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G20 Summit - Question for Short Debate

– in the House of Lords at 6:55 pm on 8th July 2019.

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Photo of Lord Howell of Guildford Lord Howell of Guildford Conservative 6:55 pm, 8th July 2019

My Lords, I declare my interests as listed in the register and in particular that I advise two major Japanese companies.

This debate arises from a short inquiry by your Lordships’ International Relations Committee, of which I was then chairman, and a subsequent memorandum to the Prime Minister before she set off for the G20 meeting in Osaka, Japan, 10 days or so ago. The G20 meeting is supposed to co-ordinate responses to the tensions in world affairs and to take an overview of all the disruptive forces of change sweeping the globe—and, as I think is generally agreed nowadays, to do so with rather more relevance than the old G7 in modern conditions. Frankly, it does not look as though much co-ordination or overviewing went on this time in Osaka.

When she returned, the Prime Minister was subjected to two full hours of questioning on the G20 in the other place—incidentally, a longer time than was allocated for the whole of our debate this evening—and that of course came after her 11-hour flight back from Tokyo. I do not think that that kind of battering treatment of a nation’s chief executive would be allowed or considered even faintly sensible in any other legislature in the world. Anyway, let us hope that the next Prime Minister, not to mention the ranks of Theresa May’s persistent critics, have even half her remarkable stamina.

The questions to her in the other place covered a huge range of topics, from the Chagos Islands to Scotch whisky. Even so, some key issues were completely missed in the exchanges. Therefore, perhaps it would be useful for me to comment first on those key issues—in other words, what should have been there but was not.

I begin with Japan itself, where it all took place. In her Commons Statement, Mrs May mentioned the growing strength of the relationship between the UK and Japan, but in all her questioning no one repeated it or referred to it. That is rather odd because Japan is by far our best friend in north-east Asia, the world’s fastest-growing area. We may not like some aspects of Japan, such as its judiciary or the persistence in whale killing, but it remains the third biggest industrial power in the world, with immense creative momentum, especially as the “globotics” revolution takes hold. We will need it very much in the future.

I have argued for 30 years that our foreign policy experts should take the Japan connection much more seriously and creatively. Osaka should have been—and I hope that in the sidelines, it was—a golden opportunity to carry forward our defence and security links, as well as our trading ties with Japan and all Asia, with the new networks of trade and investment that are rapidly developing there.

Then there is our China policy. The G20 coverage was dominated by the US-China trade wrangles, but it is our interests that badly need developing and clarifying. America is not going to do that for us. Unlike America, we do not see China as the enemy. Of course, we have to treat our China connections with great caution, but this nation will stand or fall by its agility in balancing its connections with both China and America and not by being trodden flat between the two in the totally new pattern of world power that has now emerged, nor simply by clinging to the coat-tails of Trump’s America all the time, as some of the shallower columnists in the media keep urging. I hope that is not what we were doing last week in taking over the Iranian oil tanker in Gibraltar that was bound for Syria, and that it is not what the new Prime Minister will do; that would not be the right pattern to follow.

There are aspects of China in the human rights area that we rightly dislike—some nasty stories circulate about its treatment of minorities, especially the Uighurs and their culture—but there should be no illusions: China is now a major global player as a supplier, a market, an influence and an investor across the world and right up to our own front door. It is the world’s largest trading nation. Its R&D expenditure soared to $298 billion last year, the second highest in the world. I believe that we can box much cleverer with China than the hot and cold, unpredictable views that come from Washington, using track-two and three diplomacy to the full on issues such as Huawei, 5G and the East/West technology split that some Americans apparently want to see and which at all costs we should avoid.

Hong Kong was not actually mentioned in the communiqué or the report back to the other place but it is certainly right for us to insist on Hong Kong freedoms under the law, including the freedom to protest, the principles of the 1984 Sino-British declaration and so on. However, the violent physical trashing of the Hong Kong legislature is something else. It is wrong, and in my view we should have been much more forthright in saying so than we have been.

As for the Russians at the G20, Vladimir Putin may not be the nicest of characters, as the Prime Minister’s handshake photo made crystal clear, but undoubtedly he has a super-sharp mind and a mastery of prodding us at our weakest points. Liberalism may not be dead or obsolete in the West, as he claimed, but it is undoubtedly under severe assault from narrower varieties of populist nationalism, coming from both left and right, vastly amplified and empowered by digital communications and pushing Governments all the time inward, towards more protection and reluctance to co-operate internationally in line with the rules-based order.

As for climate concerns, the Prime Minister spoke proudly at Osaka of our Government’s new commitment to zero emissions by 2050. By itself, as everyone knows, this would hardly move the needle in fighting climate change. Indeed, if we manufacture less and import more carbon from overseas, it might actually have the reverse effect. So the key aim has to be, and can only be, through example impact, especially on the really big global emitters: China, India, Russia and the United States. China is going to be decisive in this situation, with 28% of global emissions and rising fast. We need to hear much more about how the example process is actually going to work. Assurances that the big emitters are listening is not enough, and neither is costly virtue-signalling.

The nature of international trade has changed dramatically in the last decade, especially now that trade relations between China and the rest of the world are entering a whole new phase. Much of our thinking about China is badly out of date, as my noble friend Lord O’Neill reminded us as a witness to our committee. I hope we shall hear from him a little later. It is cultural and professional exchange, the creative industries, the newest technologies and soft power networks that are reshaping world commerce, with Asia taking the lead.

In the forums of the world, we are going to have to defend our core ideas much more effectively. We will have to fight for liberal values with new techniques, methods and expressions. We will have to defend international rules and build as fast as we can new types of social and fair capitalism, as they do in Asia, to counter the inchoate pressures of populist extremism that are growing everywhere and are definitely here to stay.

