Foreign Policy — Debate (Continued)

– in the House of Lords at 2:59 pm on 26th February 2009.

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Photo of Lord Blaker Lord Blaker Conservative 2:59 pm, 26th February 2009

My Lords, I start by congratulating two people, one of whom was here a moment ago. I wanted to congratulate the noble Lord, Lord Marlesford, on choosing a topic for debate that has turned out to produce an excellent debate, which we still have not finished. I congratulate noble Lords still planning to speak on staying in the Chamber. The other person whom I wanted to congratulate is the noble Lord, Lord Hurd, who made remarks on the future of the Foreign Office and the Department for International Development with which I wholly agree and which I hope he will push further.

It will not surprise noble Lords that I want to speak on Zimbabwe. It is far from clear whether the present transitional Government in that country will provide a workable basis on which to move forward from the current multiple crises of governance, human rights, disease and economic collapse. Mugabe is rejoicing in the fact that the situation is very complicated and gives him every opportunity to use his devious skills. The situation has also become sufficiently important for the most reverend Primates the Archbishops of York and Canterbury to enter the debate by urging people to pray for the future of Zimbabwe.

I welcome the appointments of Morgan Tsvangirai as Prime Minister and of his MDC colleagues to ministerial office but, so far, all the signs are that their position seems to be best described by the phrase "in office but not in power". It has long been clear that real power in Zimbabwe is in the hands of the JOC, the Joint Operations Command. This is the junta comprising the chiefs of the army, air force, police, prisons and intelligence—five posts. Those are the people who really count. This is the junta that is effectively in control of the country. They continue to use abduction, beatings, arrest and detention as a means of intimidation and control. Corruption is rife and they use their power arbitrarily to seize property and other assets to accumulate wealth and power. Gideon Gono, the governor of the Reserve Bank, acts as their ally and banker.

An African diplomat was recently quoted as saying:

"The JOC is the real enemy of democracy. It obeys no laws and wants to send the signal that the MDC should not think that being in government offers it any sort of protection".

It is significant that every member of this five-man cabal boycotted the swearing-in ceremonies for Tsvangirai and his new Ministers. They simply stayed away. Once its aim was to destroy the MDC as a political movement; now it is intent on bringing a swift end to Prime Minister Tsvangirai's power-sharing Government, or at least keeping it on a tight rein for as long as it can serve a useful purpose of window-dressing the regime to the world.

Ironically, the body that ought to be monitoring and reporting back to SADC and the African Union on these breaches of the Global Political Agreement, which is the basis of this activity, is struggling to hold meetings because of a lack of money. JOMIC, the Joint Monitoring and Implementation Committee, was set up in January by SADC as a crucial element in the global agreement. Its role is defined as being,

"to ensure the implementation, in letter and spirit, of the Global Political Agreement", to ensure "full implementation", to act as a conduit for complaints and to promote,

"an atmosphere of mutual trust and understanding between the parties".

JOMIC is supposed to be guaranteed by both SADC and the AU, yet Elton Mangoma, its co-chairman, says that it is barely able to function through lack of funds. That is one of the key organisations that is meant to hold the reins. It has no permanent office to hold meetings, no administrative staff and three of its 12 members have difficulty in attending meetings since not even their travel expenses can be covered.

It is worrying that South Africa's foreign affairs spokesman is blithely able to announce that JOMIC is "up and running". This is an organisation that has no staff and practically no money. There seems to be a very dangerous complacency over much of the region that, now that the agreement has been signed and the swearing-in has taken place, they can sit back. Nothing could be further from the truth. What is needed is continuing and robust engagement.

Mugabe has been driving a coach and horses through what was supposed to be a finely balanced and delicate concord between the parties. Months of careful and painful negotiation have been set aside and overridden by Mugabe appointing more Zanu-PF Ministers—that is, Ministers from his own party—than he was entitled to. This week he has ridden roughshod over the agreement again by unilaterally appointing permanent secretaries to the 31 ministries. That means 31 new permanent secretaries. Anything more ridiculous one cannot imagine.

In response, Prime Minister Tsvangirai stated:

"Yesterday's announcement of the appointment of Permanent Secretaries is in contravention of both the Global Political Agreement and the Constitution of Zimbabwe which is very clear with regard to Senior Government Appointments".

Article 20.1.7 of the eighth schedule of the GPA states:

"The Parties agree that with respect to occupants of senior Government Positions, such as Permanent Secretaries and Ambassadors, the leadership in Government, comprising the President, the Vice-Presidents, the Prime Minister and Deputy Prime Ministers, will consult and agree on such prior to their appointment".

He also quoted the SADC communiqué issued in Pretoria on 27 January, which states that,

"the appointments of the Reserve Bank Governor and the Attorney General will be dealt with by the Inclusive Government after its formation".

I know that the Minister for Africa has maintained a close and detailed watch over all these issues. He is committed, as we all are, to the welfare of the people of Zimbabwe and the economic development of the region. It is vital that the EU-targeted measures against those who have brought death and destruction to Zimbabwe remain firmly in place. The very fact that Zanu-PF and its apologists in Africa call so vehemently for their repeal demonstrates that they are effective, particularly the hindrance to global gallivanting imposed by the prohibition on travel through the hub airports of Europe.

The UK has provided massive humanitarian support over recent years. I am sure that this is appreciated by the vast majority of the people of Zimbabwe, even though it is treated with contempt by the Zanu-PF elite, who simply see it as another source of hard currency that they can raid. While I accept that this aid will have to continue simply to relieve suffering and save lives, I hope that so far as possible it will be channelled via agencies well protected from the greedy clutch of the Reserve Bank governor, Gideon Gono. I also hope that together with our EU partners we will be strict in releasing other funding only once it is clear from evidence on the ground that the very basic benchmarks of rule of law are observed, including press freedom and respect for human rights, as reiterated recently by the Foreign Secretary.

Regional leaders must unequivocally support Prime Minister Tsvangirai's brave efforts to prove that a peaceful transition to democracy, good governance and economic stability is possible. Much more support should be forthcoming from members of SADC. For the second time in 30 years, Zimbabwe is a test case for democracy in southern Africa. The credibility of SADC and the AU are at stake. So are the lives of thousands of Zimbabweans.

Photo of Lord Ramsbotham Lord Ramsbotham Crossbench 3:08 pm, 26th February 2009

My Lords, I join all those who have congratulated the noble Lord, Lord Marlesford, on obtaining this debate, on his masterly and tone-setting opening speech and on including the word "challenge" in the title, which has allowed so many subjects to be considered in a debate in which, as my noble friend Lord Wright rightly said, it is a privilege to take part.

As a fellow member of the Rifles, I join my noble and gallant friend Lord Bramall and the noble Lord, Lord King, in expressing condolences to the families of the three members of the regiment who lost their lives yesterday in Afghanistan.

I should like to cover two totally different subjects: Trident and prisoners. I was flattered that both the noble Lord, Lord Marlesford, and the noble and learned Lord, Lord Howe, should quote from a letter that my noble and gallant friend Lord Bramall, General Sir Hugh Beach and I wrote to the Times earlier in the year on the subject of Trident replacement. We did that not to try to suggest precipitate unilateral disarmament but rather to encourage a debate about whether this weapon system, and the capability that it represents, is a vital part of securing national self-defence, or whether there is an alternative. Four questions have to be answered if that debate is to be held. While taking part in a debate on the World Service, I was disturbed to be told by a senior Member of the other place that such a debate was unnecessary because a vote in the House of Commons had already decreed that Trident should be replaced. I told that Member that that was not the point, as many wider issues had to be considered.

Is Trident independent? The answer is strictly no, because the D-11 missile belongs to the United States. I have always thought it unthinkable that we should consider launching the Trident system without the backing and support of the United States. What is its current utility? Can we really see a weapon of this magnitude being used in wars or in an anti-terrorist situation? That is not to say, of course, that we do not have to consider threats that we cannot predict at the moment. It used to be said that possession of this weapon guaranteed you a seat at the top table. I do not believe that that applies anymore, because the place at the top table is now much more related to economics than to possession of a strategic nuclear deterrent.

My final point—there are others—concerns affordability. There are two definitions of "affordability": can you afford it or can you afford to give up what you have to give up in order to afford it? As many noble Lords have said, the fact that our conventional arsenal is not equipped with all that we need to carry out what we have to do must raise questions about whether the cost of Trident is affordable in terms of what we cannot have because of it. The climate is right for such a debate. First, Trident has a limited shelf life. Secondly, President Obama has already announced where he is heading in this direction. An Australian-Japanese commission is examining the whole subject of multilateral disarmament. SALT and the nuclear proliferation treaties are coming up for renewal. Therefore, it seems to me that we would be wise to have a proper debate on this to make certain that all those taking part in the discussions are equipped with the relevant information.

On costs, the letter that we wrote states that our independent deterrent has become virtually irrelevant except in the context of domestic politics. In that context, I wonder therefore whether the time has come to remove it from the defence budget so that it is no longer weighed against conventional forces in the examination of that budget, and either put into another budget, such as the Foreign Office's, or ring-fenced within the Ministry of Defence budget so that it is no longer an either/or with our required conventional force.

On my second subject, the Foreign Office is closely connected with two groups of prisoners. One group comprises foreign national prisoners in prison in this country. Fourteen per cent of our current prison population comprises people from foreign countries; that is, 10,300 men and 960 women. They come from 160 nations. However, half of them come from 10 countries, which seem to be the main offenders, as it were. Most are involved with drugs. Four out of 10 men and eight out of 10 women in prison are there for drugs offences. Six out of the 10 are sentenced to more than four expensive years. One-fifth of all the women in prison are foreign nationals.

In addition to that vast number of prison spaces being taken up by foreign nationals, the Prison Service requires 1,100 beds in our immigration hostels. A further 400 to 500 detainees are held in prisons while their deportation is processed after their sentence has been completed. I question whether the Foreign Office could not do more to help in this situation because, in a large number of cases, the deportation of foreign national criminals is written into the sentence.

