more. In other words, its income would be about 20 per cent. higher. One of the things that we need to achieve, therefore, is an increase in the volume of trade with the poorest countries.
Secondly, trade does not necessarily result in a reduction of inequality, even in the regions where the volume of trade is increasing. The benefits of trade do not necessarily trickle down to the poor. That is why we need to change the terms of trade, as hon. Members have already mentioned. That requires policy change in developed countries such as ours—most notably a change in the common agricultural policy, in the case of Europe—and in developing countries.
That also means that trade policy needs to be embedded in development policy, and needs to appear in the country strategies—for example, those being drawn up by our Government and by the World Bank—for developing countries. Trade policy needs to be mainstreamed into development policy just as the environment, gender and other matters have been in recent years.
Thirdly, I would like to remind the House that trade takes place not between countries but between companies. Trade policy must encourage investment in private companies and entrepreneurship, and must recognise the role of the private sector in international trade.
Why has Africa lost some of its share of world trade in the decades since the 1960s? As hon. Members have stated, it is in part because the rich world—the developed countries—has been far from generous in its trade relations. We have been protectionist—above all, in relation to the commodities that the poorest people in the poorest countries have some possibility of exporting to us, particularly in agriculture.
Textiles and clothing, too, as my hon. Friend rightly says.
Also, many sub-Saharan African countries have followed poor policies themselves, which helps to explain why their trade performance has been poorer than those of some other developing countries, such as those in east Asia. Our policies need to change, and their policies need to change. That is why I am so excited by the New Partnership for Africa's Development, which recognises that if we both change things, life will change for the poorest people in the poorest countries.
One of the things that the developing countries in Africa got wrong in the past was setting fixed exchange rates that overvalued their currencies. When I visited Uganda in the early 1980s, the official exchange rate was 120 Ugandan shillings to the pound, but the real market exchange rate on the street was 600 or 650. What did that mean in practice? The Ugandan elite could import Scotch whisky for a quarter of its real cost, and Ugandan farmers had to export bananas or any other agricultural products at four times their real value. It is therefore not surprising that it was difficult for the poor to export from Uganda and other such countries.
There were further problems with fixed interest rates. They were fixed by African Governments for the good reason that, in their view, setting a low interest rate made borrowing more affordable. However, borrowing is assisted only if a rate is set that encourages people to invest. Many African countries had an interest rate that was lower than the inflation rate. The resulting real-terms negative interest rates meant that no money was put into banks, or that it was put into banks in the developed world, rather than into African banks. Those economic policies need to change. Such failures reduced exports, squeezed out investment, and fuelled the growth of corruption as people tried to get round the policies enforced by their Governments.
Hon. Members have spoken eloquently about the contradiction between what we in the west preach on free trade, and our practice of agricultural protectionism. If we are to make the Doha trade round a development round, we certainly need to reduce the level of subsidy for European Union agricultural exports, and for domestic production. We need also to address the timetable for CAP reform. As I understand it, the Commission has agreed to complete the CAP negotiations by 2006, yet at Doha all WTO countries offered a commitment to complete the round by the end of 2004. If we are to make the necessary contribution to the Doha round in terms of CAP reform, we need to advance the CAP timetable.
In many ways, it was the events of
"an open, rule-based, predictable, non-discriminatory trading and financial system."
That cannot happen unless the WTO makes that its policy. Targets 7 and 8 pledge to halt the increase in incidence of HIV/AIDS and malaria, but that will not happen unless the WTO agrees to change the current rules for patent protection for the pharmaceutical industry, under the trade-related intellectual property rights agreement.
I want to make three brief points. First, considerable consensus exists in the UK on these matters, and we should build on it. Given that we all agree on the motion before us, it seems a little crazy that the rules of the House require us to divide on it. However, that is something for the usual channels to work out.
"international trade rules should work to the benefit of developing countries."
Before she went to Doha, the Secretary of State for Trade and Industry said:
"Halving protection in agriculture, industrial goods and services could boost developing country incomes by around $140 billion a year—three times the value of all aid budgets put together . . . We recognise that inequities remain in the international trade system and want to make sure that this round fully addresses the needs and concerns of developing countries . . . The next round"— that is, the Doha round—
"provides an opportunity for further opening of agricultural markets and significant reductions in the level of trade-distorting agricultural subsidies. With a majority of the poor in developing countries living in rural areas, this would make a substantial contribution to the UK's commitment to eradicate poverty."
Responding to a recent debate in Westminster Hall on fair trade, the Under-Secretary of State for Foreign and Commonwealth Affairs said:
"However, the subsidies given to farmers in the north—both in Europe and the United States—amount to more than the total combined gross domestic products of sub-Saharan Africa . . . Today, rich countries pay out $1 billion a day to their farmers in agricultural subsidies. Annually, the figure is more than four times all the development assistance that goes to poor nations."—[Hansard, Westminster Hall, 14 March 2002; Vol. 381, c. 1121–22WH.]
I do not think that there is any dispute about what the issues are, and there is agreement across the House about some of the issues that need to be addressed. However, my second point is that painstaking work will have to be done. No big headline quick fixes can be done: painstaking work will have to be done to reform the CAP and during the Doha process.
The European Commission is scheduled to produce proposals under the CAP mid-term review in late June or early July. I think that the latest date for that is
I hope that, in the process of the CAP reform and World Trade Organisation negotiations, we will be able to do some work on the development box in the WTO agreement on agriculture. Little reference has been made to that this afternoon. I suspect that a lot of work at official level is still needed to determine whether a development box on agriculture in the WTO agreement would work to protect farmers in developing countries.
When the hon. Members for Clydebank and Milngavie (Tony Worthington) and for City of York (Hugh Bayley), and my hon. Friend Mr. Robathan and I were in Ghana and Nigeria recently we were struck by the fact that, in Ghana—a country that produces huge numbers of fantastic tomatoes—all the tomatoes in the supermarkets are tinned tomatoes from Italy. That is completely crazy. When one asks people whether there is not a tomato processing plant in Ghana, they say that there used to be one but that it fell into disrepair and that no one has been prepared to invest in it.
We need to see whether more can be done within the WTO rules to protect countries like Ghana from the dumping of EU agricultural surplus. I am agnostic as to whether that should be done through a development box in the WTO agreement, but I hope that more work can be done on the matter by officials. When the Under-Secretary of State for International Development winds up the debate, I hope that she will tell us what the Government line is on the subject. It is important that we have some understanding of whether such a course of action could help and protect people.
My third point is that we need to support reformers in developing countries. We hear a lot about the bad guys, and we hear incessantly about Mugabe. It is quite right that we should, but there are also some good guys. I make no apologies, in the remaining couple of minutes, for reading a piece that I saw when several of us were in Washington the week before last to lobby members of the US Senate and Congress to do more on international development.
The piece appeared in the Washington Post, and it is worth sharing with the House. It stated:
"Media coverage of the protests against globalisation has diverted attention from what may well be a more striking and historic development: the growing consensus between African countries and their Western partners on the importance of trade in overcoming global poverty."
It is not simply a consensus in the United Kingdom, it is a consensus between us and our African partners. The article continued:
"From President Bush to the rock star Bono . . . to the leaders of the 54 African countries represented in the Organization of African Unity, there is now a broad agreement that no national or international strategy for addressing poverty can be successful unless it promotes expanded trade and investment.
For too long, Africans and their partners in the West have looked to international aid as the answer to the poverty and economic challenges confronting developing countries . . . While well- intentioned, this over-emphasis on aid has actually handicapped Africa by promoting a dependency mentality and the impression that African countries could not compete in the global economy.
By itself, aid cannot transform societies. Only trade can foster the sustained economic growth necessary for such a transformation . . . Africa does need development assistance, just as it needs debt relief from its crushing international debt burden. But aid and debt relief can only go so far . . . We Africans are no longer looking for handouts. Rather, we are asking for the opportunity to compete, to sell our goods in Western markets, to be considered for private investment funds, and to participate more fully in the global trading system. In short, we want to trade our way out of poverty".
That was written by Mr. Museveni, the president of Uganda. I thought that it was a gripping article, worth sharing with colleagues. He also said:
"we Africans must do more to put our own houses in order."
We must remember that, for every Mugabe, there are reformers in Africa, whether they be in Uganda, Ghana or South Africa, whom we should support.
Mr. Museveni has also been reported as saying:
"The biggest request we are making of Western countries is to open their markets . . . Debt relief has saved us some money, but the real money will come from trade. Give us the opportunities, and we will compete."
Today's lobby has been fantastic; it will ensure that international development and related issues stay high on the political agenda in this country and that everyone has the confidence to take them seriously. I think that the House and everyone of good will has come to a consensus on what needs to be done. We need to turn to the detailed, painstaking work that has to be done to reform the common agricultural policy and the Doha round. Much of that work will be complicated and very tetchy, as the earlier exchanges on sugar and other commodities have demonstrated. We must also give strength and support to reformers in Africa because, with their help, we can ensure that many countries can trade their way out of poverty.
I apologise to my right hon. Friend the Secretary of State for International Development and Opposition Front Benchers for not being here for the beginning of the debate. I was with my constituents, on the other side of the River Thames, listening to the concerns that they expressed with great lucidity and cogency. It is a most wonderful rally or demonstration, whatever we want to call it. However, as I said to my constituents, I wondered why they were here, preaching to the converted, and not campaigning outside certain foreign embassies in the capital.
