International Development

HC Deb 25 April 2002 vol 384 cc483-564

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Stringer.]

1.27 pm

The Secretary of State for International Development (Clare Short)

I welcome a debate that gives us a chance to review progress on international development and the United Kingdom's contribution to it. Since 1997, we have increased the time that the House of Commons spends discussing international development issues, both in Question Time and in the very effective Select Committee on International Development. I am keen to have annual debates, so that each year we can consider how the world is doing, what contribution we are making and where things are improving. We are moving towards that. There is definitely a growing interest in international development among hon. Members from all parties, and that is important and welcome.

No one can but argue that the issue of international development and poverty and inequality in the world is the biggest moral issue facing humanity, given that Organisation for Economic Co-operation and Development countries have enormous wealth and opportunity for education and health care. We can always call for improvement, but compared with the lives of our great grandparents, we live in enormous comfort and people are able to fulfil their ambitions, exercise their freedom and develop their talents.

One in five of all human beings who share this planet with us—1.2 billion people—still live in abject poverty. They have purchasing power equivalent to less than $1 a day, and that is not a measure of what a dollar would buy in a poor country, but in the United States of America. It is a minute amount of money Half of humanity live on less than $2 day.

We are living in an era of rapidly increasing global integration. People see more of one another than ever before because of the quality of communications that are now available. World population is urbanising rapidly. For the first time in human history more than half of humanity live in urban areas, and the projections are that over the next 15 years it will reach 65 per cent. Teeming slums of masses of poor people see television pictures of how the rest of us live. That is a recipe for conflict and tension. It should shame the rest of the world, given our knowledge, capital and capacity to promote development.

I have no doubt that this is the biggest moral issue that we face, but it is also enormously important for the future safety and sustainability of the planet. Such levels of poverty are often linked to failed and imploding states, the spread of conflict, and the spread of diseases such as HIV/AIDS, which is spreading across the world, multi-drug resistant tuberculosis, and much more pernicious and dangerous forms of malaria. Indeed, the area of the world in which malaria is endemic is increasing. There are also the pressures associated with refugee movements and people leaving their homelands. There are more refugees in the world than at any point in history, and most of them are hosted by poor countries. Moreover, great strains are being placed on the environment, such as growing desertification and over-fishing.

As I have said, this is the biggest moral issue that we face, but if we do not make quicker progress, the prospect of bitter divisions, more conflict, more instability, more environmental degradation and the spread of disease will threaten future generations, wherever they live. In Afghanistan, we witnessed the consequences of a failed state and the ability of pernicious movements to hide themselves there, endangering and threatening the future of the world, as well as the people of Afghanistan.

If we are not careful in doing better by Africa, we will have virtually a failed continent on our hands. That would cause enormous suffering to the people of Africa, but it would also endanger the future safety and security of Europe. Africa is our near abroad; the distance from the south of Spain to the north of Africa is less than 20 miles. If Africa remains in its current condition, the human suffering will be appalling, and the future of our two continents will also be put in great danger.

Mr. John Randall (Uxbridge)

I pay tribute to the work that the Secretary of State's Department is doing. On broken states, she will doubtless be aware that there are more than 700,000 registered refugees and displaced persons in Yugoslavia, Serbia and Montenegro. What can we do within our own continent to try to ameliorate that situation?

Clare Short

The hon. Gentleman is right, and programmes are in place in all former communist countries to help them make the transition to a democratic market economy. Of course, such countries have to adjust their systems of government. We are trying to bring stability to the Balkans by helping the countries concerned to build up their systems of government, so that they can grow their economies, care better for their people, and get refugees resettled. We are committed to all those tasks, and we are working as effectively as we can to achieve that objective.

The question arises of the suffering of those who originate from Serbia and Montenegro, but the pressure of refugee movements from eastern Europe to western Europe has played into the hands of those who have tried to incite far right, racist politics in western Europe by putting the blame on the many refugees who have settled there. Doing what is right and doing what is in our self-interest are not in conflict they are entirely complementary.

On present trends, Africa is getting poorer, and much greater efforts must be made to help—a point to which I shall return shortly. In the past five years, we have worked hard to improve the effectiveness of the international development system, which is full of conferences and grand declarations. If even a minor proportion of the declarations made and agreements reached at various conferences had been implemented, the world would be in better shape. We have tried to hone the international system, so that its objectives can be focused on much more clearly, and to secure collaboration with the World Bank, regional development banks and the UN system. That is preferable to the funding by various organisations of lots of separate initiatives and projects, which uses up much of the administrative capacity of the organisations themselves, and of the Governments whom they seek to support.