The G20 was—or should have been—a forum in which to make these tasks a lot clearer and to focus on them more vividly, but this time I am not sure that that is what happened. That may be because technology is moving ahead too fast for Governments to keep up, but that is a debate for another day.

Photo of Lord Grocott Lord Grocott Labour 7:04 pm, 8th July 2019

My Lords, on the face of it, meetings of the G20 represent quite an unlikely and unusual event. When you strip them to their bare bones, it is a meeting of 20 Presidents and Prime Ministers, in this case, although the rank of the people attending varies. They have two days talking among themselves about a huge range of issues ranging from healthcare to migration to international trade. I should say that this is two days for 20 Presidents; even if it were the other way around—two Presidents over 20 days —they would still be hard-pressed to come to any useful conclusions on such a range of issues. When we held our short inquiry into the upcoming G20, as it then was, we had three excellent witnesses, Alan Wheatley of Chatham House, Dr Linda Yueh of the University of Oxford and the noble Lord, Lord O’Neill, of this House, who is in his place and will be speaking later.

I shall address not this specific G20 especially but the structure, scope and effectiveness of these meetings. First, what are the comments worthy of note under the heading of “structure”? One is the negative endorsement of the noble Lord, Lord O’Neill, who said that at least it was an improvement on the G7, which he described as,

“serving little other purpose than to keep its member states’ civil servants busy”, and,

“an artefact of a bygone era”.

Twenty is better than seven and I suppose the G20 has the credential of representing 80% of the world’s GDP but, maybe negatively, it also represents 80% of global greenhouse gas emissions. Its membership consists of five from Europe, four from western Europe, four from Asia, five from the Americas and one from Africa. On any reasonable observation of that membership, that is pretty unbalanced. I wonder whether there would be a more sensible observation on the world’s economy if one or two more countries were included, perhaps developing countries or countries facing the sort of challenges that one finds particularly in parts of sub-Saharan Africa.

So much for the structure, what about the scope of the G20? Our letter, drafted by our chairman, said that,

“while the initial focus of the G20 was international economics and finance”, the scope,

“has broadened in recent years, with the forthcoming Summit including issues from healthcare to environmental sustainability, protectionist tendencies, migration movements, energy vulnerabilities and other factors affecting the health of world commerce”.

They had to do that in two days. I know there were Sherpas, but that is still pushing it, I would have thought.

The communiqué published after the summit—I feel sorry for the people who have to write these—again sums up the absurd breadth of scope of these summits. It said that,

“we will strive to create a virtuous cycle of growth by addressing inequalities and realize a society where all individuals can make use of their full potential. We are resolved to build a society capable of seizing opportunities, and tackling economic, social and environmental challenges”.

Who is not? That does not advance human knowledge and understanding very much. These observations about scope perhaps explain the most important difficulty for the G20, which is implementation and how it delivers on the decisions it makes. One of our witnesses—I forget who—said that the summit is,

“like going to a Cabinet meeting with no Prime Minister”.

I will not comment on current circumstances, but that does not seem a very promising start to an international meeting. To quote the noble Lord, Lord O’Neill, with whom I agree entirely, again:

“They put something on the agenda, and as long as there are a couple of nice statements about what is on the agenda, they think they have delivered”.

I shall give an example, taken from the leaders’ declaration published at the conclusion of the last summit. There were two or three paragraphs in the communiqué on displacement and migration, which I would have thought was quite a big subject, the main one saying:

“Large movements of refugees are a global concern with humanitarian, political, social and economic consequences. We emphasize the importance of shared actions to address the root causes of displacement and to respond to growing humanitarian needs”.

Presumably they then say to the Sherpas, “Get on with that, mate”. How on earth you deliver on anything as general as that is beyond me.

In our letter, we say that,

“there is no effective mechanism to follow up the implementation of agreements reached at G20 summits”, which take place in a different location every year with a different chair. Alan Wheatley, another of our expert witnesses, said:

“The G20 has no permanent secretariat. Seen through that prism, there is no permanent officialdom to act as a counterweight to any whims or fancies that the current chairman of the G20 may have”.

We need some objective assessment of these gatherings, which I am sure are hugely expensive and which I suggest have limited value. The noble Lord, Lord O’Neill, may give us a hint in this quote, which I very much agree with—perhaps more than he intended. He said,

“I think the UK, if handled correctly post-Brexit … should want to be more on the front foot about suggesting better ways of having a more effective global system. I think that it is really important that we do it”.

I certainly agree with that and I hope the Minister does too.

Photo of Lord Purvis of Tweed Lord Purvis of Tweed Liberal Democrat Lords Spokesperson (International Trade) 7:11 pm, 8th July 2019

My Lords, it is always a pleasure to follow the noble Lord, who brings not only his experience but his refreshing objectivity and common sense to both the committee and many of these debates. I want to agree with him on a couple of points and will address them from my perspective in a short while.

On the structure of the G20, while it is welcome that South Africa is a member, I also wonder why Thailand, Nigeria, Taiwan, Iran or Colombia, which have bigger economies, are not participating. Ultimately, however the G20 is constituted, it is clearly better for leaders of nations to talk than not to. It is better to attend and participate actively, rather than following the approach of the leader of Mexico, for example, who chose not to attend, or President Bolsonaro, who cancelled a meeting with President Xi because the Chinese were late. It is clearly also better to seek consensus on the global challenges facing the biggest economies and the largest proportion of the world population.