It seems to have been a comparatively short time—certainly a decade—since the feeling in the country at large and in the Chamber has moved from the idea that we can transform poverty, eradicate disease, introduce education and actively assist countries to develop exclusively by increasing the amount of aid that we pour into the begging bowl. The posters this afternoon were entirely different from those that would have been seen 10 years ago.
Indeed. Then, they would have been about aid, while today's are about fair trade—fair being the operative word.
There are still areas about which my constituents are very concerned. I was interested in my right hon. Friend's view of globalisation, with which I concur. One cannot be for or against it, but one must acknowledge that it is here and that it is not going to go away. The question is how it is best managed in the interests of the vast number of people in the world who seem to have absolutely nothing.
Within the public perception of what the Government are doing on their own and in concert with European Governments and the wider world community, there is a view that we are not acting speedily enough or delivering enough results because we still talk about fair trade. Some believe that the best way to eradicate poverty is to keep people in a sort of village environment, where nothing to do with machinery or the crudities of the developed world will ever impinge on the tranquil and pastoral nature of their lives. I have visited some of the countries where there is a pastoral nature to people's lives. I have stood beside representatives of non-governmental organisations who, on hearing a group of people singing a traditional song, have lamented to me that it seems a shame that teaching their children to read will interfere with their culture. I am sorry, but I think that that view is crazy. To deny anyone the right to read is the antithesis of what today's demonstration outside was about and of what we have been cogently arguing for in this Chamber for a considerable time.
We talk easily about the problems of the developing world, but it seems to me that the problems are essentially of the developed world. As Dr. Tonge, who speaks for the Liberal Democrats, said, we have to begin to examine what we are prepared to give up. I will give a precise example of what I mean. One of my young constituents raised with me the privatisation of water in India and Ghana. I find it deeply offensive that someone should argue that the largest democratic society in the world—India—or any other independent nation state should be told by the developed world whether it may begin to privatise its utilities. Those concerns were not expressed to me when New Zealand privatised its water supply, or when Australia or any other country in the developed world did so.
I agree with my hon. Friend Hugh Bayley that we have to take this opportunity to make this a grass-roots, committed change on the ground.
On non-governmental organisations, Blake's poems opposing the industrial revolution in the United Kingdom are an equivalent. We still sing "Jerusalem", but it was written to oppose industrialisation and the wealth to which that led.
It is an interesting parallel.
Ghana has not privatised; it has asked a private company to manage under a regulated arrangement a more efficient system of delivery in urban areas. Christian Aid is campaigning against that democratic decision of the previous Government, supported by the Opposition, to deliver water to people who did not have it—it had to be brought to them by the bucket at great expense. That is a mistaken approach and we must resist it.
That is my final point. It is beholden on us all to make it abundantly clear to people out there, who work extremely hard for what they believe in—let us not diminish what they do—that many of their ideas will not produce the results that they desire. It is certainly not for us or any other democratic nation to attempt to impede the decisions that, in the two examples that I gave, will, we hope, deliver clean, affordable water to people who have none at the moment.
I find myself speaking in a House full of hon. Members who are experts in the subject, and I am anything but. My purpose today is mainly to congratulate those on the Conservative Front Bench for raising this subject. My hon. Friend Mrs. Spelman made an elegant and splendid speech and I wish that we had many more people like her who were able to make such speeches.
I congratulate my hon. Friend on showing clearly that there is no reason why any party in the House should have a monopoly on compassion. She demonstrated that the Conservative party feels strongly the pressures and difficulties faced by developing countries. My hon. Friend also expressed very ably the reason why trade and globalisation are part of the answer to the question, and there appears to be consensus on that point.
I also wish to congratulate the Secretary of State, because she has attacked as nonsense the position of those who argue against globalisation—an important stand. She took that stand at a time when to do so was not straightforward, and it was very influential, because of where she comes from on the political spectrum.
Many hon. Members on both sides of the House argue that the liberalisation of trade will be effective in eliminating poverty and raising living standards all around the world. We have evidence of vast transfers of wealth from the rich world to the poorer world in the form of investment, equity and commercial loans. We also have evidence that such direct investment often helps to underpin struggling democracies or to topple dictators, and brings increased living standards in such simple things—to our eyes—as access to telephones for hundreds of millions of people. With all those proven benefits and what we have seen of the ways in which living standards have been transformed—especially in China and other countries of the Asia-Pacific region—it is extraordinary that we still have a vocal lobby against globalisation.
In this debate, I have been concerned that the amount of consensus in the House leads us to underestimate the extent to which an irrational argument is going on outside. The anti-globalisation point of view appeals to a surprisingly large number of people. In the examples of Seattle and Genoa, I was struck not so much by the demonstrations and violence on the streets but by the fact that an incoherent argument could strike a chord with such a broad spectrum of public opinion. That is true of public opinion in Britain and in much of Europe, and to a lesser extent in the United States.
Today, we have a broad-based commentariat who are influential in creating public opinion. In this country, we have a large middle class, of which only a small minority is involved in the process of wealth creation. As a result, the anti-globalisation movement, and the echo that it has in public opinion, is a demonstration of a widespread lack of understanding—even a distrust—of enterprise, commerce and business.
My second purpose in speaking in the debate is to propose to my hon. Friends on the Front Bench that they should go further than the step that they have taken today. There is an important battle to be fought to win the case for free trade, enterprise and wealth creation, because the amount of hostility to wealth creation generated by the anti-globalisation movement is merely symptomatic of a broader misunderstanding of wealth creation and a mistrust of the way in which companies perform.
I do not claim that there are no examples of companies behaving badly, even disgracefully. Indeed, because what happens here and what happens in developing countries are linked in people's minds, business often does itself no favours. The frequent flurries that we have over executive pay are just one example that makes it difficult to explain to people on low incomes in our own country, let alone those in other countries, why the enterprise system is valid. Today, there has been another rumpus over executive pay at Vodafone. On each occasion, the problem is not that executive pay cannot be justified; it is that people are unwilling to be transparent about their policies on executive pay.
The same is true of the development question. One of the reasons why anti-globalisation has struck a chord with a broad group of people is the sense of a growing lack of accountability in all sorts of areas. There is a feeling that more and more of our lives, and of the lives of people around the world, are being determined by people who, in the end, are not answerable to voters and are not accountable.
Some of the fire has been directed at international institutions. For example, the International Monetary Fund is now in an extraordinarily strong position to impose policies that have very severe political consequences, such as changing Governments. Sometimes, those policies change Governments that are very bad—in my view—into better Governments. That is not a justification in itself, however, as an organisation that has that kind of power, and that makes decisions that have such consequences, needs to be transparent and accountable. I would like my hon. Friends to argue for that.
Let us take the example of an organisation such as the World Bank. The criticism that has largely been made of the World Bank is not so much that it has gone around the world being high-handed but that it has been attracted to faddism—it has followed different initiatives of different non-governmental organisations.
While we are talking about accountability, let us include the NGOs in that discussion. I am pleased that those questions have been raised in several Labour Members' speeches. People who work for NGOs, for Oxfam or for Christian Aid now wield great influence, but they have a duty to account for their positions and their legitimacy in arguing cases that may simply be matters of personal political opinion or prejudice that have no democratic legitimacy. Indeed, the benefits that they bring to the people in developing countries whom they claim to represent may be questionable or not to their benefit at all.
I have only a couple of minutes left. I hope that the right hon. Lady will forgive me if I continue.
In the same way as it was Richard Nixon who could go to China, I believe that parties of the right—the Conservative party is one, but there are other such parties in other countries—can do the most to persuade business of its obligations and responsibilities. The strongest case exists for arguing that free enterprise will be the greatest influence in reducing poverty, raising living standards and reducing inequalities. There are powerful examples of companies that, through their investment, have lifted and improved the living standards of people who were previously held in much worse conditions of employment by local mafias and groups of thugs. We know that this is a complicated matter, as developing countries do not wish us to impose labour standards on them that will be protectionism in disguise.
That is another reason for transparency. My party and other right-of-centre parties should be working with enterprise and the private sector to persuade them to be very transparent, to adopt codes of practice, and to open them up to scrutiny, discussion and monitoring. That will demonstrate that enterprise is the solution to poverty in the world and not the cause.
There is a very broad battle to be fought and won. In the end, it is not only a question of development. As long as a vast section of our commentariat—our middle classes—distrusts business, it will be difficult for our enterprise system to function successfully, as it should.
I am delighted to follow Mr. Portillo for two reasons. First, although there is a lot of consensus in the House, we are all struggling to find our way forward. He approached the topic with a very welcome openness. I shall return to his second point on transparency and its importance in causing development.
I want to return to the Secretary of State's opening remarks on rejoicing about today, the movements that have been made, and what those movements meant. We have moved from a development model in which a development Minister goes around the world opening her purse or his wallet and disbursing an ever-diminishing amount of money. Development policy must now be Government policy.
The chairman of the Select Committee is present and he will remember what happened the first time members of the Select Committee visited the department of the Trade Commissioner in Brussels. That was enormously important and would not have happened in the past. Why should members of the International Development Committee visit the commissioner? We were greeted with pleasure because the relevance of our visit was recognised. I am delighted to say that Pascal Lamy, the Trade Commissioner, will come to speak to us next week about development. That is an enormous step forward because, in the past, the commissioner's job was seen as building fortress Europe. The man responsible for the everything but arms initiative will come here to talk about how he can assist development.