Slightly different rules apply to people coming from non-European countries. A non-European is given automatic deportation after a one-year sentence or an aggregation of a one-year sentence. If he commits a drug or gun offence, he is automatically deported, or the court can recommend deportation. If deportation is recommended by the court, why does that not occur so that, at the end of the sentence, the prisoner does not go to a detention centre, where they cause problems because they are not immigration detainees? Why are they not processed so that they go straight from prison to the airport and are then deported? One of the reasons is inefficient bureaucracy within the Prison Service. That is not a matter for the Foreign Office. However, what is a matter for the Foreign Office, which I believe should be pursued with greater vigour, is obtaining the deportation and the travel documents, sorting out all the international complications and making certain that the prisoner is deported. We have agreements on unilateral deportation with 69 countries. A European framework document will be issued in 2011, which will make deportation happen automatically for European national prisoners.

I draw the following fact to the attention of the Foreign Office. Quite apart from the fact that prison is extremely expensive, it will not do its job of protecting the public unless it includes a period of resettlement to prepare people to live a useful and law-abiding life in their own country. Why, then, should not the Foreign Office make certain that our prisoners abroad are brought back in time to be resettled in this country before they go back to their community instead of arriving at the airport after their sentence with nothing—no benefits, no clothing, nothing? Without a charity called Prisoners Abroad, there they would be. Urgency by the Foreign Office could improve this. Similarly, urgency is needed to resettle foreign prisoners back in their own countries, rather than using up vast amounts of our money taking part—or not taking part—in programmes that have nothing to do with them, because they are not going to be resettled in this country.

This is a challenge to the Foreign Office to which speed should be given, due to the fact that we have a hugely overcrowded and vastly expensive prison system in this country. If 14 per cent of prisoners could reduce the contribution to that, I recommend that the Foreign Office at least do something to help.

Photo of Lord Joffe Lord Joffe Labour 3:18 pm, 26th February 2009

My Lords, I join in thanking the noble Lord, Lord Marlesford, for introducing this debate. I have listened with respect to the vast experience and views of the noble Lords, Lord Hurd and Lord Wright, on the conflicting foreign policies of the Foreign Office and DfID. I am not competent to express a view on that. However, addressing poverty in the developing world is a key part of our foreign policy. I declare a interest as an ex-chair of Oxfam and I am indebted to it for a briefing for this debate.

The poor of the world are fortunate that our Prime Minister, who has led the way in the attack on poverty in the developing world, is also taking the lead in the forthcoming London G20 summit to broker a new global deal which will, I hope, benefit the developed and the developing worlds. I shall focus on what I believe the developing world hopes will emerge from the summit, which faces the challenge of responding to what is probably the world's most serious economic crisis since the 1930s.

There is a real danger that the significant gains made towards meeting the millennium goals by many developing countries could be wiped out as financial flows dry up and, as usual, the most vulnerable will be most at risk. The severity of the crisis means that Governments around the world, led by the United Nations and the G20, need to act together to address it.

In relation to the developing world, there are four key areas upon which the G20 should focus. These are delivering a rescue package for developing countries, tackling climate change, regulating finance to ensure stability and reforming global governance. These areas overlap to a certain extent with what is required by the G20 countries for their own economies.

I shall briefly touch on each of these areas, beginning with a rescue package. It is hoped that a fiscal stimulus and resource for developing countries should be set up as soon as possible through the World Bank and the IMF, and it should be available on concessional terms, delivered as budget support and be free from conditionality. Rich countries must also increase their aid levels to reach the agreed target of 0.7 per cent of GDP, and debt cancellation must be actively pursued. Naturally, this will require significant additional funding, and it is important that it should not be taken out of existing ODA budgets, otherwise there will be no net benefit.

In relation to climate change, without urgent action to curb greenhouse gas emissions, developing countries such as Bangladesh will be at great risk. It is hoped that the G20 rich countries will commit to delivering a fair share of adaptation finance to developing countries to help them avoid the worst impacts of climate change.

In relation to finance and ensuring stability, the G20 must ensure that the world financial system is under greater public control and is more transparent and accountable. Tax havens, to which much of the wealth of the developing world is illicitly channelled, must be tackled. Measures should also be taken to curb volatility and speculation in financial markets, particularly exchange rate markets.

Finally, there is a need to reform global governance. The crisis offers an opportunity to make the international system fit for the 21st century. This means having not only better regulation of financial flows, but more equitable governance and oversight at the international level, including the G20. The G20 includes the major developing economies, but excludes the least developed of them. It should be more inclusive and bring in broader representation. It was encouraging to learn, in the eloquent speech from the noble Baroness, Lady Amos, that NePAD and the African Union have been offered invitations to attend the London G20 summit. I hope that will continue in future.

The London summit is an opportunity to mark an historic break with the failed system of unfettered capitalism, and the start of a new system that seeks to make the market work for the benefit of all people and for our planet. The challenge is for our Government, led by the Prime Minister, to help make that happen.

Photo of Baroness Hooper Baroness Hooper Deputy Chairman of Committees, Deputy Speaker (Lords) 3:25 pm, 26th February 2009

My Lords, it feels quite like old times to be having a five-hour state-of-the-nation debate in your Lordships' House on a subject of extreme importance to our nation and to the whole world. I therefore add my thanks and congratulations to my noble friend Lord Marlesford on securing time for this debate, on his brilliant introduction and, indeed, on his timing. It is important, as the noble Lord, Lord McNally, reminded us earlier, that Conservative thinking and priorities on foreign policy are fully understood.

Given the generous terms of the Motion, it is tempting to cover a lot of ground and touch on challenges such as the updating for the 21st century of our post-1945 global institutions, which the debate has not yet touched on. I refer to the changing role of the Council of Europe, with its 46 member states including Russia and Turkey—for 10 fascinating years, I served as a Member of the Parliamentary Assembly of the Council of Europe—and to the European Union, especially in this year of European parliamentary elections. There is also the challenge and excitement, in the United States, of what my noble friend described as the new wave of the Obama presidency.

However, as many of your Lordships will not be surprised to hear, I intend in my allotted time to concentrate on two themes that are, I believe, all too often lost and forgotten in the drama and turbulence of the Middle East and in considering the overwhelming size and dynamism of growing economies such as India and China. I speak, first, of the rich and varied region of Latin America and, secondly, of the Commonwealth—an organisation of great importance to this country, and which I greatly admire.

In all this, I wish to reiterate what has been said, today and on other occasions in your Lordships' House, about the importance of the role of the Foreign Office and of agencies such as the British Council—on which subject, I am disappointed that the noble Lord, Lord Kinnock, was not able to participate in this debate. I lament, once again, the closing and downsizing of embassies, high commissions and representative agencies, both in Latin America and in Commonwealth countries. My noble friend Lord Hurd has emphasised that, while I also lament the reduction in educational exchanges and scholarships that have traditionally played such an important role in our international relations and goodwill from countries worldwide.

I must mention how magnificent a job the British branches of the Inter-Parliamentary Union and the Commonwealth Parliamentary Association do to fill the gap, as do many NGOs. I cite, for example, the English Speaking Union, but we must not forget the roles of Canning House, our Latin American organisation, and, indeed, of Chatham House. They deserve and need support, which I hope will be stepped up by a future Conservative Government. The noble Baroness, Lady Gibson, set the scene on Latin America in her role as chairman of the all-party group. She gave us facts and figures to underline the region's importance, and posed a number of questions that need answers. No doubt, the noble Viscount, Lord Montgomery, will also talk from his wide experience and knowledge of the region.

The individual countries that together constitute what we, for convenience, refer to as Latin America play a vital part not only in the world economy but in other world aspects. They are rich in commodities, not only oil and gas but water and precious metals, and in food production. In the vital area of climate change, Amazonia is recognised and often described as the lungs of the world, and Brazil is a world leader in developing energy from sugar, one of the most efficient forms of alternative energy. China recognises that and is investing heavily in the region, replacing British investors in some cases. While we currently give priority to developing trade with China, as every other country in the world seems to be doing, China is replacing our investment and interest in Latin America.

The European Union also recognises the importance of Latin America and has negotiated and continues to negotiate trade agreements with the region and with individual countries within it. In my day as president of Canning House, the Hispanic and Luso Brazilian Council, my aim was to build bridges between the European Union and Latin America. I saw one bridge going, obviously, from Spain and Portugal, from the south of Europe, and the other going from the north of Europe from the United Kingdom. Our historic and traditional links with individual countries through their independence movements, led by Bolivar, San Martín and O'Higgins, and our history of trade and investment in that region, have created an enormous amount of good will.

To illustrate our neglect of Latin America, as a trustee of the Industry in Parliament Trust, I recently intended a seminar entitled "Global Markets: A Look Forward". The chairman of UK Trade and Investment's Financial Services Sector Advisory Board talked about its priority markets being the BRICs. He went on to talk about China, Russia, India and Singapore. The "B" of the BRICs acronym stands for Brazil, so I asked why Brazil, with its leading role in Latin America, its membership of the OECD, and so on, was not treated as a priority area. He answered that I would be glad to hear that it had indeed been a runner-up and almost included within the priority area.

UK banks used to be household names throughout Latin America; now we probably see only HSBC there. Surely the balance needs redressing. For that matter, Mexico also has a huge and thriving economy and a Mexican is currently running the OECD. I very much welcome the state visit of the President of Mexico, which will help to call attention to the importance of that country. I hope that the Minister will be able to reassure us that in future, UK Trade and Investment priorities will include more than one country in Latin America.