While I greatly admire the diplomatic dexterity in the drafting of the communiqué on some of the key issues, it is becoming harder and harder to secure consensus in many respects, because of the symptoms the committee had already identified in its report on shifting global patterns. The USA, Russia and, in many ways, China look much more towards a transactional diplomacy than a multilateral one. We could see that in the Prime Minister’s reference to maintaining support for the JCPOA—the noble Lord, Lord Hannay, or others may address that in this debate. Just this weekend, in referencing his regret about the coming apart of that, a former diplomat who worked for former Secretary Kerry in the United States said in very clear American terms that the US, all the P5 countries and all the EU agreed on this and it was the last time they agreed on anything. We can see this starting to unravel.

It is harder and harder to bring about consensus. That was seen on perhaps the biggest issue facing the planet. There was a distinct section on climate in the communiqué because the USA was distinct from the other 19 countries represented there. While other elements of the communiqué could well be warm, fine words, looking at those on cybersecurity or “Data Free Flow with Trust”, surely those in Putin’s circle would say that they are merely that—fine words. That said, the statement from the Prime Minister on the UK’s position is admirable, and the communiqué, and those from the Finance Ministers and others, covering women’s empowerment, tourism, innovation, digitisation, artificial intelligence, agriculture and development, are commendable. This is where I agree with the noble Lord, Lord Grocott. The question asked of the Prime Minister by the noble Lord, Lord Howell, was: how will we ensure follow-up? There was an even more specific example in the communiqué on anti-corruption. It said:

“We will intensify our efforts to combat foreign bribery and to ensure that each G20 country has a national law in force for criminalising foreign bribery”.

How does the G20 ensure that? I would be grateful if the Government could respond to the question asked by the noble Lord, Lord Howell.

During our hearing in the committee, I pursued a question to the noble Lord, Lord O’Neill, one of our excellent witnesses, on whether a grouping such as the G20 is as effective as coalitions of the willing, given the current global political climate and the likelihood that it will be with us for the next decade, or perhaps for the remainder of the period covered by sustainable development goals? We saw one example on the Global Fund. There are many other examples of countries large and small, developed and developing, that come together for specific objectives being more effective than a slightly more arbitrary group of large economies parcelling out, south to south, countries or developing countries to themselves. The UK will need to be a driving force in establishing many of these coalitions of the willing. It is going to be one of our major opportunities and a challenge for the world.

Finally, something that really concerned me about the communiqué’s otherwise commendable language was the between-the-lines interpretation I took from it that Africa is still seen purely within the development framework. Africa, the most dynamic continent, with a young and fast-growing population, was still seen almost entirely through the prism of development. It was jarring to see no reference to the world’s largest free trade area, which is currently being formed. It has taken 20 years to negotiate, but the African continental free trade area has enormous global potential, not just for the UK but for all its partners in the developed world. If we continue to see Africa only through the prism of development and not as an opportunity, the other warm elements of the G20 communiqué will not be implemented. That is the opportunity for the UK to take the lead going forward.

Photo of Lord Hannay of Chiswick Lord Hannay of Chiswick Crossbench 7:17 pm, 8th July 2019

My Lords, this debate could and perhaps should have taken place a little earlier—ahead of the G20 meeting—but at least we now have the benefit of knowing the outcome of the meeting, and can make some assessment of it. It has been most excellently introduced by the noble Lord, Lord Howell, whose rotation off the chairmanship of the International Relations Committee is deeply regretted by all its members, myself included.

Our letter to the Prime Minister noted that the G20 was falling short of its earlier promise when it helped to handle the aftermath of the world financial crisis in 2007-09. Has the Osaka meeting changed that judgment? I do not think it has. It is still falling short of its ability to deal with a whole range of issues which are crying out for effective collective action—including, most prominently, trade policy and climate change—but that does not mean that we could do without the G20. To coin a phrase, if it did not exist, we would need to invent it, bringing together as it does the countries with 80% of the global economy, and bridging the divide between fully industrialised countries and those that are still developing. The G7, which has only industrialised countries, is not a substitute for that.

We should have no illusions about how alarming the situation on trade policy currently is. A whole range of unilateral, illegal protectionist measures initiated by the Trump Administration are shaking to its foundations our open-trading system, which has brought such benefits over the past 70 years. This is the most immediate and most fundamental challenge to what we frequently refer to as the rules-based international system, which it is in our national interest to support and strengthen. The Trump/Xi meeting dealt with some trade issues, but let us not kid ourselves. It was not a ceasefire, as it has been described by rather gullible journalists. It merely avoided making a bad situation a lot worse. What action are the Government taking to reverse that trend towards protectionism? What will be done to ensure that the World Trade Organization’s dispute settlement procedure does not collapse in a few months’ time as a result of the US refusal to appoint new adjudicators or panel members?

On climate change too, the result was certainly sub- optimal, but the commitment of 19 of the 20 participants to the Paris accords was, in my view, better than accepting the weasel words that the US would have preferred. The great challenge that lies ahead is in implementing and strengthening those Paris accords, inadequate as they certainly are, and that lies ahead, but I would like to know what strategy the Government have for doing better when the UN Secretary-General calls together a summit meeting on climate change this autumn.

I have two final points. Others have made the point that it is necessary to find some way of monitoring progress in fulfilling commitments in the periods between these annual meetings. I would like to hear what the Government think can be done about that. Suggestions have been made about the IMF or the OECD doing it; there are perfectly good ways in which participants could be brought up to the fact that they are not actually doing very much to fulfil the warm words they agreed at the last meeting. Secondly, I give three cheers for the successful conclusion of the EU-Mercosur agreement, which was announced during the summit, even though that achievement looks set to become yet another piece of Brexit-related collateral damage if the two aspirants to the Prime Minister’s post get their way and take us out of the European Union by 31 October.

Photo of Baroness Anelay of St Johns Baroness Anelay of St Johns Chair, International Relations and Defence Committee 7:23 pm, 8th July 2019

My Lords, I thank my noble friend Lord Howell for introducing this short debate with his customary careful analysis, and pay tribute to his three years as the first ever chairman of the International Relations Select Committee. His expertise established it as a respected committee of this House and it is a privilege to follow him as its chair.