I congratulate the Opposition on choosing this theme. We should take an important step forward and work with the British people. Many of them have realised that appalling trade rules are in place and that such rules benefit the wealthiest companies and the wealthiest countries and poison the future of the poor.
I return to the point about transparency, but wish to refer to an issue that has not been mentioned. It is not part of the Trade Justice Movement campaign, but it involves the most fundamental kind of trade justice. We should take action to stop corrupt rulers and elites robbing countries of their natural resources and condemning their people to poverty.
Simple transparent changes in the accountancy rules and financial regulations for our companies—particularly those that work in extractive industries, such as oil, diamonds and gold—would make an enormous difference. We should require oil companies and others to publish what they pay to the Governments of the countries in which they work. That would curtail the looting that impoverishes developing countries. The campaign, "publish what you pay", has been launched by George Soros, Global Witness and some of our best companies and non-governmental organisations. It would simply require companies to say what they pay to countries in the developing world.
Let me give a personal example. I have been going to Nigeria for about a dozen years, and I had been looking forward to going with the Select Committee to see for the first time Nigeria under a democratic Government. Previously, the country was run by deeply corrupt military dictatorships, and Mr. Robathan will share my views on that. It was a deeply disillusioning experience to go there.
Nigeria discovered oil and plunged into poverty. There is not the slightest doubt that it is a wealthy country that achieved deep poverty because it discovered oil and because Nigerians robbed their country of its resources. When I went there, it was clear that the gravy train continued. It was a democratic society, and it was clear that the politicians had learned their scripts about the forgiving of debt and returning the Abacha money. However, they could not answer a single question about how much money was going from the oil companies into the Nigerian Exchequer. The oil companies and the Government do not say.
After three years of democratic Government, it should have been possible to point to the schools, the clinics and the services that were there because democracy was in place. However, not one politician or civil servant could point to the improvements that had occurred and that would have resulted if 90 per cent. of the oil resources—or whatever the figure may be—had gone into the Nigerian economy.
I do not question the credentials of President Obasanjo, but he is imprisoned by the system within which he has to work. We have probably all worked in circumstances that were mildly corrupt and in which the whistleblower was everyone's enemy. The whistleblower might even fear for his life. The fact that it has been relatively peaceful in Nigeria at a central Government level indicates that the gravy train continues. That will not change until we help by changing our rules. We need to say to BP, Shell, Exxon, Elf Aquitaine and other companies that work in those areas, "Publish what you pay." That would be an enormous step forward.
I back the campaign by George Soros, Global Witness, Oxfam and many of our best companies. BP wants to declare what it pays, but Sonangol, the Angolan company, threatened it with losing future rights if it did. Companies must declare what they pay because then the people will know what resources are in their countries.
Let us take Angola. We rejoice that Savimbi has gone. He was sustained by diamonds. The dos Santos Government in Angola were sustained by oil. But the people of Angola were sustained by nothing. In 2001, the UN had great difficulty raising the $200 million necessary to feed 1 million Angolans who were dependent on emergency food aid. In the same year, Global Witness calculated that more than $1 billion—about a third of state revenue—went missing in unaccountable loans and in paying for highly overpriced military goods, which came in particular from Russia.
We can have no faith that Angolan politicians will put that right on their own. We have to help by ensuring that developed world companies are not part of the problem. About 90 per cent. of Angola's revenue comes from oil. Whereas in the developed world it would be routine for BP, Shell or any other company to publish what it was paying to the Government, that is not the case everywhere.
Global Witness has done wonderful work around the world. I see colleagues in the Chamber who visited Cambodia, where we heard that the forest would be gone within about three years because the military was robbing the country of its forests. There are no resources there.
Global Witness is doing great work in Sierra Leone and Liberia. The simple measure of requiring companies worldwide to say what they put into a developing country would give the people of those countries the power to hold their Governments to account. At the moment, they cannot, and I commend the work of Global Witness and the campaign, "publish what you pay". We all agree about aspirations, but we need concrete specifics on what we should do.
I shall concentrate on the agricultural aspects of trade because they have featured heavily in our debate.
When people returned from Doha eight months ago after reaching what was an unexpected agreement, a great deal of optimism was in the air. After all, we had pulled it off. The French had had difficulties but they finally produced acceptable phraseology, although subsequently it was slightly disputed, and the Commission said that we had agreed to achieve an accord on the modalities of common agricultural policy reform. Modality does not mean the framework but the detail—the nitty-gritty—of CAP reform, which is to be achieved by May 2003. It is important to realise that we are talking about trade-distorting subsidies. No one is talking about eliminating agricultural subsidies. The Government are talking about transferring subsidies to achieve other public good purposes, however they are defined, away from trade-distorting or production-related subsidies. It is important to be precise about that.
We then had the body blow of what happened in the United States. There is no point in blaming President Bush; the initiative was started by Democrats in Congress. Republicans ran with it and the President did not want to argue against it. Given the characteristic honesty of the Secretary of State, I am surprised that the Government motion does not mention the American Farm Bill. After all, it has been the villain of the piece throughout this afternoon's discussions, and rightly so.
It is envisaged that the Bill will give $190 billion over 10 years to 2 million American farmers. The interesting thing is how the Americans chose to defend it, because Ann Veneman, the Secretary for Agriculture, effectively said, "Over the past four years, we have piled additional appropriations into agriculture year after year. This is not a unique example of sin. We have been doing it all along and we have put in some $30 billion—you just didn't notice it." Now that the big numbers are there, we have suddenly noticed the context, which is the impact on the world trade round.
It is true that the so-called American "cap" in the WTO is just over $19 billion, so the American expenditure falls below that. However the problem is that the Americans seem to be moving towards that almost as if it were a target, whereas other major regimes have made an effort to wind down some forms of support and change their purpose. The Europeans were dragged kicking and screaming into the Uruguay round, but in fact the greatest influence on reform of the CAP has been the restrictions that are in place, which still persist in the Uruguay round, and the demands of retailers and consumers.
What is happening in America is horribly counterproductive. The measure represents a deficiency payment, so increases will go straight through into land prices, and it will provide production incentives, which will keep world prices low. The Bill will not have a long-term benefit for American farmers; I think that it may be of greater benefit to the competitive position of south American farmers. However, it will have a much wider consequence for the rest of the world because the low level of world prices is one reason for the amount of competition on the world markets. That is why it is so easy to export to developing countries and to shut them out of some marketplaces.
The second wider consequence is that President Bush's action in signing the Bill was manna for every protectionist throughout the world, as we can see from the speed and alacrity with which some of the farm lobbies jumped on it. Their dexterity was amazing to behold. The politicians have piled in on top. The odds of reaching agreement on CAP reform and in the WTO round seem to be much longer, and one reason is that the pretext has been broadcast from Washington. Its action seemed to be so much at odds with the philosophy so habitually espoused by the Americans.
I venture to say that there is a real challenge for those of us who are strongly pro-American and who instinctively think of America as our partner to persuade that great country to re-engage in collective action in all sorts of spheres across the globe. We have seen the United States apparently refusing that collective action—in discussions on climate change, on the alleviation of poverty, on mechanisms for international justice, on steel and then on the Farm Bill. There is a serious concern that, when we all accept the need for collective action to combat terrorism, such action should spread more widely throughout what we call the international community.
I said that the American action would promote protectionism, so step forward, right stage, Jacques Chirac, who has just been re-elected President of France with an enormous majority. I am sure that the Prime Minister will welcome the defeat of a Socialist Government who were so resistant to liberal economic reforms, but I hope that he has no great faith in President Chirac's conversion to the liberal economic model, which has yet to be espoused with great enthusiasm by any French politician brought up in the Napoleonic tradition.
The real significance is that we are facing the mid-term review of the CAP. Commissioner Franz Fischler is due shortly to produce his proposals. Those who say that the CAP does not change and that it is still a desperate aberration have not noticed what has happened over the years. I have spent almost all my political life fighting for reform of the CAP, and I continue to do so, but it has shifted enormously. It is moving away from production-related subsidies and towards the espousal of rural development more widely, which makes a great deal of sense, and that is one of the purposes of Mr. Fischler's reform.
The Europeans are retreating from production-led subsidies just as the Americans seem to have reverted to production-promoting subsidies. It is extremely important that Mr. Fischler wins his battle with the Council of Ministers, but it now looks like a harder battle to win. President Chirac was a farms Minister, and his main complaint about the CAP is probably that there is not enough of it. It will be a difficult argument to get consensus and build a majority in the Council of Ministers in favour of promoting liberalisation.
Liberalisation is in our interests. Some hon. Members might enjoy eating Polo mints. The sugar-free Polo mints are made by Nestlé Rowntree at York; the fruit-flavoured Polos are made in eastern Europe, because thus they escape the sugar regime and the costs it imposes on business. If hon. Members look at some of the oils produced by Cargill, they will find that investment is now going to Turkey or Ukraine, even though European prices in the grain and oilseed sector are now much closer to world prices and have become manageable.