In the few moments that remain to me, I shall dwell on the Commonwealth. It is appropriate during the 60th anniversary year of the foundation of the Commonwealth to review an institution that has changed and developed over the years and now has countries with no historic or colonial links queuing up for membership. It includes and gives democratic voice to 53 countries large and small, including all the major faiths and spanning five continents and three oceans. Its importance was underlined recently by my right honourable friend William Hague—here I may help the noble Lord, Lord McNally, with his lack of confidence in him as a future Foreign Secretary. In a major speech my right honourable friend said:

"The theme of my speech is the need to think afresh about Britain's relationship with the Commonwealth and to join with people from other nations in reinvigorating this extraordinary organisation. It is a relationship which has endured through the ages but sadly has been undervalued in recent years".

That is the right approach and a good indication of Conservative policy for the future.

It interesting to note the success of our Commonwealth at reinforcing the Francophone countries and the Spanish and Portuguese-speaking countries in creating and strengthening their links, both commercial and cultural, between peoples united by history and language. The example of the CPA in bringing parliamentarians together on that basis is also being followed. Maximum support is necessary from our Government to ensure that this unique institution moves forward and takes a lead in global policies.

My final phrase will be: in facing new challenges, we must not forget old friends.

Photo of Lord Weidenfeld Lord Weidenfeld Crossbench 3:35 pm, 26th February 2009

My Lords, the predominant aim for a British foreign policy that can cope with political challenges, acute or simmering, and steer us through the floods of a global economic crisis in which there will probably be few Noah's Arks, must be a reinvigoration of our European policy and its harmonisation with renewed transatlantic ties. If your Lordships were to join me in looking further into the 21st century, you might share my view that such a broad alliance would be greatly strengthened by an additional dimension—that is, the inclusion of Russia. What should drive the nations living between Vancouver and Vladivostok together? It is, first, the ticking demographic time-bomb; the decline of population in Russia, but also in many European countries. By the middle of the century, Russia's 170 million of today may shrink to 120 million. In Europe's most populated state, Germany, the maternity wards are half empty; today's 85 million is likely to dwindle to 60 million. International terrorism and Islamic extremism also menace most of those countries. On the other hand, harmonious collaboration across the Atlantic, and including Russia, would make it easier to obtain equilibrium and a peaceful working relationship with China and the other giants of the East, rather than playing them off, one against the other.

I am well aware that our relations with Russia are now at a low ebb, and it is not likely that one or the other party will beat its breast in remorse. But realistic reasoning does not mean appeasing. Reasoning does not mean appeasing. Those who go so far as to think that the present Russian regime has acted shamefully can be answered that the whole of the West gravely injured Russia's self-esteem after she rid herself of communism. Our media predicted early economic collapse, disintegration and the secession of major provinces led by powerful warlords. Western statesmen shook their fists in Kiev, denying Russia's special rights in the Crimea. Our backing of Georgia, doubtlessly inspired by humanist impulses, ignored the fact that the Government in Tblisi did not always handle their great neighbour judiciously and that the small Caucasian enclaves were yearning for freedom.

Expanding the European Union further east, especially in the light of the fierce struggles to agree on the inner workings of the present 27-member Union, raises mighty problems. We should not allow ourselves to come to quick conclusions on, say, the Ukraine, when many of us have come to regret that we were perhaps prematurely sponsoring Turkey's entry some 20 years ago. I have recently been in the western Ukraine and, as a born Austrian, I felt the western, indeed Hapsburg, legacy in those places. At the same time, east Ukrainian friends still dream of the great moments in Russian history connected with Kiev, Odessa or Sebastopol. Of course, there is a modern, solid, vibrant Ukrainian nationalism, but if relations between the wider West and Russia were to develop along dynamically progressive lines, the phrase "partnership for peace", so popular in the early days of the Gorbachev and Yeltsin regimes in reference to NATO and the Russian armed forces, would become a reality and Ukraine, Belarus, Moldova and others in the "near-abroad" sphere might find that their security was no longer at risk.

All nations of the wider Middle East, rich or needy, armed or practically defenceless, are now nervously trying to guess whether the superpower America under President Obama will be on the retreat into semi-isolation. Will America pursue the war on terror with the necessary vigour? Will America succeed in negotiating with allies, friends, fence-sitters and foes, or only waste precious time? Will contact with Iran, now that Teheran seems far nearer than expected to within sight of its first atomic bomb, lead to a successful compromise? If it does not, what will Obama do?

There now seems to be a flurry among Middle Eastern regimes to seek shelter in a world in which the United States no longer plays the dominating role. They look for assurances elsewhere—to China, some to Russia—yet others seek to come to terms with terrorist organisations, upgrading them to valid interlocutors. Hostility to Israel is a safe posture in the quest for sympathy.

Was the outburst by President Erdogan of Turkey at Davos, when storming from his shared platform with Shimon Peres, spontaneous or rehearsed? Will Turkey, hitherto a bastion of NATO loyalty and strategic partner with Israel, swap horses? One may well ask: would a Turkey of, say, 100 million people within 15 or 20 years carry the torch of western standards to Europe's new borders with Georgia, Armenia, Azerbaijan, Iran, Iraq and Syria, or would it turn into a Trojan horse, unloading a baggage of bigotry and intolerance?

The more one considers the endless variations of the peace endeavours in the Palestinian/Israeli conflict, the more one feels that only a holistic approach can have positive results. What use would be an Israeli/Palestinian treaty which, before the ink was dry, was rendered ineffective by Iranian arms reaching, via Syria, Hezbollah in Lebanon on Israel's northern borders and Hamas in Gaza? In my view, only powerful international intervention would impress all parties and could deal effectively with the interlinking issues of that troubled area.

America's new high-level talks in the region will have to convince the seasoned observer that a real breakthrough can be achieved by peaceful means. If it can, soft diplomacy will have brought us much solace as we grapple with our economic doldrums. If it cannot, will the wider West risk nuclear proliferation, anarchy, moral nihilism, state and non-state terrorism or will it, however reluctantly and only as a very last resort, follow a call to arms?

Photo of Baroness Falkner of Margravine Baroness Falkner of Margravine Liberal Democrat 3:42 pm, 26th February 2009

My Lords, I, too, thank the noble Lord, Lord Marlesford, for securing this debate and, indeed, for so elegantly and succinctly covering an expansive ground of challenges today.

I want to talk about a single challenge, albeit an increasingly serious one: the question of what the West can do about Pakistan. It is an ongoing challenge in the sense that Pakistan's potential to destabilise the region continues, as the noble Lord, Lord King, and others pointed out, but it is also a growing challenge for us here in the UK, for the US and for NATO, as the outcome of what we can do in Afghanistan is predicated on what we are able to achieve in Pakistan. Furthermore, what happens in Pakistan is now inexorably tied up with debates in the wider Muslim world about justice for the people of Kashmir, which has taken its place alongside the challenge of seeking a peaceful solution to the Israel/Palestine problem.

These debates impact on us in the domestic sphere here in Britain too, as both conflicts have an ability, at best, to engage British Muslims in our foreign policy decisions or, looking at the darker scenario, to radicalise British Muslims. What is clear is that foreign policy challenges are no longer the preserve of the initiated in forums such as this Chamber or the world of think-tankers and opinion-writers. We heard earlier of the need for a serious explanation by the Government to the British people of the limitations of Britain's role, not in any sense in "talking it down" but more in educational terms of how we are constrained by external factors and actors, and how we can no longer act on the will of the people in the international arena as we might have done 100 years ago.

So where are we in Pakistan? Sixty years on from a messy partition from India, and after several attempts at military and civilian Governments, this country of 165 million is still incredibly poor. GDP per capita, based on purchasing power parity, is still under $2,500, and all the indicators of human development, basic health and education give no cause for optimism. The figure of per capita GDP is important. There is now consensus that transitions to democracy are unlikely to succeed in countries where GDP per capita is under around $7,000 per year. This is simply because institutional development and governance in those situations is so weak, and therefore human development is constrained, that democratic choice becomes challenging to deliver.

Last week, 18 February saw a full year since democratic government was restored in Pakistan. It is ironic that this anniversary was marked by the virtual ceding of a critical region of Pakistan in one of its most volatile provinces, the North West Frontier Province, to the Taliban. It is an area where, in last year's election, the people overwhelmingly voted for the Awami National Party, which is a secular party far removed from Islamic militancy. It is testimony to the weakness of the democratic mandate that the Government of Pakistan have so easily succumbed to the terrorist threat. I use the word "terrorism" with care. It is indeed terrorism that the people of Swat have endured, with public beheadings of their friends and neighbours, and public beatings for those who do not subscribe to the antediluvian and medieval code that the Taliban impose. The deal itself is done by terrorists named by the Pakistan Government as the murderers of Benazir Bhutto.

The danger of the Talibanisation of Pakistan does not end in the NWFP. Only a few weeks ago the Financial Times reported that the mayor of Karachi, who runs Pakistan's most liberal commercial centre of 15 million people, has spoken of his fear that the Taliban are taking over and destabilising his city. Last month nearly 20 people died in gun battles between people from the NWFP and local residents of Karachi. Lest noble Lords think that these are isolated instances, they will also recall that Lashkar-e-Taiba, the group behind the Mumbai bombings, is based in the Punjab. Last year alone saw 60 terrorist attacks in Pakistan. Those who hope that the Pakistani Taliban can be contained in fractious feudal outposts need to wake up to the sad fact that terrorism is endemic throughout Pakistan, and is increasingly destabilising the already weak governance structures.

Furthermore, this region of south Asia is one where we have repeatedly heard the drums of war, even in the last decade. The stand-off between India and Pakistan over the Siachen glacier in 1999 led to a near-conflagration and has seen the longest land-mined border in the world, extending over 1,000 miles. Last December's Mumbai attacks resulted in sufficiently belligerent tones between the two countries for several Army divisions to be moved from Pakistan's western frontier, where they had been countering al-Qaeda, to its eastern border with India. The stakes in a future war with nuclear options would be disastrous not only for the region, but the world.