The G20’s convening power brings together the leaders of some of the world’s largest economies but, as the noble Lord, Lord Purvis, pointed out it is not perfect in its list of 20. That still makes it an important place for the UK to use an opportunity to promote a values and rules-based agenda. Like the UN, the G20 can be a deeply frustrating forum. The pursuit of multilateral co-operation within a grouping of Heads of Government who might justifiably give priority to their national interests means that it will always be tough to make real progress on crucial issues. The exception was of course about 10 years ago, when it came together over the sub-prime crisis. What is my noble friend the Minister’s assessment of the impact of the pursuit of national interests at Osaka on the progress that can henceforth be made on two of today’s issues, which I hope he agrees are crucial to the UK: global warming and, as the noble Lord, Lord Hannay, said, the reform of the WTO? How will the UK be affected by the progress, or lack of it, on both matters at the summit?

Before travelling to Osaka, the Prime Minister pledged that she would introduce a legally binding target forcing the UK to end its contribution to global warming by 2050. At Osaka, she urged other G20 countries to set similarly ambitious net zero targets but the summit declaration falls far short of that. It does clarify that those countries which still stick by the Paris agreement will continue to work towards implementing their pledges—it does not say how. But then paragraph 36 sets apart the position of the United States in refusing to change its mind over its withdrawal from the Paris agreement,

“because it disadvantages American workers and taxpayers”.

Did the Prime Minister discuss climate change with President Trump while in Osaka? If so, was that in a bilateral meeting or in general discussions, and what was his response? Indeed, had the Prime Minister discussed such matters during the President’s successful state visit here earlier this summer? As my noble friend Lord Ahmad said on the matter that was discussed in this Chamber just before our short debate, we have a deep, special and enduring relationship with the United States. We can disagree but still be firm friends; we can strongly disagree and still be firm friends, so let us hope that continues.

Was global warming discussed at the Ministerial Meeting on Energy Transitions and Global Environment for Sustainable Growth on 15 and 16 June at Karuizawa? Which UK Minister attended that meeting, and what is the Government’s assessment of the progress made and its importance for the UK? Does the Minister agree that the eight ministerial meetings which take place separately from the summit itself play a part in the effective functioning of the G20, and can give the UK an important opportunity to ensure that issues vital to the safeguarding and furtherance of UK interests are discussed in some detail?

I note that in the DIT Oral Questions on 6 June, the Secretary of State for International Trade gave a commitment to support WTO reform at the G20 Trade Ministers’ meeting that was scheduled to take place later that week in the city of Tsukuba. The trade ministerial statement is referenced in the summit declaration, but it merely restates what the two problems are without demonstrating any agreement about how to solve them. As the noble Lord, Lord Hannay, said, the two problems are: paralysis within the dispute resolution mechanism, caused by the US blocking the appointment of new judges; and the need for a further round of market liberalisation which is WTO-consistent. Does the Minister see any realistic chance of resolving those problems at the 12th WTO ministerial conference, which is scheduled for June next year? After all, when we leave the EU, with or without a deal, the effective functioning of the WTO will be even more vital to us then than it is now.

We inhabit a global society and a global economy. Clearly, the G20’s role and functioning are not perfect and could be strengthened. But forms of global governance are needed now more than ever and it remains the case that an imperfect G20 is still better than none at all. As the Prime Minister said in her statement at the summit:

“Genuine collaboration and dialogue are particularly critical now as we confront serious threats to global stability … we are stronger when we work together”.

Photo of Baroness Greengross Baroness Greengross Crossbench 7:28 pm, 8th July 2019

My Lords, one important aspect of the G20 meeting was the leaders’ commitment to promote preventive action across the life course, which is vital in our ageing societies.

We know that, in better-off countries, at least 16% of years lived with disabilities are largely preventable—according to research by the International Longevity Centre UK, which I am privileged to head up—so interventions that aim to achieve this are of the utmost importance. As demographic trends continue, research by the International Longevity Centre this year predicts that nearly 27 million years will be lived with a disability, leading to tremendous losses to well-being and productivity.

There is a clear need for health systems to include adults in middle and later life in health promotion programmes—regrettably, they are often excluded. Such programmes include: targeted screening; preventive medications; supporting people to adopt healthier lifestyles; vaccinations against communicable diseases, which sometimes, unfortunately, still have upper age limits; and supporting people more to manage long-term conditions.

We need to further promote the inclusion of preventive interventions across all ages in national health systems. I hope the Minister ensures that the Government make this a reality in this country. Evidence has shown that preventing disease, and limiting long-term impairment and the compounding impact of multiple diseases, are both good for our health and will play an important role in supporting the economic sustainability of health systems. The long-awaited UK prevention strategy will need to deliver on this commitment, and I hope the Minister assures the House that it will.

Photo of Lord Judd Lord Judd Labour 7:31 pm, 8th July 2019

My Lords, first I applaud the work of the noble Lord, Lord Howell. I have the good fortune to know him quite well, since our days as young politicians on different sides of the House in the other place. We worked quite closely together in a group that dealt with world issues and particularly Anglo-American relations, the Middle East and Africa. Those were good days, and I have always respected his wisdom and judgment. They were again evident in the debate today, and we all want to thank him for the contribution he has made.

I found the attendance by the Prime Minister, both at the Council and the G20, a sad picture to witness. It was hollow, as everybody looked over her shoulder to see what was going to come next in Britain. The noises coming from the debate between the two principal candidates for the premiership are far from reassuring. The challenge to Britain is to rejoin the world, be part of the world and play a constructive part in world affairs. What have we heard about this in the debate between the two candidates? Instead, we have heard hollow and rather disturbing populist statements playing to the gallery in the short term, but with no vision, sense of statesmanship or sense of how great the challenge is. This is not a good time for Britain.