We have to face the fact that it is entirely possible that in Germany Mr. Schroder will be defeated, if there is indeed a rightward swing taking place across Europe. Edmund Stoiber is promising to liberalise, despite the tradition of Bavarian-run agriculture in Germany, and I doubt that he would be dragged along on French coat tails, as has too often been the story of German policy. However, the Germans want enlargement, and they cannot afford enlargement unless there is reform of the CAP and their contribution decreases. There will therefore be pressure on Mr. Stoiber to maintain some form of liberal agenda.
All those factors come together. CAP reform has implications for enlargement, and those two factors combined play into Doha. The important thing for all of us is to maintain that movement for reform so that we are able to benefit developing countries, which stand to gain from trade. The victim concept of world trade is incorrect and misguided. Liberalisation, domestic and international, has benefited developing countries and has reduced poverty. A 2002 World Bank study called "Globalisation, Growth and Poverty" has shown that most effectively.
We need to reassert the WTO agenda. The Prime Minister is dining with Mr. Chirac tonight, and he is shortly to visit north America to discuss the broader issues. It is important that we make the point that liberalisation works. Whether we prefer to describe the case for helping developing countries as philanthropic or self-interested, all of us have a self-interest in ensuring the promotion of liberalisation, so that the world can continue to grow richer through the spread of liberal political philosophy.
As several hon. Members have said, it is good to see so many people on the streets outside Parliament today. People from all parts of the country have travelled to London to make their voices heard and to hear what we have to say. I hope that we do them justice and that contributions from both sides of the House continue to be positive and constructive.
The issue we are debating has struck a chord with many people from all walks of life and with hon. Members on both sides of the House. As with the Jubilee 2000 campaign to which my hon. Friend Dr. Tonge has referred, the number of people who have become involved in this issue, who have raised it with me during surgeries and who have written letters and sent postcards, is quite incredible. For thousands of people to come to London today, something is clearly wrong—so badly wrong that people feel a sense of outrage and injustice. People outside are not asking for a better deal for themselves. They are saying, "Give the poorest of the poor and the hungry and the starving of the world a fair deal—let them have a chance to help themselves, and end a trading system that kicks people when they are down."
If life is about choices, the contrast between rich and poor has never been so stark. When shopping for food, we often have a choice of 20 different types of cheese, a wall of cereals, and teas and coffees from around the world; meanwhile others no less deserving than ourselves eat grass or sawdust, or starve to death. As if things were not bad enough for the poorest of the poor, the rules of international trade—those relating to the provision of the basics in life, such as food and water—seem to be designed to make them even worse off.
If a Jaguar fighter bomber, a combat helicopter or submachine guns is required, the wheels of commerce with developing countries spin at great speed. We have only to look at the latest strategic export controls annual report, which details arms deals approved by the Government in 2000, to see that poverty-stricken states such as Bangladesh, Malawi and Sudan are not kept out of the trade loop entirely.
If finance and credit arrangements can be developed to fund some very dubious purchases, such as the £28 million air traffic control system for Tanzania, surely it is not beyond our capabilities to introduce fair trading rules for some of the most basic items that sustain life itself, but we have not done very well so far.
We have developed a system that undermines the price of crops in developing countries so that farmers cannot sell on the world market, because wealthy nations of the world have subsidised crop prices to a point where their crops are effectively dumped on to the world market. We have a system that can leave the poor without drinking water, while tourists at expensive resorts nearby have their thirst quenched by a water system that has been priced out of the range of local people by a trade agreement which stops their Government providing socially desirable drinking water.
We have a system under which farmers who for generations have used seeds to grow crops are told that the right to purchase that same seed is now owned by a multinational company which has purchased the patent, and that farmers must not only buy the seed from it, but must pay the new owner a royalty for using the seed. When we have such a system, we have a rotten system, and we had better do something about it, or the people outside will want to know why.
What has outraged so many people outside Parliament today is that existing trade agreements and proposals around the corner are grinding the poorest of the poor into the dust, while improving the lot of the better off. The real tragedy is that it need not happen at all. The United Nations estimates that poor countries lose £1.3 billion a day because of unjust trade rules—14 times more than they receive in aid.
Although there are moves to write off the debts of some of the poorest countries, and some progress is being made in that direction, the scale of the remaining problem is daunting. More than half of the heavily indebted poor countries are spending more on servicing debt than on primary education, and two thirds of the world's poorest countries are spending more on debt than on health care.
In order to trade, those countries must have the shackles of debt removed at the earliest opportunity. In respect of countries to which loans have been provided, we should end the conditions that force them to open up their markets too quickly to the full strength of competition from industrialised countries, which can undermine local producers with subsidised goods or, in the case of farming, expose local farmers to competition from the relatively protected farmers of Europe and the United States. That can have a devastating effect.
Hon. Members have mentioned examples from around the world, such as Ghana, where the market for rice collapsed while rice from the US was flooding in. In contrast, there are good examples as well. For instance, Mauritius adopted a positive trade regime which resulted in a wide range of products being exported, economic growth, a reduction in income inequality and an increase in life expectancy. A targeted trade policy with the right incentives can help exporters and produce a win-win result.
The World Bank estimates that the reform of the international trade rules for developing countries could lift 300 million people out of poverty. We must make a start. In Europe, we must reform the common agricultural policy to stop dumping and agree deadlines for doing that. Pressure should be maintained on all those who attend the ever-increasing number of summits, such as the world summit in South Africa later this year.
There is no excuse for patenting any plant form that has been grown for generations, and changes must be made to stop that scandal. Markets must be opened up to developing countries and the practice of dumping agricultural products on world markets must be stopped. The EU has failed to provide access for all exports from the 49 poorest and least developed countries in the world, and that must change. Recently, as was mentioned earlier, the US Farm Bill increased subsidies to American farmers by 70 per cent. over 10 years, making it even harder for developing countries to compete or enter the US domestic market.
Trade agreements should be developed to help the poor, to protect the environment and to be a force for positive change. If that development does not take place, we shall all suffer as we help to develop a world where the obese watch the poor starve to death on television. All that is being asked for is what is fair. We should settle for nothing else.
I congratulate my right hon. and hon. Friends on recognising the importance of the issue by devoting the debate to it. I congratulate also the 10,000 people who have emphasised their concerns by coming to London and demonstrating on the streets of London. Somewhat unusually in an Opposition day debate, I congratulate the Secretary of State on a constructive and, in some ways, brave contribution, and one which I welcome.
I was keen to participate in the debate because before I was elected to the House, when as my mother puts it, I had a proper job, I was for the best part of a decade involved in working on aid programmes in developing countries. I have always been concerned about these issues. I reached one conclusion overall as a result of those years of experience that was rather unfashionable at the time. That was that peoples in developing countries—I worked primarily in Africa, but also in Asia—can and will become prosperous in due course, as other countries have before them, by their own efforts and not as the result of aid provided for them by others. Aid has an important humanitarian role in dealing with famine and in supporting health and other infrastructure, but ultimately countries can and will develop through their own efforts.
I had experience in developing countries and I was unable to identify an industrial project that could not be financed privately and that needed aid finance. Indeed, I undertook a study for the United Nations Economic Commission for Africa. It was welcomed by that body, and it was so keen that it wanted to provide support for it. Such is the speed of bureaucracy that by the time it got round to it, every project that I had identified in countries that allowed free enterprise to operate had spontaneously been put into operation by local entrepreneurs, using local savings or employing outside investment.
These countries can develop themselves, but the speed and ease with which they do so will depend on the opportunities open to them, and above all the opportunities to trade with the already prosperous and developed countries.
As the Oxfam report suggests, trade is far more important than aid in quantitative terms for the growth of developing countries. That is why the hypocrisy of the developed world, which pretends to be in favour of the development of less developed countries but reserves its most severe protectionist measures for the poorest countries and the poorest people in them, is so tragic. It is shameful to us as members of the European Union that the Oxfam report, in its double-standards index, singles out the EU as the worst hypocrite in that respect. Our tariffs and protectionist measures tend to focus on areas that are most important to the third world, such as agriculture, labour-intensive manufacturing and anti-dumping measures. They are focused on the products that are in the most competitive markets. There are about 145 EU anti-dumping measures against products from developing countries. There are a further 80 from the United States and 22 from Canada.
I believe that such shameful hypocrisy is sustained by three fallacies. The first is the belief that trade is a zero sum game. It is thought that if someone does well, that is at the expense of someone doing badly. It so happens that a benign providence has ordained that both parties benefit from trade. We need to convince our colleagues, including our French colleagues, who are perhaps less familiar with this concept, as my right hon. Friend Mr. Curry said, that it is possible for both us and the developing world to benefit from opening our markets to them.
The converse is that both sides suffer from protection. Protection is much the same as imposing an embargo on a country. I think that it was Winston Churchill who said that prohibiting access to imports is what we do to our enemies in times of war and to ourselves in times of peace. We must convince our colleagues in the EU that preventing our people having access to the products and services that those in developing countries can competitively provide us with is damaging to us as well as being cruelly damaging to them, and utterly indefensible morally.
The second fallacy is the patronising belief that less developed countries cannot compete. That leads to a sort of new liberal imperialism, to a view that developed countries should be kept outside the global market, to be sustained by aid and hand-outs unless and until the rules can be changed to bias the system in their favour so that they can compete.