What are we to do? The answer mainly lies in Washington, but it impacts on us here in London, too. Several of the pointers are fairly obvious. It seems evident that our tenure in Afghanistan will be for the long term, until that country becomes a relatively stable democracy, with a Government who are capable of enforcing law and order throughout their territory and maintaining peace and security for their citizens. My view is that this cannot be a Taliban Government. It must be democratically elected, even if this might be a hybrid of local customs and institutions alongside a popular mandate. The commitment of a further 17,000 troops from the US is a welcome development and I hope that the UK will rise to the challenge of augmenting our own force numbers there. In time, it will also be necessary to revisit the border between Afghanistan and Pakistan, and seek a solution to the Durand line dispute. It is only when both countries take responsibility for rooting out cross-border insurgency that sustained good relations between them will become possible.

In terms of Washington's role in the region, I take the point made by several noble Lords that the Obama Administration may well find themselves preoccupied with the economic crisis, but we should be assured by the fact that some of the finest US minds have been brought to bear in the White House policy review on Afghanistan and Pakistan that is currently under way. Ambassador Holbrook brings both wisdom and experience to his diplomacy in the region, while the appointment of Bruce Riedel as chair of the review is extremely good news, as he will bring his background in the CIA, the Pentagon and the National Security Council to bear on what he describes as a situation which is "dim and dismal".

While there is a recognition in the US of how dire the situation is in Pakistan and Afghanistan, I fear there is little original thinking in the Foreign Office of what we are to do or, indeed, of the urgency of the situation. At a modest level, we need to recognise that stability in Pakistan and Afghanistan is predicated on assistance with development. I share the view of several other noble Lords that the separation of DfID from the FCO has resulted in our losing strategic depth in prioritising our interests. Aid to Pakistan is now so low as to have little traction. A few months ago we were told that it was going up by £150 million a year in the 2008-11 settlement, an increase from a low base that works out at roughly £1 per year per capita for a county the size of Pakistan. We also need to improve the capability of Pakistan's military and security structures to deal with counter-insurgency. If this means providing training in arms to an army originally designed to fight a well mobilised Indian force in order that they might change their mindset to deal with insurgents and terrorists on horseback emerging from narrow alleys, then that is what we should be doing.

Finally, we need to scale up our attempts through multilateral diplomacy to find a solution to the India/Pakistan problem pace Kashmir. It is with regret that Richard Holbrook's remit was curtailed from being a regional one that included India and Kashmir to a more limited one under pressure from India which seeks to prevent internationalising the issue. It is evident to any analyst dealing with south Asia that the Pakistani mindset is still one which, wrongly, is preoccupied with India as the sole enemy and one capable of an existential threat to Pakistan. We cannot change this mindset, which is prevalent in the security services, the military and, indeed, in aspects of the media, until we recognise Kashmir as a dispute that must be solved and then engage with both partners in the region and more widely in seeking a peaceful and durable outcome.

Photo of Lord Hylton Lord Hylton Crossbench 3:53 pm, 26th February 2009

My Lords, I am sorry that I cannot follow the theme pursued by the noble Baroness, Lady Falkner, because I would like to examine the challenges to our foreign policy arising from the Middle East. I start from the conviction that western policy has been a signal and very expensive failure since at least the time of the Oslo agreements. The failures have perhaps been largely American ones, but Britain has been dragged along in the wake, despite the high quality of our diplomats.

In the early 1990s, Oslo seemed like a miracle, but now we can appreciate that it was somewhat unjust and simply postponed the most important issues. The West failed to foresee two appalling wars, in south Lebanon in 2006 and the most recent onslaught on Gaza, which followed a blockade going back to 2005. More comprehensive dialogues might have prevented both wars. These wars have left Israel still insecure while alienating Hamas and much of Islamic public opinion throughout the world. Western policy could be greatly improved by not laying down preconditions. These are usually inappropriate when those affected have suffered the traumas of war, displacement and occupation. The preconditions imposed on Hamas after its election victory in 2006 were perhaps the most glaring example of this kind. My noble friend Lord Wright has already mentioned the excellent letter in today's Times, which I just hope will lead to major changes of policy.

The other improvement in western policy would be not to demonise groups and Governments of whom we may disapprove. Iran has had a bad human rights record, both under the Shah and since his fall. The current president has, however, been elected and his Government are in full control of their territory. If I were Iranian, I would see nuclear weapons to the west, the east and the north of my country and ask, "Why can we not also have them?". What is surely needed is less western rhetoric coupled with consistent, patient negotiations.

Are the Government studying the report from the Strategic Foresight Group, The Cost of Conflict in the Middle East? I mentioned this in our debate on 6 February and so far have had no reply. On the same day, I regretted the lack of multilateral approaches to peace and stability in the Middle East since the Madrid conference now 18 years ago, and here I agree with my noble friend Lord Weidenfeld. It is shameful that the constructive proposals of the Arab League have been so neglected since they appeared as long ago as 2002. We now urgently need to repair the harm done by attention being diverted to wars in Afghanistan and Iraq.

States both within and outside the Middle East should try to view the region as a whole. Like the Baker-Hamilton commission advising former President Bush, we should all be asking how maximum regional co-operation can be generated and what the most appropriate new or existing institutions are that could work for the common good of the whole region. Permanent fora are needed where common problems can be discussed. This is all the more necessary given the arbitrary lines drawn by existing frontiers. Discussion of common problems could lead the way to the co-ordination of policies and eventually to varying degrees of pooling of sovereignty. Perhaps the Middle East needs its own regional version of the OECD. It may be inappropriate to speak of a Marshall plan for the Middle East, but ways should surely be found to bring together the resources and sovereign wealth funds of the oil and gas producers with the technology and know-how of western business. The aim should be to create an area of common prosperity and improved education for the mainly young populations of the region. It is worth noting that these young people are often football crazy. British teams at all levels could win friends and influence people by playing matches in the Middle East.

When a region is anxiously searching for peace and normal life, "reconciliation" can be an overworked and sometimes empty word, but it is a time-consuming and costly process and one in which civil society has a vital role to play. Religious leaders, parliamentarians, business people and NGOs all have a common interest in working for reconciliation on two levels. There is the regional level, already mentioned, aiming to create a wide area of common prosperity, and there is the level of the state or nation. There is an obvious need for a coming together among Palestinians between the secular and Islamic parties and between both and their diaspora. Even in Israel there are tensions between Ashkenazis and Sephardim or between Arab and Jewish Israelis. Both Iraq and Lebanon have three-way splits between religious and cultural groups. In Egypt and Turkey, majorities and minorities do not find it easy to co-exist in harmony.

British foreign policy should be humble enough to recognise the mistakes and failures of recent years. It should also be cognisant of the reconciliation needs that I have cited. It should support national and regional reconciliation wherever this is discreetly possible. National reconciliation will very often entail some form of power sharing. Here we could try to explain how power is shared in countries as diverse as Switzerland, Bosnia, Northern Ireland and, as my noble friend Lord Sandwich mentioned, Nepal. Federal states such as Germany, the USA, India, Canada and Australia also provide models of how to distribute power and responsibilities.

Lastly, British foreign policy should take account of the acute needs of refugees in the Middle East. Palestinians have been in exile since 1948, while Syria and Jordan are now hosts to hundreds of thousands of Iraqis. The Middle East cannot be left to stagnate. The peace-loving majorities that exist there must somehow be helped to prevail.

Photo of Lord Ryder of Wensum Lord Ryder of Wensum Conservative 4:00 pm, 26th February 2009

My Lords, I have long admired the reflections of my noble friend Lord Marlesford on foreign affairs and I congratulate him on his speech today.

I want to contribute briefly on one subject: Russia. I welcome Vice-President Biden's "reset button" speech in Munich designed to mend fences with Russia and I applaud the Russian Foreign Minister for declaring his desire for relations between Russia and NATO to get back on track. However, I hope that these two men are not indulging in naive expectations. After all, we have endured political leaders in Washington and London whose fragile historical knowledge has landed us in quagmires in Iraq and elsewhere. Some leaders have belonged to the neoconservative tendency and others have rejoiced as disciples of Woodrow Wilson's belief in global democracy, now refashioned as liberal interventionism. The actions of these principles have damaged respect for the West.

East-West relations deteriorated after the 2001 Genoa G8 summit, when Vladimir Putin's efforts to sculpt a modus operandi with the United States were shunned by President Bush, who lacked a grasp of the Russian mindset. Putin is merely the latest in a long line of autocratic Russian and Soviet rulers. He is a Tsarist without the regalia. It was said in 1917 that the only change to diplomacy was the personnel in the Kremlin. When the Cold War ended, not even Kremlin personnel changed in weight of numbers.

Democratic transition has stalled in Russia. This is no surprise; Russia was never likely to speed towards a pluralist liberal democracy with Jeffersonian institutions founded on the separation of powers and the rule of law, underwritten by a free press. Russia is not liberal, yet it is as liberal as it has been in its history. Nor is it likely that Russia will want to share western values. Putin is icy to our purest forms of democracy and markets. His Tsarist model will survive for the foreseeable future. The collapse of the rouble and social unrest in Russia's rust belt strengthen his position.

In Russia, the urge for territorial expansion has always been generated by vulnerability and the anxiety of invasion. This fear of encirclement is centuries old, stretching back to the Mongol Khans, the Poles and Lithuanians, the French and the Germans. It is genuine, not feigned, and concreted into the Russian psyche.

Of course it is natural that Soviet republics, victims of Soviet tyranny, should want to embrace liberal democracy. It is equally plain from a study of Russian history and the nation's fear of encirclement that it should feel the need to establish spheres of influence. Yet Vice-President Biden's Munich utterances, as well as our Foreign Secretary's speech in the Ukraine last August, specifically ruled out acceptance of Russian spheres of influence.