We have made considerable progress. Our first White Paper made it a target to get the international system agreed so that we could all work together to implement the international development targets. At the millennium assembly—which was attended by more Prime Ministers and heads of state than had ever before assembled for a single event—the world agreed to seek to secure the millennium development targets, as the international development targets were renamed.

One of those targets is to halve, by 2015, the number of people in the world measured as living in extreme poverty in 1990. Meeting that target means that 1 billion people will have to make the journey out of extreme poverty. Other targets include getting all the children in the world into quality primary education, and reducing infant, child and maternal mortality. The latter requires improved health care systems and that people have access to clean water and better nourishment.

Last weekend, my right hon. Friend the Chancellor of the Exchequer and I attended the spring meetings of the World Bank and the International Monetary Fund. We have ensured that both organisations are focused on seeking to deliver those targets in countries around the world. They are also focused on measuring the reform programmes that they recommend to developing countries against progress towards the targets that have been set. Where once there were mixed messages and differing objectives, the measure of economic reform is now the systematic reduction of poverty and the provision of better services for people.

That is a very important consensus, and it is a new departure for the world. Historically, there have been lots of clashes between the World Bank and the UN system. Nowadays, there is much more collaboration and effective working together.

At Doha, we achieved agreement on the very important proposal that there should be a new round of trade negotiations to deliver better trading opportunities to developing countries. If we can deliver on that agenda, the result will be much fairer world trading rules.

Fairer trading rules will give developing countries a much better chance to grow their economies. Of Africa's total exports, 70 per cent. consists of unprocessed commodities. The payment that countries receive for such commodities is very low. Most of the added value for commodities such as cashew nuts, tea, coffee and chocolate is added on in Europe. As soon as African countries start to try to process some of those commodities they hit all sorts of tariff walls and escalations. On chocolate, for example, those tariffs and charges add up to 100 per cent. of the original cost.

The present trade rules almost amount to a conspiracy to keep Africa underdeveloped. Better trading opportunities will give African countries a better chance to grow their economies and create jobs. At Doha, we agreed a framework to deliver those better opportunities, but the task of ensuring that they are delivered will be considerable, and will require much attention.

Dr. Jenny Tonge (Richmond Park)

I wholeheartedly agree with what the Secretary of State is saying, but how does she intend to get developing countries better represented in the World Trade Organisation? Time and time again, those countries are failed by their lack of representation, and their lack of capacity and expertise in these matters.

Clare Short

The hon. Lady is right. We need improvements, but some of the criticism of the WTO at the time of Seattle was terribly misinformed. The WTO was born out of the most recent Uruguay round of trade negotiations. With its inception, the world moved forward to adopting a trade system based on rules and membership. Before that happened, the big trading blocs negotiated with each other in such trade negotiations, and the developing countries tended not to have a strong voice. Although it was of course right to bring down the protectionist barriers erected in the 1930s, the result was that developing countries were squeezed out of the negotiations.

Since the WTO was established, more than 140 countries—including China—have decided to join. Developing countries, therefore, make up the majority of the WTO's membership. That creates the possibility of them getting together and negotiating as a group, and thereby getting more fairness into international trade rules. That is how we got to Doha, but the problem remains that some of the poorest countries do not even have an ambassador in Geneva. We and other countries are working with the Swiss to set up a secretariat for those countries—an organisation with pooled resources that will enable them to be properly represented.

In addition, the UK has taken a leading role in the establishment of what might be considered a type of law centre, giving developing countries access to advice from trade lawyers. Such lawyers tend to be enormously expensive, but we now have a joint facility giving the poorest countries proper legal advice, and that helps them to exercise their rights under WTO rules.

My Department also has a considerable programme of working with UNCTAD—the UN conference on trade and development—and others to strengthen developing countries' negotiating and trade analysis capacity so that they are more able to be clear about their self-interest and negotiate their self-interest in all trade negotiations. Trade has become enormously complex, yet it is crucial for the chance to grow economies. So we are making a lot of progress in that field.

I was very impressed in Doha by the performance of the developing countries. The countries of Africa moved together. As Latin America, Africa, Asia and the Caribbean have shared as well as different interests, they need to pool their interests and negotiate together to secure more from the OECD economies. That will involve us in reforming the common agricultural policy, which we would welcome, but is also important in the interests of developing countries.

Ms Julia Drown (South Swindon)

I wonder whether capacity is also relevant to debt relief. The early-day motion with the most signatures calls for more and faster debt relief. Is it the case that some of the poorest countries do not have the capacity to argue their side, which may be holding them back from getting more debt relief? I am thinking particularly of commodity prices—the analysis has not been strong enough to get the message through so far.