That is often expressed in calls that contrast free trade with fair or just trade. That is an unwise mistake. For the developing countries, free trade in the sense of free access to our markets is what is fair and just and what they need. We must not offer an excuse to those who wish to delay the dismantling of protection by saying, "We cannot do that until we have fair trade, or just trade. Free trade is a wicked, dangerous liberal Anglo-Saxon invention."
That approach is also dangerous in that it is used to justify the contrast between free trade and fair or just trade. It is used to justify the restrictions that are often upheld by the third fallacy that I wish to mention, which is almost the opposite of the second. It is the belief that far from developing countries being unable to compete, they are able to compete with our industries unfairly because they are willing to accept subsistence or poverty wages, which are said to be an unfair means of competition that will have the effect of driving down pay in Europe to levels elsewhere.
That argument is often used to justify anti-dumping restrictions on trade from countries where pay is extremely low, where employment conditions are inadequate or where environment standards are low. However, it is ultimately an absurd argument. It condemns people in developing countries who at least have minimal or dreadfully low rates of pay to have no pay, and no access to our markets until somehow, miraculously, they are in a position to receive higher pay.
Pay reflects productivity. No one can charge more than the value of what he produces because he will price himself out of the market. Pay is low in developing countries because productivity is low. It is not because people are incompetent or inefficient. It is because they have not had time to accumulate the capital, both physical and intellectual, which works alongside the labour of developed countries and enables an individual to produce perhaps 10 times as much in value as those in developing countries.
As developing countries are allowed access to our markets and build up and acquire capital—especially the intellectual capital of experience—they will increase their productivity and their pay will rise. The idea that they willingly accept low or subsistence wages and are prepared to continue doing so until they have driven us all out of business is nonsense and defies the experience of countries that have satisfactorily entered the world market, built up export markets and built up their own economies.
We must fight these fallacies if we are to overcome the hypocrisy that unfortunately means that we impoverish the third world at the same time as diminishing our own well-being. We can convince the people of Europe, as of our own country, that it is in our interests as well as being our moral obligation to those in poor countries to open our markets to their goods, and that we shall benefit as they benefit. We can then do ourselves a good turn as well as fulfilling our obligation to the poor and needy of the world.
I should like to concur with everything that my right hon. Friend Mr. Lilley has just said in an excellent speech. As you have been in the Chamber, Madam Deputy Speaker, I do not think that you will have had the opportunity to go outside and see the huge number of people taking part in today's demonstration and lobby of Parliament. What is most impressive about the demonstration is that it shows how many people care deeply about world poverty. That is extremely important and very encouraging for us all. The Secretary of State said earlier in a sedentary intervention that the Conservative party had changed. She is quite wrong, as huge numbers of the people outside are Conservatives. Indeed, huge numbers of supporters of the NGOs have always been Conservatives, as I suggest she knows full well. I do not know whether the majority are Conservatives, but there is certainly a great number of them. None the less, this is not partisan issue and there is general agreement throughout the House in all the speeches that have been made.
I was not trying to speak in a sectarian spirit in raising the issue, but the record of the Conservative party in power is different from the welcome position that it has now adopted and to which the hon. Gentleman makes a big contribution. That is a very welcome change, but it is change none the less.
I shall not get into that argument in a 10-minute speech. I disagree with the Secretary of State on this issue, as on few others relating to development, although I disagree with her profoundly about many other matters. It is a pity that the Government have tabled an amendment to the motion, as it contains nothing that is offensive to them. I will be sorry if it forces us to a Division, because everybody who has spoken has generally agreed.
The problem about speaking late in a debate, as I always tend to do, is that all the points that one had wanted to make have often been made already. I will not repeat them, but excellent points were made by my hon. Friend Tony Baldry about Italian tomatoes in Ghana, by Glenda Jackson about NGOs and how they sometimes wish to stifle changes in culture, and by my right hon. Friend Mr. Portillo, who referred to the accountability of NGOs, which we should revisit as a House. My fellow member of the International Development Committee, Tony Worthington, spoke about the oil corruption that he saw in Nigeria, but which I did not see.
I do not want to reiterate all the points that have been made, as it would bore the House, apart from anything else. I should like to stick with three issues. The first is the common agricultural policy, which was eloquently described by my right hon. Friend Mr. Curry. The policy is changing, and that is all to the good. I should state that I have an interest, as I am a farmer. I probably should not be arguing for greater reform, therefore, but I do so, because I think that the way in which farming and export subsidies are given is absolutely outrageous. It is sometimes very difficult to look the developing world in the eye with regard to this issue, on which I think that the Government and the Opposition are at one. This dumping—some of what is happening is dumping—costs us almost half the European Union budget, at a cost of 41 billion euro, and works against the environment, the consumer, farmers, who are driven out of business, and the developing world.
The second point, which was again raised by my right hon. Friend the Member for Skipton and Ripon, is about US farm subsidies, which are moving in entirely the wrong way, representing some $180 billion or $190 billion dollars over 10 years. In so far as one should support any foreign Government, I support the Government of George Bush, but I regret the decision. My right hon. Friend pointed out that it was a Democrat-led decision as much as anything else, but I think that we would all agree that it was a retrograde step.
Indeed, we can see the developed world getting richer. In my lifetime, it has become profoundly richer. We have bigger cars, we eat more and we have problems with obesity—problems that did not exist when I was born in 1951. We are all getting richer, and while that is happening, parts of the developing world, especially in Africa, are getting dramatically poorer. That is very disturbing and distressing. My third point is this: what are developing countries doing for themselves?
I recently visited Sudan, and I visited the Congo last year. The sort of conflict that has taken place there destroys trade and deters inward investment. Besides killing people or making them starve, it exacerbates and causes poverty. From speaking about the Congo, one can move on to Zimbabwe, which has traditionally exported agricultural products, but is now starving. While it is starving, the kleptocracy of the military in Zimbabwe is looting the diamonds of the Congo. We are not responsible for that—those people are.
My hon. Friend the Member for Banbury mentioned tomatoes in Ghana—a country that is doing well and improving. I visited a tomato field there where four big pumps had previously been used to irrigate an area of about 45 hectares. At the time of my visit, however, only about eight hectares were being irrigated with one smaller pump. The reason was straightforward: nobody had bothered to invest in the pumps. There had been appalling management and a lack of investment—for all I know, there may also have been corruption—but it is no good blaming the developed world for that.
I am afraid that such problems are due to lack of capacity. The Secretary of State talked about increasing capacity in developing countries and that is what we need to look at. I think that the plant was run by a co-operative, but it could just as easily have been a foreign-run company. We moved on from the unirrigated fields to the tomato processing plant, which had closed down two years before and was a derelict site. Again, that was not the fault of the developed world, but was purely a fact—so it appeared to us and so we were told—of inefficiency, maladministration and poor management.
Oxfam raised the issue of rice in Ghana with me just before the visit, so while in Ghana I asked what had happened to the rice industry. The Ghanaians replied that the rice produced there was not very edible and that they preferred the imported rice. I do not know about that, but it appears to be the case. Again, we must not always blame the developed world.
My real point about this issue—the Secretary of State will not be surprised to hear me say this, as we have been smiling at each other about it—concerns corruption. We have heard about Uganda and how poverty there fell by 40 per cent. in the 1990s. Why not Nigeria, the second country that the Committee visited this year, which was mentioned by the hon. Member for Clydebank and Milngavie? I understand that in 1980, its GDP per capita was approximately US$1,200, but by 2000, it was down to not much more than $300. Yet that country has oil revenue of US$18 billion a year. Where is that money going? Why are two thirds of the population living on less than a dollar a day? I am afraid that it is very obvious where that money is going; it is being picked from the pockets of the poor by the kleptocracy that runs that country. As the hon. Member for Clydebank and Milngavie—I hope that he is also a friend—said, it may call itself a democracy, but we need to see a lot more action there.
Other hon. Members want to speak, so I shall end my speech with these final comments. Yes, we must make trade fair. That is absolutely essential. It must be equitable, but equity and fairness must extend and reach down to the very poorest in the developing world, because it is the poor who suffer most from poor governance. Let us ensure, of course, that our trade is fair, but let us also help the countries of Africa to develop good, open, fair and honest government. That is not easy, but it is absolutely essential.
Like my right hon. Friend Mr. Curry, I want to concentrate on food and agriculture issues, but I am in an unfortunate position, as my right hon. Friend Mr. Lilley has already dismissed part of my argument as an absurd fallacy. I hope that I can persuade him to retract at least slightly.
As somebody who has spent most of his working life in or close to the world of agriculture and food production, whenever I visit any foreign country, but especially those in the developing world, I immediately consider that aspect of their world and their rural community. Like other hon. Members who have spoken from all parts of the House, I am often horrified to discover the amount of food that is being imported by a poor country that patently has the natural resources to produce that food itself. There are very few countries that could not meet most, if not all, of their basic requirements if the political and economic situation allowed them to do so. I do not think that many countries have such a natural disadvantage that they could not make a significant contribution.
Mr. Curry mentioned the distortions of international trade and low prices. Commodity prices are still falling and falling, and that feeds into inefficiency. Allowing Africa to process its agricultural production, bring it into our markets and use its cheaper labour would create more efficiency. We are partly responsible for the gross inefficiencies because prices are so terrible.