Today's spheres of influence, although different in size, are no different in character from those that determined the balance of power in mid-19th-century Europe. Spheres of influence are hewn from landscapes to produce a balance of power that is either stable or precarious. At present, it is relatively stable. The skill of Palmerston and Bismarck was to gauge the difference. My noble friend Lord Marlesford aptly quoted Palmerston on allies and enemies. Contemporary leaders should conform to this wisdom; after all, the world has not advanced to the so-called end of history, but has merely fragmented into different sides, reshaping older rivalries. In terms of the balance of power, Russia is not a strategic threat or an unceasing enemy. Nor is it brewing an ideology for export. I subscribe to the Kissinger maxim that the balance of power is a permanent undertaking, not an exertion with a foreseeable end.

The arrival of a new Administration in Washington affords us the chance to contemplate these realities and, for once, to use the past as a signpost to the future. Centuries of Russian behaviour cannot be reordered by the West. The challenge is not how to change Russia but how to manage our relationship with Moscow. We must achieve a better balance between containment and selective engagement, by testing Russia's desire for a more harmonious relationship in the tradition of pragmatic caution. This entails modifying our tone with Moscow over democracy. It requires a pause from raising extra flags outside NATO headquarters. After all, meaningless guarantees can lead to shameful betrayals. It demands a freeze on the installation of ballistic missiles in eastern Europe and it means an acknowledgement of Russian energy dominance in the Caucasus. We should strive for a settlement with Russia, a tacit understanding of power balances, in our own interests. We share common objectives, such as restricting the hazards of radical Islam and persuading Iran not to develop nuclear weapons, or hampering it in its efforts to do so.

President Obama's election is leading to a review of the West's relationship with Russia. I hope that the Government, and in particular the Government-in-waiting, will devote extra attention to studying how the lessons of history should guide the West to a more realistic approach.

Photo of Viscount Montgomery of Alamein Viscount Montgomery of Alamein Crossbench 4:07 pm, 26th February 2009

My Lords, like many speakers I congratulate the noble Lord, Lord Marlesford, on his brilliant introduction. It is definitely worthy of further study. His choice of title was particularly subtle: it is quite clearly a very complex subject. Having listened to many speeches, one can see the enormous variety. A good example was the speech of the noble Lord, Lord Ryder, which illustrated the complexity of the subject and what is needed to confront the various challenges that face us. My sympathies lie with the noble Lord, Lord Davies. I am not sure how he can possibly sum up this incredibly wide-ranging debate in 25 minutes. I wish him well in that endeavour.

As anticipated by the noble Lord, Lord Wallace of Saltaire, I will turn to Latin America, where my experience over many years lies. In that capacity, I follow the noble Baroness, Lady Gibson, whose vice-chairman I am in the all-party group, and the noble Baroness, Lady Hooper, with whom I have worked for many years to promote Latin American affairs.

Sadly, British influence has declined slowly since the Government decided that Latin America was no longer a priority. It was a very curious decision, since the GDP of Latin America is considerably more that that of Africa and the Middle East combined, and equal to that of eastern Europe. We are a small country on the fringe of Europe, but a very important member of the EU. The problem is that, although we trade extensively with the EU, when it comes to business, trade and investment, on which we depend, unless we are in joint venture with European companies, we are in competition with them; so we need a very active foreign service in this area. In that context I return to a suggestion made in an earlier debate, that we should close down UKTI and reinstate commercial offices in embassies and generally strengthen the Foreign Office effort in Latin America, which has been declining gradually over the past 10 years.

We pay attention to Brazil and Mexico, of course, which is hardly surprising as they are both important members of the G20. Brazil is the dominant power in South America and growing fast, while Mexico is the power in the north. We all look forward to the visit of President Calderon from Mexico at the end of March. There are numerous opportunities for trade and investment in both these countries where we already have quite a lot of investment.

Turning to more specific challenges, I want to mention Venezuela. Recently President Chavez won a clear mandate for indefinite re-election every six years, starting in 2013. The referendum was conducted with only minor infractions but was hardly a fair contest, as the Government control most of the media and used state funds on a massive scale to secure the yes vote, which also affects governors, mayors and other elected officials.

The second problem concerns the economy. Oil, which is controlled by a state monopoly, accounts for 90 per cent of exports and 50 per cent of the budget. With high prices, Chavez could dispense largesse to other left-wing countries such as Nicaragua, Bolivia and Argentina, but with low prices he has had to withdraw foreign exchange reserves from the central bank.

Sadly, Venezuela is showing all the symptoms that apply to Communist states: the quashing of the media, state funds for the ruling party and a cult of personality of the leader. Despite all this, Venezuela remains a fascinating and beautiful county with very talented people and a youth orchestra of international renown. There are still many opportunities for British business there, but one needs to advance with caution. I wish it well, and hope we can retain an important influence there.

Next is Argentina, where we have an excellent embassy but little direct ministerial contact from London. A number of its opposition politicians have been to London during the southern hemisphere's holiday season. Although the presidential elections are over two years away, the Kirchners are universally unpopular and alliances and campaigns are already well advanced. I get to meet all these characters who come through London and who always deliver the same message: that it is a tragedy that the two commissions covering oil and fishing, set up years ago as a bridge-building exercise, no longer exist because Argentina has withdrawn unilaterally. Both sides would have a great deal to contribute, but the unilateral withdrawal has been more damaging for them than for us. One hopes that the commissions can be reinstated at an early date.

To end on a positive note, at the end of April this year, the four-yearly summit of the Americas will take place in Trinidad, where President Obama is scheduled to make a major speech on both Latin America and Caribbean policy. That will be a major occasion and I hope we can return to Latin America another time to deal with what will happen afterwards, because there are many parts of the continent that are of considerable interest and to which we ought to continue to pay attention.

Photo of Baroness Northover Baroness Northover Spokesperson for International Development, Liberal Democrat Lords Spokesperson (International Development) 4:14 pm, 26th February 2009

My Lords, I thank the noble Lord, Lord Marlesford, for putting down this topic of debate and for his masterly overview. As ever, this debate has shown the enormous depth and breadth of knowledge of noble Lords in this House. Now is indeed a good time to reassess foreign policy challenges, given the election of President Obama and the possible changes in direction of what remains, as yet, the only superpower.

As my noble friend Lord McNally pointed out, if we see a change in political direction in our own country, we need to know what any future government might do. The present Government's track record is clear, and we know where we have agreed and where we have profoundly disagreed with them. The position of the Official Opposition is a lot less clear. Where do they really stand on Europe? I wish the noble and learned Lord, Lord Howe, very well as he so ably fights this battle within his own party.

On Iraq, the Conservatives appear to have done an about-turn but would their gut instincts have led them, perhaps even more easily, to do just as the Government did? On Afghanistan, we hear—we should pay close attention to this—comments from some Tory MPs that they regard our role there as pretty much doomed. The noble Lord, Lord Marlesford, has expressed his own doubts.

On development, do the Conservatives really have the gut commitment here? My party's understanding of why Europe is so important to our influence in the world, our economy, prosperity and security is well known. My noble friends Lord Wallace and Lord McNally have again expressed this extremely clearly. Our internationalism and commitment to development are also well established.

We know that President Obama is committed to internationalism and dialogue. It is somewhat ironic that such an approach should be so welcomed across our own political spectrum when it was this Government, supported by the Official Opposition, who joined in setting aside what the UN might do with its weapons inspections in Iraq. As converts, however, the Government and the Official Opposition are very welcome.

There are extremely hopeful shifts in the new American Administration on the Middle East, as we have heard—on Iran, on human rights, as shown by the proposed closure of Guantanamo Bay, and on climate change. The challenges facing Obama on the economy may force him to look inwards and the challenges of his electorate may restrict what he can do.

We also know how dangerous it is to align ourselves too closely to one dominant ally where our interests can be trampled upon. The noble Baroness, Lady D'Souza, made some sobering comments on Afghanistan. Although we are the major contributor there behind the US, can the Minister say whether, in the recent review, UK participants were included in the assessments but barred from helping to frame the conclusions of that review and that it was to be a US-only exercise?

As others have said, all our decisions may be overshadowed by the current extraordinary economic firestorm. If anything proved how interlinked our world is, this does. In 1918, the flu took six months to spread round the world but SARS recently took only 48 hours to reach four continents. Thus, too, the mis-selling of sub-prime mortgages in the US and in the UK, as my honourable friend Vincent Cable warned us, has had the effect of bringing global banking to its knees. It has also brought countries, including Iceland, Hungary and Latvia, to the verge of bankruptcy, creating massive economic destruction in its wake. We have barely felt the effects yet and we know only too well the political consequences of other severe recessions in the past. We need to beware of protectionism.

We have to remember the UN High-level Panel's dictum of 2004 that development is necessary for security. I echo the noble Earl, Lord Sandwich, and the noble Lord, Lord Joffe, and take issue with one or two other speakers. There need not be a conflict between the undoubted need to strengthen the SEO—I have seen how remarkable its teams are in the Middle East and Africa—and what DfID does. Indeed, DfID addresses poverty, but we know that poverty leads to instability, and instability affects us all. We surely need to see the FCO, DfID and the MoD working together. Following the comments of the noble Lord, Lord Ramsbotham, I suggest that Trident should perhaps be therefore placed in the Olympics budget.

Just as the Recess started, some announcements on the DfID budget were made. It seems that £1.65 million was transferred from DfID to DCMS for the Olympics budget. Almost £19 million was transferred to the MoD and £1 million to the FCO for the returns and reintegration fund. What is that all about? If it was always scheduled, are the amounts exactly as was originally planned? What is the effect on the percentage of income now devoted to overseas development? Are we beginning to see the effect of the black holes created by Iraq and now the financial crisis? These may be very worthy operations, but why has funding shifted from DfID to elsewhere?