Coming to the occasions themselves, I was also saddened by the declaration by participants at the G20 in the paper they issued after the meeting. We have been having debates in this House and Parliament as a whole about the overwhelming importance of climate change and the challenge it poses to humanity. We are all doubly conscious of our responsibilities to future generations. We all fear lest we betray those future generations if we do not give the right priority to tackling climate change—and of course, climate change is central to the management of the world economy. However, what do we find? We find in the G20 leaders’ declaration that climate change appears in paragraph 35. That seems to be an indication that the issue clearly lacks the priority that it should have.

Similarly, migration is a symptom of a world in turmoil and full of challenges, but it is also an issue of how we ensure global stability and security, because large migrant populations and large numbers of displaced people are hardly a way to build a secure and fulfilling world. However, what do we find? We find this mentioned in paragraphs 41 and 42 of 43 paragraphs in the document. Where is the sense of priority? The clear message I want us to send to our leaders from this debate is that we want real priority established in international relations for the issues which concern us, such as migration and climate change. We therefore want leadership which is determined to be second to none in saying that Britain belongs to the world and wants to share the burden of responsibility for managing world affairs. An inescapable issue for us all is that the countries of the world are entirely interdependent. We shall be judged in history by the success we make of meeting that challenge. As the noble Baroness, Lady Anelay, has just said, it is by working together that we can make a responsible contribution to the future.

Photo of Lord O'Neill of Gatley Lord O'Neill of Gatley Conservative 7:37 pm, 8th July 2019

My Lords, it is a pleasure as well as an honour briefly to speak in this debate. I congratulate the noble Lord, Lord Howell, on securing it and join others in commending the tremendous work that he has conducted in his committee. I can only hope that his example is taken up in the commitment of others and that, in the spirit of some comments already made and a couple that I shall now reflect on, it pushes our country on to be more thoughtful and bold on the global stage.

I want to make six brief points. First, the G20 meeting in Osaka took place against a background of many high-frequency indicators suggesting an ongoing slowdown in the world economy. Four out of five indicators that have a particularly good cyclical track record are all softening: Germany’s Ifo leading indicator, as it is known; the US ISM survey of manufacturing; the sub-components of that same index for new orders and inventories; and Korean exports—South Korea is the first country to report its export data every month and does so on the first day of the month referring to the month before. The data for June, published a week ago, show a sharp weakening in exports—a bellwether of what is going on in world trade. The fifth, US weekly jobless claims, is the only indicator that continues to be strong, but if the others carry on in the same way, that will soon no longer be the case.

Secondly, fortunately the G20 statement did acknowledge downside risks to the world economy, which was a relief, not least given that that was its original expertise. Of course, as we have heard, the Trump announcement of a truce—for now—in the trade war with China was also a relief. However, as others have commented, it is not clear that there was anything at the G20 meeting, with the possible exception of increased expectations, yet again, of policy burdens falling on major central banks to do more to help economic growth. That in itself, in my opinion, is a growing concern, as it is now becoming almost an addiction.

Thirdly, as said quite correctly by others, the G20 itself is the most representative body to deal with the many complex social challenges of the world, as well as the macroeconomic ones we have heard some reference to. Indeed, I applauded its emergence way back in 2008, seven years after I first wrote about the so-called BRIC concept, in an article that actually tried to show that we needed a much better form of global economic governance, even if it would be more complicated. With the G20, in principle, we have it. It is much more sensible, as I believe others have mentioned, than the very outdated G7, but it needs to start doing something.

Fourthly, as we see in many of the paragraphs in the leaders’ statement, it is not clear that the G20 is doing anything any longer beyond publishing statements of recognition and showing awareness of what much of the world is talking about. Beyond accounting for itself more regularly, perhaps a separate problem is its sheer size. A couple of noble Lords commented on the exclusion of certain obvious countries, but another part of the problem, which the noble Lord, Lord Grocott, talked amusingly about, may be that there are too many. I have long believed that within the current G20 perhaps we need, separately, a new G7, which would, in my opinion, definitely include China, probably India, and perhaps Brazil and Russia, and then, of course, the US and Japan and, instead of many individual European countries, the EU.

Fifthly, noble Lords will notice that I did not mention the UK. The UK would understandably want to be part of such a narrow group, if such circumstances ever came around. Given our history and what we have still in principle in terms of values, we could be an eighth; but we need to demonstrate that we have something powerful that would help the world move forward and become a better place. That in itself partly relies on the Government having a clear and powerful vision for post-Brexit Britain and the world.

Sixthly and lastly, I want to end specifically on the topic of antimicrobial resistance, or AMR, which luckily no one else has yet mentioned. I was relieved that paragraph 33 referred to this huge challenge and I remain proud that the review I chaired under David Cameron played its part in getting the topic on the agenda in 2015, with increased focus in 2016. I take this opportunity to pay tribute to the dedication of a number of civil servants who I know worked tirelessly to ensure that this statement appeared. I am irritated, and to some extent alarmed, by what I have picked up about the attempts by some G20 countries to downplay the focus on this issue, including some that claim to share the UK’s championing of this issue in recent years. This in itself highlights, as could many other examples, the weakness of the current G20 operational style: G20 leaders need to urgently change this game-playing approach. In this instance, the so-called market failure in the market for antibiotics is getting dramatically worse. The solutions my review highlighted have been broadly supported by many of those few who analyse these things, but as of yet, we just have words: no incentives or moneys are coming from the G20 or the pharma industry. As we showed getting on for three years ago, if we do not address this, along with the other challenges that need to be met, we will have 10 million people a year dying by 2050. The G20 needs action and not just pleasant words.