With respect, I am not quite sure of the point of the Secretary of State's intervention. I do not dissent from her argument, as I said that there are not many countries with natural disadvantages such as climate and soil that would prevent them from becoming largely self-sufficient. However, I shall come on to the many other reasons that may stop them.
It is misguided to think that there may be simple solutions. All these countries face the dilemma of whether their priority should be to produce food for their own consumption and make sure that their own people have the necessary nutrition, or whether to earn money from exports, which go much wider than agriculture alone. That has been a dilemma for decades. Some of us are old enough to remember the abortive groundnut scheme which created a furore because it was aimed at exports rather than self-sufficiency.
A few years ago, I visited Zambia with Hugh Bayley. We went to York farm, a large operation, developed by the Commonwealth Development Corporation. It has since been sold, but it produced vegetables, primarily green beans, mangetout and so on, for export to supermarkets in this country. Many of its products were for the consumer who wanted to buy temperate vegetables all year round. Although it earned valuable income from exports, there was something almost obscene about the fact that the farm managers had to give all the workers a glass of glucose drink in the morning because they were so malnourished that they could not do a day's work without it. That is a sad indictment of the balance that we have managed to achieve in world trade.
There is huge potential in Zambia and many adjoining sub-Saharan countries. Several hon. Members referred to Zimbabwe as a prime example of self-inflicted problems. Having once been a major producer of food, the country is now in dire straits. However, protection and protectionism are not the right way to proceed. There are a lot of siren voices and there is a superficial attraction in a protectionist attitude that allows a country's agriculture to develop free from cheap imports. That attraction, however, is short term and stifles initiative and progress. As Glenda Jackson said, it smacks of preventing any development or advancement for people. There is no long-term future in peasant agriculture, and increasing affluence will lead people away from it of their own volition.
"Africa loses 40 per cent. of the savings that it generates each year. That money flees the continent every year."—[Hansard, Westminster Hall, 10 April 2002; Vol. 382, c. 19WH.]
I submit that that is partly because many people do not have the confidence to leave their money in Africa as a result of the political instability, corruption, maladministration and sheer bad economic management that are at the root of many its problems.
On agricultural policies, as other hon. Members have said, the CAP is a major part of the problem, but it has changed and is changing. However, that change needs to go much further, as it does in agricultural policies in other parts of the world. I wholly support the need to eliminate export subsidies, which do much damage to indigenous agriculture. There is no dispute among hon. Members about that. There is no justification for any tariff barrier imposed directly on food products and I strongly support eliminating production subsidies. As my right hon. Friend the Member for Skipton and Ripon rightly said, the Doha agreement refers to reductions in support that distorts trade, rather than reductions in all support. I share the concerns of many people about the hypocrisy of the United States in supporting the Cairns group in WTO talks for moving towards free trade on the one hand and on the other introducing the Farm Bill, which was rightly condemned by many hon. Members this evening.
However, to pick up a point made by my right hon. Friend the Member for Hitchin and Harpenden, I have a major concern about fair trade, which should operate in two directions. There should be fair trade to developing countries and for our own businesses, which raises two distinct issues in food and farming.
The first is the safety of imported food products for human, plant and animal health. If we impose controls on our own producers, it is self-evident that the same controls should apply to any imported food. Those controls are provided, at least in theory, by Codex Alimentarius, the international plant protection convention, the Office of International Epizootics and the sanitary and phyto-sanitary agreement in the Uruguay round, but they should not be used as an excuse to adopt high levels of protection as a barrier against trade. In practice, there are grave doubts as to whether those controls are rigorously enforced.
The second issue is production systems. Should we expect our own producers to compete with food produced using systems that are not allowed here? I am not referring, as my right hon. Friend did, to matters such as pay levels, on which we cannot pretend to compete, nor to climatic issues or other things that we cannot do anything about in this country. If we impose constraints—I am talking about agriculture, but this applies more widely—on animal welfare, it is not fair to expect our producers to compete with countries that do not have the same level of regulation. I used to advocate preventing those food products from coming in. I was wrong. The way forward—this is part of the reform of the CAP that I want—is translating production support, which is wrong, into direct support to compensate for the controls that we impose on our own producers and do not apply to the overseas producers who are entering our markets.
It is no comfort to a battery hen to know that she will no longer have to stay in a battery cage in Britain if far more hens are kept in battery cages somewhere in the third world in far worse conditions. That is not in the interests of animal welfare nor of this country or the developing world. Our reforms should be directed at the public good and compensate for the controls that we impose on our own producers. That proposal was submitted to the WTO in 2000 and would have put payments in the green box, and thus outside the issue of production subsidies. I commend that strongly to Her Majesty's Government as part of the liberalising of trade that we support.
Today has been unique, as people from all over the United Kingdom have come to the Commons to lobby Members. They are from various backgrounds and different age groups but every Member who has met them must have been struck by the number of young people who feel strongly about the issue.
In the past, we have heard in debates in the House about young people's apathy and lack of involvement. Today, that argument was demolished, as those young people care deeply about this issue and want us to do something about it collectively. We must recognise that they do not want extensive speeches, articles and soundbites but progress and a proper response to their calls for action. In today's heat, the lobby was a breath of fresh air. People spoke with a passion that is sometimes missing in political debate. That was not a one-off just for today, but something for every day for a long time. We must try to ensure that we take on board the points that they are making.
People have an almost absolute distrust of politicians in this respect. Those in today's lobby do not think that we will be serious about delivering on their objectives, but that we will listen to them on the day and, once they have gone, completely forget about their campaign. We need to find a way of saying collectively, across the House, that that is not what we are about. We are all concerned not only to listen to the points that were made to us, but to take them on board and, hopefully, to end up with a political objective with which people will feel confident and comfortable. That is a major challenge to us all, irrespective of political background.
Last week, I had the opportunity to listen to the Chancellor talk about globalisation, trade and poverty. As a Labour Member, of course I was going to be happy with what he said, but it was interesting that people of no political persuasion were delighted by the progress that is being made. However, they did not think that that was the end of the story—they wanted more progress. They wanted the Government to push even further and more strongly at every international level. The lobby is important and timely, given that the Seville European council and the G8 summit in Canada are coming up. Those conferences will be major platforms for the agenda of the people who lobbied us today. We need to find ways of ensuring that something concrete comes out of those conferences—not just a lot of talk, but developments that will enable people to say that, for a change, politicians have made genuine advances and improvements, or at least that they have an agenda that will build on the objectives of today's lobby.
I find a common thread as I speak to people from various parts of the country, including my constituency. They call out for a new and different approach to replace the patched-up arrangements of the past—something more radical. They want an approach to food and farming that protects poor farmers. They want a reconsideration of plans to liberalise vital services such as water. That point was made strongly today. For third-world countries, water is an issue that can be dealt with very simply. I say that as an engineer. Desalination plants can be built in almost any European country and used to convert salt water into fresh drinking water for the third world. It is not a major problem, but we do not confront it and deal with it, and people will die as a result.
We need to make progress on these issues as a House, not only as a Government, because broad support is required. We want to go to the conferences to argue for a position that will take matters forward, but we cannot avoid the fact that we need other countries—in Europe and in other parts of the world, such as Canada and America—to say and do the same thing, giving proper constructive support to our objectives. We do not want to be seen as having a different, broader agenda that will move forward faster—that would be a waste of time, because it will not move forward at all if we do not have a collective approach that takes people with us.
It would also be a waste of time to have a debate about what went wrong in the past. We need to move on to talk about where we are now. People want us to continue to do what we are doing, but they want more of it—more aid and more practical support. The issue will not go away. The people who lobbied us today are nothing more than a representative group of the millions of people who feel the same. We feel that in our constituencies. I particularly salute the work of the Churches, which have played an outstanding role. Not long ago, a local church asked me to get involved in a sponsored day of famine. I said, "No problem: I can do that for 24 hours." The wonderful thing was the number of schoolkids who were prepared to do the same because they felt so strongly about poverty and starvation.
All across the country—age group and political background do not matter—millions of people want us to do something constructive. We need to do that across party lines by agreeing on the agenda and saying, "This is what we are after." It is not a matter of the UK acting alone, but of the UK leading the world and bringing in other countries to support our cause. If we do that, people will at last feel less distrust. They will be happier with politicians who are on board walking the walk and talking the talk, and will give us the proper recognition that is important to us.
I appreciate the opportunity to take part in the debate. Like many hon. Members, I have been attending the lobby and listening to people. I agree wholeheartedly with what my hon. Friend Mr. Lyons said about that. Those people turned up from every corner of the country, and each and every one of them deserves thanks for what they have done. That said, no one from my constituency came. Whether that is because they trust me to act on their behalf or because they think I am a lost cause is up to them to determine.
Two or three years ago, my hon. Friend Mr. Foulkes came to my constituency, and we held an excellent meeting with local churches. It was attended not only by church members, but by young people from secondary schools, to whom this issue means a great deal. This afternoon, I spent a considerable time—perhaps more than they would have liked—talking to young students who wanted to do a question and answer session that they could take back to university with them. One of their questions was, "How much of an impact do you think all this will have?" As my hon. Friend the Member for Strathkelvin and Bearsden said, everyone is saying the same thing, but—let's not kid ourselves—they are sceptical about how politicians respond. The students also wondered how much impact the lobby would have on the news. I had to say to them—and I hope I am wrong—that regrettably they will not get much coverage.