As we address poverty and instability, we have to recognise the significance of climate change, as others have said. The shift in attitude of the Obama presidency is extremely welcome. If we did not realise how climate change might contribute to instability, we should look at Darfur, where the spread of the Sahara desert has played its part in displacing people so that they prey on others. The international community is then drawn in, and we take in asylum seekers displaced by the fighting. We have heard from my noble friend Lord Chidgey quite how fragile are the states in that region.

Ensuring that the international community is better able to deal with global problems is a major challenge. The UN has achieved a great deal in its historically very short life. What plans are there to try to improve its ability to protect? That ability is dependent on member states and their actions. What is being done to maintain and improve such international focus? Perhaps the Minister could comment on the situation in Sri Lanka and Zimbabwe in this context.

Problem areas of the world have been mentioned by many noble Lords. My noble friend Lady Falkner effectively highlighted the significance of instability in Pakistan and its effect on the region. A number of noble Lords have mentioned Israel/Palestine. Surely the time has come to talk to Hamas, as a letter in today's Times, to which the noble Lord, Lord Wright of Richmond referred, from Michael Ancram, Paddy Ashdown and others makes clear. It states:

"We must recognise that engaging Hamas does not amount to condoning terrorism or attacks on civilians. In fact, it is a precondition for security and for brokering a workable agreement".

As we know, it was not military power which in the end prevailed in Northern Ireland, but the use of economic measures, legal measures to protect against discrimination, establishment of the fact that the rule of law meant something and the slow progress of dialogue.

Other challenges have been flagged up in this debate, including dangers from nuclear weapons. The House may like to know that the Lib Dem debate day on 26 March will be led by noble friend Lady Williams of Crosby, who is very sorry that she could contribute today. She will lead the debate on nuclear disarmament.

We have also heard about the situation in Latin America, Russia, Africa and elsewhere. There are then the challenges of tackling corruption, the arms trade and improving governance, which are all enough to keep you awake at night. However, although we may feel very pessimistic about the world today, anyone who heard Archbishop Desmond Tutu speak the other day at the British Council, as did I and the noble Lord, Lord Anderson, should perhaps take heart from his philosophy of hope. Perhaps this links back to what the noble Lord, Lord Anderson, said about the difficulty of reading the future. For Tutu, the dismantling of apartheid, the election of a black president in the United States, the comeuppance of Bush—for whom he felt slightly sorry and whom it had seemed impossible to defeat on the invasion of Iraq—all showed that change was possible, even it came very slowly.

We need only look at Northern Ireland to see what might be done in the Middle East with the kind of engagement we may, at last, be beginning to see. People used to despair of economic development in Asia. It was deemed hopeless and impossible, not least for cultural reasons—now look at it. We heard from the noble Baroness, Lady Amos, about the problems, but also the progress, in Africa now. We see major challenges in foreign policy and need to know where all the parties stand on the route forward. I look forward to the Minister's speech.

No one can deny that change is upon us. In the middle of economic turmoil and with conflict around the world, we surely have to work with our international partners, whether in Europe, the United States or across the UN, to bring greater stability, prosperity and order into the world for our mutual benefit.

Photo of Lord Howell of Guildford Lord Howell of Guildford Shadow Minister, Foreign Affairs, Deputy Shadow Leader, Parliament, Shadow Minister (Foreign and Commonwealth Affairs), Shadow Deputy Leader of the House of Lords 4:26 pm, 26th February 2009

My Lords, in a star-studded debate, the undoubted star has been my noble friend Lord Marlesford; everyone has agreed about that. He gave a superb opening offering for this debate. That does not surprise me—I worked closely with him a long time ago and have done since. Forty years ago, we worked together on the restructuring of the government system that was going to be required as we moved from the socialist age into the market age. From his fertile mind came such innovations as the Central Policy Review Staff, central capability and the systematic questioning of public sector and Whitehall objectives and outputs, in a way which would lead to more efficient delivery. I am afraid that particular lesson seems to have been lost. These were, in many cases, the initiatives of the noble Lord, Lord Marlesford, then under his commoner name of Mark Schreiber.

This been a good debate and I hope, as many of us have said, that it will be listened to. I am told that in a depression, a slump, super-recession, or whatever we are in, people tend to crowd into music halls and places of public entertainment, to drown their sorrows. We cannot compete with that but I hope that people will pick up some of the wisdom that we have heard this afternoon. It is setting a new tone. Although we have heard some clichés and demands for new narratives, which turn out to be the old narrative, we have also heard a number of new insights into what is, frankly, a totally new situation.

The foreign policy issues are completely interwoven with the enormous global financial crisis engulfing the entire planet. We are in a new situation. I know the word "paradigm" gets overworked, but the contours in relation to which we now have to think about what is happening in the world are different from those of a few months ago and totally different from those of a year or two back.

Even the assumptions of 2008 are being invalidated in 2009, while we debate these issues. At a time of almost universal concern and uncertainty about the course of economic events, financial turmoil could, at any moment, spill out into civil and political order, and it has begun to do so in many countries. Irresistible pressures for protection may lead to the downfall of the whole liberal trading order—a matter about which the noble Lord, Lord Marlesford, reminded us in his opening speech—and the need for clarity of definition in our national role and purposes becomes more necessary than ever. We cannot deliver that in one debate, but we have begun to hear the beginnings of the new outlines in this frightening situation.

I want to headline some of the major shifts in world conditions, which make our old stances and diplomacy so utterly inappropriate for the new situation that now confronts us. First, the USA is still a mighty and rich country, despite being sodden in debt, sub-prime mortgages and so on. It is a rich nation and a fine ally, and it is under a new leader who gives us all great hope. But the fact is that America is no longer the automatic leader of the world as some US officials still seem to think. Why is that so? Because we live in an age of networks, in which there is no single top-dog leader; the theme becomes not "go it alone and America will lead" but team co-operation, with America supporting. That is why my favourite phrase from Mr Obama's excellent oratory so far is his call in his inaugural speech for humility and restraint in America's approach to foreign affairs. That is the best stance for America and a major shift from the past.

Secondly, power has shifted away not only from Washington but from the whole Atlantic axis and we are only just adjusting to the fact that western hegemony no longer "rules okay". The rising power centres and rising markets, when we have got through the present crisis, will be in Asia—in China, India and Japan and the whole Chinese diaspora of south-east Asia—and in Latin America. That includes Brazil, as several noble Lords reminded us, including the noble Viscount, Lord Montgomery, and the noble Baroness, Lady Hooper. There are also countries such as Canada, which is emerging as a giant new energy power. This demands a new respect, as my noble friend also pointed out, and even deference in place of the somewhat hectoring and superior tone of the western powers and, particularly, the Washington powers, in recent years.

Thirdly, there is the European Union, which is our important regional zone and club in which we live, so to speak. It has achieved great things; I never denied that. I hope that I shall not disappoint the noble Lord, Lord McNally, at this point, because I know that he has especially come back to catch my every word—they will not be worth holding. We want to see the EU evolve in a constructive way. We make no secret of the fact that we did not think that all aspects of the Lisbon treaty delivered that, and that debate on that matter continues. But I think the noble Lord, Lord McNally, and his colleagues would agree that the EU today is already very different from the EU of the summer only a short while ago, with the difficulties in eastern Europe and the real dangers of default and civil unrest in parts of the new member areas of eastern and central Europe. That EU is in turn totally different, of course, from the EU that we first signed up to at the beginning of the 1980s. Twentieth-century visions of how we want to work with the rest of the European Union and be good Europeans are out of date, particularly the idea of the EU as a sort of old-style bloc or superpower in the kind of world that is no longer with us.

Fourthly, power has not only drained away from the Atlantic capitals but slipped away from all nation states and all Governments, because there are now more than 1.5 billion people tapped into the world wide web and making their mark on opinions and events. We live in an age of networks, soft power and sub-governmental and non-governmental linkages between states and societies, which require new diplomatic machinery—a point that I shall speak on more in a moment—at state level. They require a much greater diplomatic resource, as the noble and gallant Lord, Lord Bramall, rightly reminded us.

Fifthly, the world's and our own energy mix is changing fast. Energy is the lifeblood of our society and can of course switch us off at a moment, killing everybody and everything if it is not there. The energy mix is changing, which to some extent downgrades the importance of the old fossil fuels, oil and gas; it certainly changes the shape of our concerns about the Middle East and Russia, exposing the UK to very clear medium-term risks. So there we have the new realities. I am not talking about extrapolations, distant visions or hopes for fighting climate change—those are important—but about here-and-now facts which are already establishing themselves on the international stage and which pose immediate and important questions for British foreign policy.

Do we have the right stances and tones in our relations with Washington, Brussels and with the new rising powers of Asia and the Middle East? That valid question has been raised in the debate. Years ago some of us commented that the Blair concept—if I can call it that—of the UK as a bridge between America and Europe did not really work and was always a flawed idea. Indeed, speakers have said that even the New Statesman has woken up to that fact.

Do we have the right military and security dispositions to meet these entirely new conditions? Is American policy, as we think it is emerging under Mr Obama, the right one for us to follow in both detail and tone? Do we want to get into that lapdog style against which my noble friend Lord Marlesford warned? Do we want to follow the emerging policy with regard to Afghanistan or to Pakistan, where some strange things are going on? Do we want to follow that policy towards Israel, Lebanon, Syria, Iran, or towards Iraq, where hitherto Britain has followed American policy almost slavishly? It is now clear that the US policy of economic sanctions and military threats towards Iran has failed. Iran is accelerating its programme. We have seen photographs of Russian technicians starting up the Bushehr plant this very week. So that policy has failed and a radically new approach is needed. The right reverend Prelate the Bishop of Ripon and Leeds rightly pointed that out.