It is also important that our next Prime Minister, whoever it is, the Chancellor, Foreign Secretary and the rest of the Cabinet get back to start talking about these things powerfully and regularly, as they have done in the past—not least, as one of the many symbols they could give of what global Britain actually is.

I will finish, and I apologise for going over by 30 seconds—

Photo of Baroness Stedman-Scott Baroness Stedman-Scott Baroness in Waiting (HM Household) (Whip)

Perhaps the noble Lord could bring his remarks to a conclusion.

Photo of Lord O'Neill of Gatley Lord O'Neill of Gatley Conservative

To echo the words and spirit of the noble Lords, Lord Howell and Lord Grocott, it is exceptionally important that the UK be on the front foot at the G20, with thought and serious attention. As a final thought in the spirit of the interesting comments of the noble Lord, Lord Hannay, perhaps the UK can itself outline ways in which the G20 can start monitoring and measuring what it says at meetings.

Photo of Baroness Northover Baroness Northover Liberal Democrat Lords Spokesperson (Foreign and Commonwealth Affairs) 7:45 pm, 8th July 2019

My Lords, I thank the noble Lord, Lord Howell, for securing this debate. I think he may have hinted at a case against the G20, although he then concluded in the other direction, so perhaps we did not need a debate at all. The noble Lord, Lord Grocott, certainly seemed to hold this position.

This was Theresa May’s last summit as PM, and it also reflected Britain’s position as half in and half out of the EU. The Minister will know that we on these Benches deeply regret the intention to leave the EU. Besides the economic damage we would do ourselves, the noble Lord will also be acutely aware, I am sure, of our consequent decline in global influence, which the noble Lord, Lord O’Neill, referred to. He will have registered exactly what our global partners think about our current path.

On leadership, the noble Lord, Lord Grocott, referred to the notion that the G20 was like a Cabinet without a Prime Minister. This perhaps reflects a changing balance in the world. Whatever criticisms were thrown at the US in the post-war years, until now it did seem to speak for democracy, liberal attitudes and human rights—something that the current President has no interest in doing. Its leadership may have grated on some, but maybe we will miss it when it has gone.

As China displaces the US, we have a US President who promotes “America First”. Others follow, as we see with Bolsonaro in Brazil. Nationalism and populism endanger multilateral engagement. Of course countries look after their self-interest, but the terrible bloodshed of the 20th century reinforces the fact that there needs also to be a recognition that some problems require global partnership—a point made by the noble Lord, Lord Judd.

Two issues that need to be tackled globally were on the agenda of the G20, climate change and trade—whatever else may have been listed there. I commend President Macron for his lead in ensuring that 19 out of the 20 reiterated their commitment to the Paris Agreement. That still matters. The separate paragraph on the supposedly “negative economic impact” of the Paris Agreement on “American workers and taxpayers” makes it crystal clear who is out of line here.

Then there is trade. The global effect of the trade war between the US and China shows how interlinked we are. The noble Lord, Lord O’Neill, has just warned us of the signs of a global slowdown. China and the US reached a tentative truce. President Trump also decided to allow US companies to sell to Huawei. Christine Lagarde, however, emphasised that resuming trade talks is not enough and that the tariffs already implemented were damaging the global economy.

The G20 also agreed that the WTO needed further reform, particularly in dispute resolution. Brexiteers might wish to look closely at what we may have to rely on if their wishes come true. They might also wish to note that Mercosur and the EU finally reached a trade agreement 20 years after trade talks began. My noble friend Lord Purvis rightly notes the absence of consideration of the free trade area in Africa. I might ask the Minister whether the UK is encouraging the inclusion of countries from Africa in the G20—but I think that the UK has little influence, so perhaps it is not relevant even to press that.

Other important issues came up, as the noble Baroness, Lady Greengross, and the noble Lord, Lord O’Neill, mentioned. Mrs May held her first meeting with President Putin since the Salisbury attacks, after he had given a most helpful interview to the Financial Times about how liberalism was now obsolete. I am sure that his citizens agree. Then, of course, we look to the next G20 summit, which is due to be hosted in Saudi Arabia—despite the recent conclusion of the UN special rapporteur on the Khashoggi case. She wants to ensure that the G20 does not “become complicit” in this international crime. Can the Minister comment?

Noble Lords point to how the G20 is falling short, as the noble Lord, Lord Hannay, put it. But surely he, my noble friend Lord Purvis, the noble Baroness, Lady Anelay, and others are right that the G20 meeting shows the continuing importance of multilateral engagement in a polarising world—even if the family photos had some strange and difficult family members among them. I look forward to the Minister’s response to this interesting commentary on an imperfect body.

Photo of Lord McNicol of West Kilbride Lord McNicol of West Kilbride Opposition Whip (Lords) 7:50 pm, 8th July 2019

My Lords, every speaker in tonight’s debate has touched on the chairmanship of the noble Lord, Lord Howell, and the letter that he sent to the Prime Minister in June. In preparing for tonight’s debate I was going through the letter, highlighting the bits which were of interest, and I highlighted virtually all of it. It would be of interest to know whether there was a response from the Prime Minister to the noble Lord’s letter of 13 June and, as has been touched on by many of the speakers tonight, to the important issues that were raised in it.

Also in preparation for tonight, I looked at the declaration. Its language, which many noble Lords have touched on this evening, reminds me of a number of manifestos that I have seen over the years. The question that arises from it, which has been raised by the noble Lord, Lord Purvis, my noble friend Lord Grocott and other noble Lords, is: how is the delivery monitored and kept an eye on as we progress? Perhaps the Minister could touch on that.