My hon. Friend referred to the young people who lobbied many hon. Members this afternoon. Does he agree that, at a time when we are told that the young are disillusioned with politics, it is extraordinarily cheering that they care so deeply that they come from every part of the kingdom to speak to us? Does he also agree that we must repay that fervour and commitment, otherwise we shall never be worthy of their support or their engagement in politics?
I could not have put that better; I admire my hon. Friend's way with words. He is right that we need to repay that trust. Perhaps young people mistrust politicians rather than politics. However, they will not get news coverage. They tried to compare their actions today with the anti-globalisation demonstrations, but those got coverage because of the violence that occurred—anarchists were loose on the streets in different parts of the world—whereas today there was a structured and positive lobby, which bodes well.
Poverty and sustainable development must be the highest priority in the changes to world trade rules. We must carefully consider plans to liberalise vital services. On the simple matter—if I dare call it that—of water, the difference that it can make to some of the poorest countries is beyond belief. We must be careful about the way in which we manage that vital commodity.
The Seville European Council this week and the G8 summit in Canada later this month present every nation with excellent opportunities to move the agenda forward. Our Government have promised to support fair trade rules, although, for some reason, others question our commitment to fair trade.
Does my hon. Friend agree that in the 10 years since the Rio conference, the international community has not moved substantially? Does he accept that that is one of the reasons for the dissatisfaction among young people? Does he agree that it is important to take the opportunity at the next conference to do something constructive and positive?
My hon. Friend is right. Our actions must be positive, constructive and tangible. We must take action that people can clearly perceive as making a difference.
We want free and fair trade. We are committed to making globalisation work for the poorest countries. Hon. Members have said that rich nations' use of agricultural subsidies can harm the livelihoods of farmers in developing countries. Agricultural export subsidies must reduce rapidly, and dumping must end. As hon. Members know, at Doha, WTO members agreed to negotiate a new draft agreement on agriculture by March next year. The Government will work towards ensuring that it contains significant commitments.
It is not right to insulate developing countries from global trade because that would undoubtedly limit their opportunities of achieving economic growth. Improved market access is a key component of ensuring that the agreement at Doha is a true development round. It is imperative that WTO members demonstrate a genuine commitment to opening markets that are important to developing countries, not least in agriculture. The EU already grants duty-free access to the least-developed countries under the everything but arms initiative.
I am conscious of time and I simply want to end on the new global laws that may be needed to regulate the activities of international corporations. I believe that the Government support adopting a sensible combination of regulatory and voluntary approaches, which will harness the benefits of corporate social responsibility for all sections of society. We are leading efforts to legislate on this matter. For example, a recent amendment to pensions legislation requires trustees to disclose the extent to which they take ethical, social and environmental issues into account in their investment decisions. The OECD convention on bribery has also been incorporated into UK law.
However, to avoid stifling innovation, caution must be exercised when imposing binding rules. The Government encourage companies to follow voluntary corporate social responsibility strategies, which will allow them to respond flexibly to their circumstances and those of the country in which they invest. Such investment is needed.
We all need to begin to deliver not only for young people but for everyone who has taken the time and made the effort to come here today. If we begin to deliver more substantially, people will realise that politicians can assist in tackling a major world issue.
A rare event has taken place today—a debate that has been largely free of acrimony and a debate about ideas. I have been a Member of Parliament for more than 19 years, and I can say that views in both major parties have changed. I have no doubt that the way in which the Labour party has embraced the market constitutes a revolution, which I welcome. In 1983, some Conservative Members would have resented the fact that we were debating overseas aid, development and trade. I concede that changes have occurred on both sides.
People outside the House will wonder why we are arguing about whether to have a vote. It will seem a little like debating the number of angels who can dance on the head of a pin. The usual channels display an amour propre on such occasions: it is our half-day debate and we have tabled a motion. We will, of course, support our motion. The Government's actions remain to be seen. Whatever happens, people will recognise that the debate has been remarkable.
I was impressed by the way in which the Secretary of State abandoned her speech and spoke from the heart. It did not surprise me, but it impressed me and I liked some of the new phrases that she used. For example, she said that we should all globalise our minds and she spoke about the "globaphobes" who attack the consensus. She has provided some new ideas. She is right that we cannot be for or against globalisation; it is a fact of life and we must determine the way in which we manage it.
I was grateful for the approach of my hon. Friend Tony Baldry and his deep knowledge of the subject. He spoke about the painstaking work of reforming the CAP and the Doha process, which will occupy us for at least two years. He also made a strong point when he said that we must support the reformers in the developing countries and that for every monster, there is someone who is trying to reform and bring a country into the international community.
My right hon. Friend Mr. Portillo was right that no one has a monopoly on compassion and to stress the importance of the growing lack of accountability in some non- governmental organisations. He also emphasised the need to promote accountability and transparency throughout development thinking.
My right hon. Friend Mr. Curry knows more than most of us about this subject. I was struck by his comments on the need to make it clear that liberalisation benefits developing countries as much as us.
My right hon. Friend Mr. Lilley spoke about the hypocrisy of the developed world and the shameful attitude of our European Union in not accepting our responsibilities.
My hon. Friend Mr. Robathan drew on his personal experience in Sudan, a country that I feel strongly is one of the great forgotten conflicts and disasters of Africa. He also drew attention to the plight of the people of Zimbabwe who are starving while their own army loots diamonds elsewhere.
My hon. Friend Mr. Paice spoke from great practical experience about the need to examine the issue of food safety, and to take on board the issues of animal welfare and of what is fair for British farmers as well as those in developing countries.
I was struck by the common sense of Mr. Lyons, who spoke of the breath of fresh air that today's debate represents, and of how hon. Members on both sides of the Chamber have had to face up to the problem of distrust of politicians. The hon. Gentleman said that today's events must not be a one-day wonder, and that we must respect the wishes of the thousands of people from across the country who expect us to do our duty in the coming years, and to live up to the words that we have spoken.
We have listened to some serious speeches in the House today, but we have also listened to and witnessed the mass lobby of Parliament that has taken place outside. The thousands of people who have come to London, including those from my own constituency and diocese of Salisbury, represent countless other citizens of all ages who mind very deeply about the state of the world and the plight of so many of its people.
I share their anger that 800 million people do not have enough food to meet their basic nutritional needs. In a shrinking world of high technology and expanding opportunities, it is just not credible to ordinary people in the rich countries of the developed world that we cannot break the cycle of poverty, sickness and death from starvation that we witness every day. Most of us agree that we have a moral duty to seek ways of managing these humanitarian crises better. We may sometimes disagree on how to do that, although there has been precious little disagreement in this debate.
Those who control the levers of economic and foreign policy—the Governments of the world and the international institutions—are staffed by professional advisers with laudable motives. But to the hungry world, it looks as if there are too many international arrangements, too many bodies with overlapping mandates, and too many duplicated responsibilities—not only in respect of food security but in the whole international apparatus for supporting human needs and development.
That issue is underlined by the partners in the Trade Justice Movement. That remarkable coalition of organisations has organised today's lobby, and we must listen to it. All the organisations have grass-roots, everyday, personal experience of the poverty, sickness and death that are a reality for hundreds of millions of people. Those people are not prosperous, not educated, not secure and not safe. They are certainly not rich enough, nor relaxed enough, to watch the World cup on television and go to the pub to celebrate.
We have listened to the messages of each of those 43 organisations—I think it is 43; the number has been going up in the last week or two—that make up the Trade Justice Movement. Last weekend, I visited every one of their websites. It was a moving and enriching experience. Websites not only allow us to get the message direct, without the need for any press or media; they also reduce the spin. What we get is direct and unvarnished. The internet is a valuable and powerful tool, and we should harness that power, because power is what it is all about. The Trade Justice Movement is about empowering the worst-off in the world. The best-off must realise that it is in everyone's interest to move more quickly than we have done, to alleviate poverty and to combat hunger and starvation among the poorest and most vulnerable people on earth.
Way back in 1996, under the Conservative Government, we agreed at the world food summit that it was intolerable that 800 million people did not have enough food to meet their basic needs. The world community concluded then that this was caused by poverty, conflict, and a lack of water, drains, roads and health care. We agreed to work to halve that number by 2015. It seems now that there is precious little prospect of achieving that goal. What has gone wrong?
International trade has been the great driver of prosperity for 50 years, rising at double the rate of growth of the world economy. International investment is the force pushing forward global investment. Freer trade and foreign investment have enabled parts of south-east Asia to move from developing to developed status in a generation. Poor countries are generally more dependent on trade than rich countries; they receive eight times more each year from trade than they receive in aid. The UN conference on trade and development estimates that, by 2005, developing countries could earn $700 billion more each year from exports if tariff barriers were reduced.
There is no simple way of promoting global economic development. We need to understand why investment flows to some developing countries and not to others. We must identify comparative advantage, create conditions for sustaining investment flows, and condemn corruption, as Tony Worthington said. We must also build markets and support democratic political frameworks that lead to stability and prosperity.
We agree with the Trade Justice Movement that current international trade rules hold back development in poor countries. Those countries cannot compete in the global market while the European Union and the United States subsidise our exports and impose tariffs on our imports. The market is distorted and reform is imperative.