In an age of asymmetric struggle, non-state terrorism and low-intensity warfare, are we right to be spending so many billions on vast hardware projects or on military procurement, which appears to be poorly managed in some cases? Are we right to spend such sums on upgrading Trident deluxe style, as the noble Lord, Lord Ramsbotham, asked in the debate and in the letter in the Times? Or are we pushing resources in precisely the wrong direction, leaving our troops inadequately equipped at times and with very low morale, as my noble and learned friend Lord Howe and my noble friend Lord Marlesford pointed out?

Are the international institutions of the 20th century the right ones for the new century? This country always takes great pride in belonging to practically everything. We belong to NATO, the European Union, the UN Security Council and the WTO, but are they the best channels through which to project our aims, to make our contribution and to guard our security today?

A very pertinent question was asked in the debate: are we investing in the Commonwealth as a power network of the future? My noble and learned friend Lord Howe and my noble friend Lady Hooper rightly asked that question. Are we right to invest—here I must tread carefully—so much time and effort in the endless EU institutional debate which we went round and round last summer, as your Lordships will remember? Are we right to put so much of our overseas development effort through the EU machinery? Is the EU defence structure—it is obviously important to have a defence structure—the one on which we should pin all our hopes? Have we grasped the need for a far wider context than just the EU in which to grapple with the financial reforms the world needs and the resolution of the complete imbalance between high-savings Asia and the debt-saturated western world, which was the cause of a lot of the overspending and wild borrowing which has led to the present global crisis? Are we braced in our foreign policy for the next Euro-crisis and the need to bail out, for example, Ireland, Greece, Austria, Hungary and other central European countries? That will come over the horizon in the next few weeks. We may, mercifully in my view, be free of the euro system, but the impact on our already shrinking export markets will be devastating.

A constant issue that came up in this debate was the question: have we adjusted our foreign policy priorities to our new pattern of energy needs? Thanks to the nuclear delay we face a period of immense danger and vulnerability to global gas markets. Will our policies protect us?

Finally, and most importantly, do we have the right ministerial and administrative systems here in London to adjust flexibly and swiftly to the new conditions? Have we got the balance between DfID and our aid policies and the Foreign and Commonwealth Office and our diplomatic resource right? Or is there a malaise, as my noble friend Lord Hurd, with huge wisdom and experience, suggested—as indeed did my noble and learned friend Lord Howe with equal wisdom and experience? What about the closure of embassies? What about demoralisation? What about the points made by the noble Lord, Lord Wright of Richmond, the former boss of the Foreign Office? Are these issues that we can afford to let drift in these new conditions?

I have to answer a blunt "no" to all those questions. One only has to ponder for a moment on the basic realities that I have described to see how hopelessly inapposite all the policy stances behind these questions have become, as well as the systems that we have to administer them. It is a dispiriting picture. At a time when we should be forging new alliances with the powers that will affect our destiny, when we should be vigorously promoting new and more flexible regional structures for the EU, when we should be building up the Commonwealth as the ideal soft-power network of the future, when we should be massively strengthening and modernising our security forces to meet asymmetric threats, when we should be redirecting our development and aid policies, and when we should be reconstructing our overseas ministries to get a better resource balance and upgrade our whole diplomatic resource, we are doing none of those things.

Instead, we remain locked in old ambiguities in our foreign policy. This is querulous indecision disguised as strategy and adamant for drift. It leads directly to a national loss of purpose, endangers our future, weakens our contribution to international goals and projects an image of defeatism and lost confidence. It also demoralises those very able diplomats and foreign policy practitioners who find themselves wired into the wrong administrative structure travelling along the wrong tracks.

The global context has changed. Within it we need a new foreign policy direction based on a deep and intelligent analysis of the new world conditions, and we need new government machinery to operate it successfully with confidence and vigour. I am hopeful that my right honourable friend, the very able William Hague, will set the movement in that direction. Our country, built on its amazing and dazzling past, is still full of talent and vitality, and it deserves no less.

Photo of Lord Davies of Oldham Lord Davies of Oldham Deputy Chief Whip (House of Lords), HM Household, Captain of the Queen's Bodyguard of the Yeomen of the Guard (HM Household) (Deputy Chief Whip, House of Lords) 4:43 pm, 26th February 2009

My Lords, this is a challenging debate to respond to. When my noble friend Lord Malloch-Brown indicated that he could not be available, my heart sank and it has not risen during the debate, as the complexities of the situation assaulted me on every side. First, however, I congratulate the noble Lord, Lord Marlesford, on his introduction. I shall do something a little different in this speech; I intend to respond at the end to his major points, because in many respects he set a context to which we need to respond. I am grateful for the way in which he established the debate, but, inevitably, a whole range of detailed issues have arisen.

I was about to congratulate the noble Lord, Lord Howell, on his speech. For two-thirds of it I was entirely content. Not only that, but I was admiring the dexterity with which he replied to the pointed and single question of noble Lord, Lord McNally, by posing seven questions of his own, none of which will get an answer at this stage, but it was a deft way of turning the problem elsewhere. I agree with a great deal of what he said: we need to think about our foreign policy strategically and about our general policies on overseas issues in the context of a greatly changed environment. I will emphasise those points towards the end of my contribution, but I feel bound to reply to a number of issues that came up in the debate, given that noble Lords have not only spent time preparing and delivering their speeches but sat through getting on for five hours of this debate. They deserve some recognition for their work.

My noble friend Lord Anderson first opened up the issue that the noble Lord, Lord Howell, commented on a moment ago and which other noble Lords emphasised. That flowed from the introductory approach of the noble Lord, Lord Marlesford: what about the issues regarding the strategic priorities? We established a clear Foreign Office strategy in 2008, when we set out a White Paper. We clearly need to develop fresh thinking about the overarching issues against a background in which the world has dramatically changed in certain areas. A great deal of thinking on those issues is going on. It was notable that, in the debate, only glancing references were made to those parts of the problems that confront the whole world and require the international co-operation to which the noble Lord, Lord Marlesford, referred. Those are particular issues, such as climate change.

I heard the noble Lord, Lord Hurd, talk about declining Foreign Office resources; I will come to that in a moment. However, it will be recognised that different problems require different response strategies and that our tackling of climate change necessitates more than foreign representation. There must be much crucial and specific expertise. Britain has taken a leading role on the challenge of climate change and so I hope that this debate will be put into the context that the noble Lord, Lord Marlesford, urged. We appreciate the broad and outstanding challenges that face the world, not all of which fall easily within the framework of more conventional foreign policy. My noble friend Lord Anderson is therefore absolutely right that we need a strategy for priorities. We will, in fact, develop that along the lines that he indicated.

Against that background, my noble friend Baroness Amos and the right reverend Prelate the Bishop of Ripon and Leeds emphasised that we need to make international institutions more representative. As we would expect from my noble friend, her excellent contributions support Africa in all these debates. The noble Lord, Lord Chidgey, spoke about Uganda and the Great Lakes and the noble Lord, Lord Blaker, talked about Zimbabwe. No doubt we all recognise that Africa presents a range of serious challenges. Conflict in Africa has reduced significantly in recent years, but that does not make the conflicts that are still being sustained any more bearable for the people involved. Several of those conflicts are as bloody as the world has ever known and cause the most enormous distress to all the victims involved.

The noble Lords, Lord Wallace and Lord McNally, emphasised the European Union as being central to UK foreign policy. The Government entirely agree with that and no doubt the noble Lords drew the sustenance that I did from this Dispatch Box when the noble and learned Lord, Lord Howe, also emphasised those points. We await developments.

I heard about one development that I am not too sure about. I heard as distinguished a contributor as the noble Lord, Lord Ryder, whom I remember in a past life as a Chief Whip, talk about the Government-in-waiting. The last time that I remember that phrase being used more frequently than I would have liked was in 1991. It was used by the Opposition at the time. I happened to be a figure involved in the Opposition's strategy; I may even have used it myself. I can assure him that we then had similar opinion poll leads as his party has at present. We lived to regret that outrageous term used prematurely. Perhaps the Opposition should mute their position, especially in debates of this kind. We should deal with the powers that be and what the Government are doing at present.

As the noble and learned Lord, Lord Howe, and my noble friend Lord Anderson emphasised, we intend to work to strengthen the capability of the European security and defence policy. It was mentioned that, increasingly, when it comes to international trade and development, the world, especially countries such as China, expects Britain to work within the European framework. In crucial areas, against a background where the pressures on the United States are intense, a European response is increasingly looked for in partnership with the United States. Although we will always enjoy a special relationship with the United States, we will not delude ourselves about the fact that any United States presidency, even one as radical, challenging and, in many ways, encouraging as that of President Obama's in providing hope for all of us in participating in a better world strategy, will look to Europe—not just the United Kingdom but Europe—for support on the international stage.

If there is one aspect of the debate that did not get the emphasis that it should have had—although the noble Lord, Lord Marlesford, dealt with the issue in suitably optimistic phrases in his introduction—it is that we recognise the point made by the noble and learned Lord, Lord Howe, that the United States is no longer the arbiter of the world with quite the extreme superpower status that it enjoyed alone for several years after the Soviet Union collapsed. America is now operating in a world in which there are several other significant economic reference points. Military power is not the only determinant of great power status.

We must recognise the more muted position of the United States. That does not alter the view that we should look with optimism to the fact that some of the strategies that the United States pursued during the past decade are being revised. The President has indicated that he intends to revise those strategies; we should take delight from that and recognise that it is more likely that the way in which the United States pursues its objectives will be more in tune with the predispositions of this country than may have been the case during the past decade.

I speak especially of the Middle East. The noble Lord, Lord Wright, made his usual thoughtful contribution on that and said that we often have to learn to talk with those whom we have regarded as the outright enemies and almost beyond the pale because of how they have acted. He is right. That is the only way in which, eventually, peace is secured.

We recognise that the United States has a more flexible and constructive attitude to opportunities in the Middle East, which will require it to introduce pressures that have been absent in the past. America has not been prepared to talk with those who can contribute, even though they are often hostile to the values that we all have in the West. They are essential if we are to produce peace in such a desperately troubled area.