The UK was once a great champion of values and principles on the global stage, and the difference between the G20 only a decade ago and our position in the world now could not be starker. The Osaka summit showed how the UK’s role has, sadly, become greatly diminished.

On the issue of climate change, in the coming decades this must be a priority for each of us; we owe it to our children. Since recently adopting Labour’s policy of net zero emissions by 2050, surely the Government realise that the UK must now persuade other states to do the same. The UK alone cannot avoid the greatest threat that our planet has ever faced. With France also now working towards net zero, I hope that the international community can build momentum and quickly make net zero the norm. While it is encouraging that 19 of the 20 representatives reiterated their support for effective and speedy action on climate change, the omission of the US is increasingly worrying. As the noble Lord, Lord Hannay, and the noble Baronesses, Lady Anelay and Lady Northover, touched on, the UK must be the voice which puts climate change at the top of the agenda.

I worry that trade may have been an awkward topic for the Prime Minister. After all, in the background to the summit her likely successor as Prime Minister continued to insist the benefits of a no-deal Brexit and the consequential ripping up of every trade agreement which the UK is currently party to. I cannot imagine that the Prime Minister was in the best position to lay the foundations for future trade arrangements at the G20. However, looking towards a future whereby the next Government may be in a position to do so, most certainly, it should not be used to fund brutal conflicts—and on that, I come to our relations with Saudi Arabia. It is of deep regret that the UK has continued to arm the Saudi forces. Last week, the Court of Appeal ruled that UK arms sales to Saudi Arabia for use in Yemen are unlawful. Can the Minister confirm whether the judgment was raised during the bilateral meetings between the Prime Minister and the Crown Prince?

It was 10 years ago, back in 2009, that the UK last hosted the G20. As was my noble friend Lord Judd, I am reminded of the financial aid deal that Gordon Brown delivered at that summit and how, under the Labour Government, the UK led the G20 in a coming together of the world to face the great challenges of the day. It is in that exact spirit that the UK should and could lead the world in overcoming the great challenges we face now: climate change, the global migration crisis, rising concern about nationalism, populism and protectionist Governments, and the enormous inequality across the globe.

I regret that, when looking at Britain in the world today, many will see a country shying away from the global stage and failing to build the relationships we will need if we are to solve the problems of the future.

Photo of Lord Young of Cookham Lord Young of Cookham Lord in Waiting (HM Household) (Whip), Lords Spokesperson (Cabinet Office) 7:56 pm, 8th July 2019

My Lords, I begin by thanking my noble friend Lord Howell for securing this debate on an issue most critical to our national interest, and for his speech introducing it. I join others in paying tribute to his chairmanship over many years of the International Affairs Committee, which has produced a number of influential and at times challenging reports for the Government. He managed to hold his committee together to produce them and has always introduced them with the eloquence and perception we have grown accustomed to. We thank him for his work on that committee and wish his successor, my noble friend Lady Anelay, all the best.

My noble friend raised a number of issues that were not raised at the summit, and I propose to stick strictly to the Question that he asked, which focuses on the,

“outcomes they judge to be of most importance for the safeguarding and furtherance of Britain’s national interests”.

Perhaps I could write to him about the opportunity to raise issues about China and Japan, which he mentioned in his opening remarks.

Several noble Lords were critical of the language used in the communiqué and about the whole structure of the G20, and I understand that, but one needs to put this in perspective, as did my noble friend Lady Anelay and the noble Lord, Lord Judd. The UK has always understood that our security can be upheld only by collective endeavour, our prosperity can only be advanced by co-operation across borders, and our success as a nation depends not just on a stronger economy at home but our role in the world and the partnerships we build. That is why we are members of a number of multilateral organisations, including the UN, the G7, the G20, NATO, the Commonwealth—in which my noble friend has played such a prominent part—and the international financial institutions. They are all crucial to our ability to maintain and extend our reach and influence in the world.

I think it was the noble Lord, Lord Purvis, who referred to the fine words in the communiqué: fine words, yes, but very worthwhile objectives. We can reach such objectives only if we work with colleagues in other parts of the world through the sorts of institutions we have been talking about this evening. Of course, they need to be improved, targeted and focused and I hope to say something in a moment about monitoring, a theme that has emerged from our debate this evening.

In Osaka, the Prime Minister worked hard to bridge the differences between the G20 countries on some of the biggest challenges facing our nation: international trade, climate change, global health and preventing terrorist use of the internet. Discussions in Osaka were not always easy, but the UK made progress on each of these issues, which are important for safeguarding and furthering our national interest. I shall touch on some of them in a moment.

The Prime Minister welcomed the committee’s letter, which provided important perspectives ahead of the G20. She is in the process of responding to the questions it posed, building on her reflections from Osaka and previous summits; I have been assured that a reply is imminent.

As the noble Lord, Lord Hannay, said, the G20 leaders summit was formed to respond to the 2008 financial crisis. The rejection of protectionism and a commitment to an open global economy were key elements of the G20’s response. Yet, as noble Lords explained, trade tensions have escalated and trade restrictions and distortions are now in place, affecting hundreds of billions of dollars of trade. The WTO has forecast that the effects of a trade war could exceed even those of the financial crisis. So, my noble friend Lord Howell was right to raise in his letter these critical issues as areas of concern, especially at a time when we are negotiating our exit from the EU trading bloc, as the noble Baroness, Lady Northover, said.

We believe in open, free and rules-based international trade, as the noble Lord, Lord Hannay, mentioned. All nations must be encouraged to uphold these rules and open their markets if we are to build economies that truly work for everyone. That is why the Prime Minister made it clear that there are no winners in a trade war. We all stand to lose, and those on the lowest incomes stand to lose the most. We believe that any solution to the current tensions must have the multilateral system at its core. The system is not perfect and is in urgent need of reform; a number of G20 members, including the EU and Japan, have put forward credible proposals.