We hope, however, that the partners in the Trade Justice Movement will also listen to some of the gentle messages that we are offering them about accountability and openness. I believe that they are wrong to condemn the general agreement on trade in services. In many countries, water and sewerage infrastructure is sadly a low national spending priority. If private companies can provide or manage a service, where public infrastructure has collapsed or none exists, and if they are willing to invest—perhaps sharing the risk with the Export Credits Guarantee Department, which is currently having yet another review—then it is better that the GATS rules exist.
I believe that the Trade Justice Movement should also be cautious in condemning the activities of international companies. It is demanding
"new global rules to regulate and re-direct the activities of international business".
However, it has no idea who would write the rules or who would police them. The fact is that the multinational companies are already regulated by the national laws of every country in which they operate, and are subject to internationally agreed codes of practice. The evidence is that multinationals operate to a higher standard than most national businesses. They cannot afford to take chances or cut corners. Too much is at stake in their home country, from the Government and from their shareholders alike.
We have had the world food summit of 1996, the Uruguay round, the Monterrey consensus and the Doha development agenda. Earlier, we even had the Torquay round. In Bali, we had the fourth preparatory committee for the world summit on sustainable development, which will take place in Johannesburg from
In this dizzy round of jet set wheeling and dealing, we ask the Government, on behalf of the most vulnerable in the world, and on behalf of all those the length and breadth of the UK who support the motives of the Trade Justice Movement, for action as well as words. We must remember daily so many people in Africa, especially in Zimbabwe and in Sudan, where my brave friend Archbishop Joseph Morona recently risked crossing the military front line in the Nuba mountains in the search for peace and food for his desperate people.
We look forward to the response to this debate by the Under-Secretary of State for International Development. We know that she spent some years as a journalist in South Africa in the 1970s. She will have seen for herself real poverty and desperation in the eyes of children, just as I have in Mozambique, west Africa, Nicaragua and elsewhere.
For goodness sake, the Department of Trade and Industry has eight Ministers. One of them should have been present at this debate, although I concede that they might not know as much about the subject as the Under-Secretary. On Sunday morning last, I listened to the Secretary of State for Trade and Industry being interviewed. She was robust on the need for the EU to phase out export subsidies and to remove import tariffs from the poorest countries. She was firm in her call for African countries to dismantle the trade barriers that they erect between themselves. However, she was hesitant about the time scale, and admitted that the Doha talks would go on for two years. That is too long for millions of the 800 million starving people in the world, for many of whom two more years is a death sentence. Two years and counting: in June 2004, we will expect this Government to give us answers, not epitaphs.
It is a privilege to reply to this debate, which has focused on a major issue of our time that is absolutely crucial to world justice and stability—a fact that is surely reflected in the massive support for world trade reform from the voluntary sector and Church-based groups throughout the country. As my right hon. Friend the Secretary of State said at the outset, such support from a mass movement—including large numbers of young people, as many hon. Friends have said—working with Government constitutes a real watershed.
One in five of the world's population—some 1.2 billion people—live in abject poverty, and we recognise that current levels of sheer deprivation and inequality constitute one of the biggest challenges that we face. The Government have put the eradication of world poverty high on their list of priorities, and we recognise the key role that trade has to play in combating it. Indeed, we have not only recognised, but taken action on, several of the issues that hon. Members have raised, and I shall explain what we have done in due course. However, it will be virtually impossible to deal with all the points that were raised, and I shall of course write to those hon. Members whom I miss out.
My right hon. Friend the Secretary of State set out the history of the thinking on trade and development. Our second White Paper on development makes two key policy commitments: to work with others to reduce poverty systematically, and to promote economic growth that is equitable and environmentally sustainable. This Government have steadily increased our overseas aid budget from the very low levels inherited from the previous Conservative Government, and we are committed to continue increasing it. This Government did not just talk about debt relief—we led the world on it.
No, I have only a few minutes. In addition to debt relief, we have also provided opportunities for trade development for the poorest countries. This Government are also leading the world in seeking to change the rules, so that markets to developing countries will be opened up. In trade as in other areas, the paths of the poorest countries and the rest of the world have diverged in economic terms. For those countries that have seized the opportunity presented by increasingly open world markets to increase exports and attract inward investment, there has been real progress in reducing poverty. However, the poorest have become more marginalised, as my hon. Friend Hugh Bayley rightly pointed out. That is why reducing tariffs, reducing trade barriers between developing and developed countries, and reducing barriers between developing countries themselves, is so important.
A fairer, rules-based system will ensure that developing countries have access to our markets, and that they are not consistently trapped at the low-value, impoverished end of a supply chain that culminates in some of the wealthiest consumer markets in the developed world. Tony Baldry and several other hon. Members raised that issue in relation to commodities, and it is one reason why the change in tariffs is so important. More processing must be introduced in developing countries, so that their produce can be moved higher up the value chain.
This Government have led Europe in pushing for the CAP reform to which Dr. Tonge referred. It was an argument that we had to win, and we did so with some difficulty. I accept that progress might seem glacial, but it must be made through consensus, and the everything but arms agreement and Doha do indeed constitute progress. As Mr. Key said, it is a question not simply of caring, but of taking action. We must care enough to work through the systems, change the rules and produce the improvements that developing countries and the world's poor so greatly need. This Government have consistently done just that by working with Europe, and with world opinion.
My hon. Friend the Member for City of York highlighted the need to embed trade in development policy, and, like several other hon. Members, he underlined some of the issues relating to governance. We need to ensure that financial, justice and land tenure systems are in place to provide the framework for trade, and to help developing countries attract investment. Such systems will ensure that the benefits of trade are recycled into building up the economies of developing countries, and do not simply disappear into foreign bank accounts, or into the back pockets of the elite. That is why my Department does so much work with developing countries on issues of governance, including justice.
My hon. Friend Glenda Jackson was right to pay tribute to the real change in the climate of public opinion here and abroad, and to the role of my right hon. Friend the Secretary of State in achieving that change. She was also right to say that wisdom does not rest entirely on one side of the argument; sometimes, we need to listen a little more to developing countries, and lecture a little less.
My hon. Friend Tony Worthington and Mr. Paice mentioned retaining profits for investment in developing countries, and generating new funds for investment. My Department is working on those issues. For example, the emerging Africa enterprise fund has produced investment funds for major infrastructure projects. Several hon. Members rightly highlighted the change in UK legislation to ensure that companies that bribe people can be prosecuted, even when such offences are committed abroad—a point that deals with some of the issues of governance raised by the hon. Member for Salisbury.
John Barrett and Mr. Lilley mentioned trade reform. The Government welcomed the lobby on trade reform, and we worked with the non-governmental organisations and countries involved. The hon. Member for South-East Cambridgeshire highlighted some of the problems associated with agriculture, and I have already dealt with commodities and the process involved, and with land ownership systems. Of course, we recognise that 70 per cent. of the world's poor live in rural areas, and that agricultural issues are therefore central to dealing with world poverty and other millennium development goals.
My hon. Friend Mr. Lyons said that we must ensure that we do not just talk and then forget, and I can assure him that this Government certainly will not forget about the world's poor. We are working with the NGOs that are leading this campaign, and we will continue to do so. We are working with the American Government, European Governments and—importantly—developing countries to secure the necessary changes. Developing countries need not just handouts today to feed the poor, but a hand up to ensure sustainable development that will produce lasting changes.
The linkages between trade, development and poverty reduction are important to us all, but they are absolutely crucial to the poorest countries—a point recognised by the trade lobby and by the Government. There are three key factors to achieving our goals.
The first factor is a clear commitment across Government to the eradication of world poverty. The whole Government have signed up to that.
The second factor is a clear commitment across the international community to make sure that developing countries are able to participate in world trade. As so many have recognised, we have a long way to go with that, but this country is leading the world. The third factor is massive public support.
Question put, That the original words stand part of the Question:—
Order. That is not a matter on which the Chair can rule. I would say only that the longer one stays here, the more it appears that anything is possible.
Question accordingly negatived.
Question, That the proposed words be there added, put forthwith, pursuant to
Mr. Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.
That this House welcomes the lobby of Parliament by the Trade Justice Movement and increased recognition of trade as a key component to reducing global poverty; welcomes also efforts made to draw public attention to these important issues; recognises trade has an important role to play in helping countries achieve the Millennium Development Goals (MDGs); is aware that to achieve this a multilateral trading system is needed giving developing countries a fair deal; recognises that the Government is committed to working with developing country partners, and other bilateral donors and multilateral organisations to achieve this; believes that the development challenges faced in Africa require the international community, working together with African countries, to make additional efforts to secure progress towards the MDGs; welcomes the Government's commitment to turning the agreement reached at Doha in November last year into a meaningful 'Development Round' and to achieving real progress on market access and in areas of importance to developing countries; will continue to support efforts to reform the Common Agricultural Policy and reduce trade-distorting subsidies; will support preferential access to developing countries through the Generalised System of Preferences aid to least developed countries through the Everything But Arms initiative; recognises developing countries themselves must undertake effective policy measures to integrate into the global trading system; supports these efforts and engagement in a broad range of activities to help countries participate more effectively in the multilateral trading system; and further welcomes the Government's commitment to doubling support for trade-related capacity building from £15 million in 1998–2001 to £30 million in 2001–04.