One aspect of the debate that I found stimulating and challenging, but to which I have no positive responses to make, is that commented on by the noble Lord, Lord Ramsbotham, the noble and gallant Lord, Lord Bramall, and, to a more muted extent, the noble Lord, Lord King, in discussing the defence resources that we have available. We all know how pressed our military forces are in meeting their obligations. In Afghanistan, we recognise the commitment of the United States to additional support and additional troops in Helmand province, which is an indication of a constructive response on the part of the United States. British troops are doing a wonderful and gallant job in Helmand province, but we all know what the challenges are.

I am grateful to all those noble Lords who discussed Afghanistan—the noble Baroness, Lady D'Souza, began the debate on this area—and the relationship between Afghanistan and areas of Pakistan over which no obvious legal authority obtains. The noble Baroness, Lady Falkner, in particular, emphasised the significant challenge for international diplomacy. Military might may produce the conditions in which it might be possible to win support for the development of Afghanistan, but it will not produce the development itself. We face an international situation in which it is difficult to see where the levers are for effective diplomacy to be deployed. That is why none of us should underestimate the challenges that Afghanistan produces and why I must be responsive to the obvious fact that Afghanistan looks to be a long trail ahead. There is no immediate solution to the Afghanistan problem.

I agree very much with the priorities that have been mentioned and about the way in which they can be developed, as emerged in the constructive contributions to this debate. However, none of us should think that success in Afghanistan is just around the corner, because it is not; it is a long and abiding challenge for our forces, which is why we have to make sure that the resources are there for them to engage successfully.

I cannot offer to the noble Lords whom I just mentioned support for their view that additional resources might be available for our forces in Afghanistan and elsewhere if we thought again about Trident. The Government's position on Trident is clear: we intend to replace Trident because we regard nuclear weapons as a necessary element of the capability that we need to deter threats from others. Conventional forces cannot have the same deterrent effect and we all recognise that we live in a nuclear world. I hear what noble Lords have said about the necessity for adequate resources for our conventional forces—those issues have to be addressed, particularly if the obligations on our forces increase—but I disavow the idea that our forces are not currently provided with the necessary resources and I certainly do not think that we could solve the problem of resources for conventional forces by saving money on the renewal of Trident. The Government have made that quite clear.

The noble Lord, Lord Hurd, also introduced into the debate an element that, I have to confess, I had not anticipated. I wish that I had, as I would have briefed myself about it more thoroughly. He raised the question of the relative resources available to the Foreign Office and DfID. My noble friend Lady Amos made the case for DfID needing significant resources in the essential role that it plays, not just in Africa but elsewhere. There is no way of achieving stable government and the prospect of peace if the only things that people face are abject poverty and desperation, because out of poverty and desperation aggression often develops.

Therefore, we have to put a great deal of emphasis on development, and I make no apology for—in fact, I take pride in—the extent to which the Government have devoted resources to DfID in these areas. When one talks to Governments in Africa, they emphasise strongly development support. However, I appreciate the point made by the noble Lord, Lord Hurd, that that must not be at the cost of the Foreign Office not being able to meet its obligations with regard to diplomacy in the wider world when that is such a crucial feature in the challenges that the world presents.

I emphasise that we do not regard this as a matter of competitive resources. We seek to ensure that DfID, the Foreign Office and the Ministry of Defence work together closely with our partners across government to deliver on UK objectives through their respective contributions. One aspect of this co-operation is the public service agreement to prevent and resolve conflict. The FCO, the MoD and DfID work jointly on that objective. I take on board what the noble Lord, Lord Hurd, said, because I respect the positions that he has held in the past and his deep knowledge of foreign affairs. As he indicated, that knowledge goes a long way back, to his first professional role. Of course I respect that, but I hope that he will take it from this Dispatch Box that, so far as concerns our influence in the world, we have no intention of reducing our resources. The noble Lord may not altogether agree with the direction that we pursue, but the Government are clear that, through successful co-operation between the relevant departments, we will meet the objectives that we set ourselves. Those objectives are very wide.

My noble friend Lady Gibson, the noble Baroness, Lady Hooper, and the noble Viscount, Lord Montgomery of Alamein—I thank him for his sympathy about winding up in this debate as I flounder even more in coping with all the contributions—all raised issues concerning Latin America. Our representation in Latin America remains strong for the obvious reason that there is enormous potential for economic growth in that area. The noble Baroness, Lady Hooper, emphasised the business opportunities and growth in Brazil, which is rapidly becoming one of the world's significant economies. We have a broad, deep and sustained relationship with that country. It is a key partner of the UK on a wide range of global issues from climate change and combating drug trafficking to promoting an expanding global economy. Brazil is playing a full part in the G20 process and will, without doubt, make a significant contribution in April.

My noble friend Lady Gibson also raised the question of visas and the visa waiver test. We made an announcement a few days ago in the other place about how the global visa waiver test will work. I hope that my noble friend will realise that, because we place such importance on our bilateral relationships with these countries, we will of course maintain flows of tourists and others who need to take advantage of a visa regime between our countries. We will be careful to safeguard the interests of Bolivia and other countries in Latin America. She will also know that there are attendant problems that we have to address, which were part of that announcement on 9 February. Within that framework, we will seek to meet the objectives that she has suggested we should pursue.

Issues were raised with regard to Russia by the noble Lord, Lord Ryder, and the noble Lord, Lord Weidenfeld, who also mentioned Ukraine. Of course, Russia is an important player on the international stage and we take great satisfaction from the United States indicating that it wants to look afresh at its relationship with Russia. There were comments in the debate to the effect that the West had not handled the immediate post-Soviet position and the new Russia with the greatest delicacy and insight. The noble Lord, Lord Weidenfeld, made that point quite strongly. We need to learn lessons from that. Russia has a crucial role to play. This means that, when we look at European or NATO expansion in relation to Ukraine or Georgia, we must tread with considerable care. We know why Russia is deeply anxious about such developments and we ought to take some satisfaction from the fact that the United States obviously thinks that it needs to reset the button in its relationship with Russia. We will play any part that we can in facilitating such developments.

I turn now to what I regard as the most important part of this debate, which is the context that the noble Lord, Lord Marlesford, established. He said that this debate was about the challenges of foreign policy. All foreign policy is challenging. There is not an aspect of it that does not pose difficulties. That is why we need the resources that we have to approach foreign policy issues. What I think the noble Lord was driving at is that this is a changed world. Indeed it is. It is a world so significantly changed that we have to recognise that we will need to recast our foreign policy priorities.

When one thinks back, there are never absolute parallels. I am very rusty on history. Someone asked me the other day whether I agreed with a quotation from Henry Ford. I thought that he was going to say, "History is bunk", but he did not. Of course, history is not bunk; history is an important source of understanding about human relationships. We understand from the 1930s that when countries chose protectionism and nationalism and tried to solve these acute and grievous economic issues on their own, they could scarcely produce a solution, unless it was a solution of the absolute extremes. One of these was the national socialism of the Hitlerian regime. That produced an economic solution, but only by creating a state of war and the nightmare represented by that fascist regime. In economic terms, the situation is not that different from the 1930s. The nature of the crisis that has developed comes from different sources, but the impact is being felt around the world in the drop in standards of living and the fact that the gross national product of many countries is plummeting. The challenges faced by all countries, both advanced and developing, are so acute that they can be solved only by international co-operation. The other solution is one that would produce disaster for the world.

Therefore, if we are going to respond in terms of an international solution, we have to respond to the point that the noble Lord, Lord Marlesford, made. This is a new and challenging environment and one that the world economy has not faced for more than 70 years, so scarcely anyone active in our economies today is mature enough to appreciate the depth of the crisis. For all of us, this is a new learning experience and all nations will have to reassess their roles and priorities. As the noble Lord accurately identified, Congress and certainly the Senate in America looked at one stage as if they would impose an element of protectionism on the fiscal stimulus that the President was concerned to develop. However, President Obama eventually triumphed and has produced a strategy of openness with regard to investment in the economy. We have to follow suit, as does Europe and the rest of the world, including those economies that have been given due credence today, such as those of China, India and even Brazil, which are so much more important than they were just a decade ago.

We need international co-operation, which is why the build-up to the G20 on 2 April is very important. Although I greatly regret that my noble friend Lord Malloch-Brown, who usually responds to these debates in such a masterly fashion, is not present today, the reason why he is not here is that he is involved in the crucial process of establishing the framework to ensure that the G20 conference in London is a success. The task before us is enormous and no one should underestimate it. We have to restructure and strengthen the broader global financial and economic system. We have to restore confidence and build up trust in a reformed system. My noble friend Lord Joffe said that that will be a challenging task but one that is absolutely essential, because we will not earn the respect and get the contributions of the wider world unless all our institutions build up that confidence. That may be reflected in increased representation, but if representation is not possible at the G20, given its restricted terms, countries must know that their influence is being felt on the deliberations of the conference.

I conclude by congratulating the noble Lord, Lord Marlesford, on introducing a debate to which I believe we will return repeatedly. I use the word "we" as a collective term on behalf of the House. On the next occasion, however, I hope that the Minister will be here to respond to the debate.

Photo of Lord Marlesford Lord Marlesford Conservative 5:13 pm, 26th February 2009

My Lords, I thank all noble Lords who have taken part in the debate, which I personally found absolutely fascinating to listen to and hugely instructive. One of the things that came through was the feeling that it should be widely read in Whitehall. The noble Lord, Lord Malloch-Brown, told me that he intends that it should be read in his department, but obviously other departments could also benefit from it. In fact, I might go further and make one suggestion. The Foreign Office could consider circulating Hansard to the heads of the appropriate diplomatic missions in London, but if the Foreign Office does not want to do that, perhaps the authorities of the House might consider it. Meanwhile, I beg leave to withdraw the Motion.

Motion withdrawn.