My noble friend’s letter mentioned concerns about the US Administration’s approach to the WTO. Working with like-minded partners, the UK will continue to encourage WTO members to engage constructively in the reform debate. In that regard, we welcome the United States’ submission of various proposals to strengthen the system and make sure that it is equipped with the tools needed to tackle present challenges, as well as its involvement in initiatives such as the EU-US-Japan trilateral group.

The G20 also expressed support for action to improve the functioning of the WTO’s dispute settlement system, which the noble Lord, Lord Hannay, mentioned, while the crucial issue of industrial subsidies is now firmly on the G20 agenda. On the dispute settlement system, we strongly support the informal process launched by the General Council at the WTO to seek a resolution to the appellate body issues. The proposals put forward so far by WTO members bring the right ingredients to many of the concerns raised. We urge all WTO members to engage constructively in the ongoing discussions.

Looking beyond the WTO, the G20 reaffirmed its commitment to strengthening further the global financial safety net with the IMF at its centre.

The noble Lord, Lord O’Neill, referred to the progress made on global health, particularly on AMR. I welcome the pioneering work of the noble Lord and Dame Sally Davies, as well as their continued efforts to keep this on the agenda for the G20. As the noble Lord mentioned, the latest estimates are that AMR currently accounts for 700,000 deaths annually; if we do not increase action, this figure is predicted to rise to 10 million by 2050—more people than currently die from cancer. There is a significant economic cost. AMR impacts on the economy through not just mortality and knock-on effects but increased health care expenditures and decreased livestock production. I will write to the noble Lord with more about what we are doing about AMR and why we are dealing with the market failure, which does not produce the antibiotic drug developments, vaccines and diagnostic technologies that we need. We are looking at a new model that identifies the right market incentives for research and development.

The noble Baroness, Lady Greengross, mentioned some of the wider imperatives on healthcare. The Prime Minister announced the UK’s new three-year funding pledge, averaging £467 million a year for the Global Fund. This will provide medication for more than 3 million people living with HIV, treatment and care for more than 2 million people suffering from TB and 90 million mosquito nets to protect children and families from malaria.

On climate change—which the noble Lord, Lord McNicol, mentioned—G20 countries have seen heat waves, floods and hurricanes hit with unprecedented frequency and intensity, contributing to conflict, state failure and illegal migration. Some 100 million more people will be pushed into poverty by 2030. Meanwhile, global efforts are not on course to meet the Paris commitments. If we take no further action, we are headed for a three-degree, and possibly well over a four-degree, rise in global temperatures and the dangerous impacts that would bring.

The message from the public is clear. Our citizens—particularly our youth, whose lives will be shaped immeasurably by climate change—demand action. Following the example of Greta Thunberg, hundreds of thousands of young people around the world have come together to demand greater action. As we heard in our debate, the G20 accounts for 80% of global emissions; its leaders have a critical role to play in reversing the trend.

As my noble friend Lady Anelay mentioned, we legislated earlier this month to reduce our net emissions to zero by 2050. My noble friend asked what we had said to President Trump. The Prime Minister was one of the first to speak to President Trump after his announcement in 2017, and she has had a number of conversations with him about it since. She has encouraged him not to leave the Paris agreement and continues to hope that the United States will honour it. Of course, it remains a disappointment that the US continues to opt out in an area of such critical global importance.

I shall try to deal with some of the issues raised in the debate. We take seriously and routinely monitor implementation of the commitments the UK makes in the G20. There are various mechanisms for monitoring implementation, including the G20 working groups, international organisations and independent organisations such as the University of Toronto, which compiles an annual compliance report. I am not sure it is desirable for a single international organisation to take overall responsibility for monitoring G20 agreements—it is probably best if the members do it themselves—but I take seriously the point raised about monitoring and will share that with the Ministers concerned.

I was asked how the G20 enforces the foreign bribery rules. Representatives from G20 countries meet routinely to track implementation of commitments made, and the G20 Anti-Corruption Working Group is responsible for the implementation of foreign bribery rules.

My noble friend Lady Anelay asked whether climate change was discussed on 15 and 16 June and which Minister attended. My honourable friend Thérèse Coffey represented the UK at the first joint meeting of the G20 energy and environment Ministers.

There was a discussion about non-G20 member states, and it is worth making the point that there are permanently invited guests such as the African Union, APEC and ASEAN. It is not the case that only G20 members have an impact on the discussions.

The noble Lord, Lord McNicol, asked about Crown Prince Mohammed. The killing of Jamal Khashoggi was raised and the Prime Minister made clear the need to have an open judicial system. She also raised the need for a political solution in Yemen, supporting the work of the United Nations and the special envoy.

I am conscious that my time is up—the screen is flashing—and I have not dealt with all the issues raised. I will write to noble Lords.

I conclude by saying that we have always understood that our success as a nation is tied to our collaboration with other countries and the relationships we build. As we leave the EU, the United Kingdom will continue to strengthen and draw upon our world-class diplomatic network and retain the same strong spirit of international co-operation and compromise that has long characterised our engagement with the rest of the world. This is the only way we can protect and promote our interests and ensure the prosperity and security of our citizens for years to come.

Today, the global system is under real stress. We must be honest in identifying problems and do more to work together to fix them. The UK has never been afraid to stand up for the global rules that underpin our values and our way of life—rules that govern our collective security, as well as the global economy. We must work flexibly to ensure that multilateral forums such as the G7 and G20 continue to function in a way that promotes genuine collaboration and dialogue, in order to confront the serious threats to global stability that we have heard about this evening.

House adjourned at 8.09 pm.