Clare Short

My hon. Friend is absolutely right. When the debt relief process started, many countries did not even know what they owed. There were bundles of bills in their central banks and a lot of work had to be done to tidy up and build the capacity for countries to manage their debt. We are engaged in work to build up countries' debt management capacity. It is quite right that countries should borrow responsibly and take out loans, but they need to manage their debt and ensure that they can afford to repay it.

I think that 26 countries have now qualified for heavily indebted poor countries status. Sierra Leone has just qualified, which is very good news. It is about to have elections and there are police across the country, which is a welcome development. However, there is a problem with the HIPC initiative. It had a formula for how much debt a country could afford in relation to earnings from its exports. Because commodity prices have dropped considerably and oil prices have gone up, many countries such as Uganda, which had already exited, are no longer sustainable under the formula. That was a matter of discussion at the World Bank meeting at the weekend. We will have to find extra resources for many countries to achieve sustainability. That is another argument for opening trade access. If countries are dependent on the export of a few commodities and prices fall, their economic development is called into question. All the countries that have been through the HIPC process have been helped to manage their debt for the future so that they do not get into these difficulties again.

The other very important meeting that took place a short time ago was the UN conference at Monterrey on financing for development. There was remarkable consensus between OECD and developing countries about the best kind of reform in which to grow economies to reduce poverty. It really is an extraordinary change since the days of the cold war. In the past, developing and developed countries would have found contentious, ideas such as encouraging the public sector to grow, having effective governance, regulating an economy responsibly and having better public services that are universal, but today there is agreement on the reform agenda across the world. That was one of the things accomplished at Monterrey. Again, there was a focus on implementing measures, not on arguing about what constitutes a desirable reform agenda.

Mr. Gregory Barker (Bexhill and Battle)

I totally agree with the right hon. Lady's analysis of the need to help Africa develop so that it is capable of producing more than just the most basic staple commodities. We need to reduce institutional and trade barriers for that to happen. We have our own part to play with the Commonwealth Development Corporation. Is the right hon. Lady happy though that, in the past two years for which figures are available, the number of investments that the CDC made in sub-Saharan Africa almost halved from 41 to 26?

Clare Short

I am happy with the way that the CDC is being reformed. Some of the criticism is grossly misinformed. Our proposals, which the House supported, were to reform the CDC so that rather than being a public sector investment institution, looking for low rates of return and with a limited investment fund, its expertise on investment in developing countries could be used so that it became more of a conduit for private sector investment in those poorer countries—places where the markets do not attract much investment at all. That meant selling on some of the businesses that it owned to local or other ownership so that they could continue to function, and trying to increase the rates of return to encourage the private sector to move into those countries.

Last year was especially difficult for the world economy. Most investment houses have reduced their estimate of the value of their investments because of the state of the world economy. That has affected the CDC, too.

We are engaging in a difficult reform. It is being watched by other public sector development investment institutions across the world. If we succeed, the institution will be enormously important. Inward investment will provide the means to achieve technology transfer, access to clean water, sanitation, electricity, modern communications and so on. The amount of such investment going to the poorest countries is still extremely small.

We should try to find another opportunity to discuss at greater length the progress of the CDC reform. The hon. Gentleman correctly expressed the concern of the House that we get that right, but I completely reject the criticisms, for example, those in the article in The Times, which were malicious and ill informed.

Rev. Martin Smyth (Belfast, South)

I share the Secretary of State's concerns, and welcome the definite co-ordination that is under way.

The issue relates not only to inward investment but to what countries can do for themselves. Does the right hon. Lady welcome the fact that the President of South Africa has at last acknowledged that AIDS and HIV must be tackled for the good of the country? On a negative point, does she share my concern about the latest threat in Zimbabwe? White farmers have been dealt with and action is now being taken against Indian traders. Surely, that will further impoverish the country.

Clare Short

I agree that the changes in South Africa—offering treatment to prevent mother-to-child transmission of HIV/AIDS and offering tests and anti-retroviral treatment to women who may have been infected after sexual assault or rape—are both right in themselves and will heal a bitter row that probably distracted the country from getting on with the task of preventing the spread of the infection.

HIV/AIDS is yet another burden for Africa. It has also spread considerably in India, and Russia has the fastest growth rate in the world, so it is wrong for people to think that the disease is a problem only in Africa, although it is more advanced there.

The good news is the achievement in Uganda, where rates of infection are down to 6 per cent. from the high 20s. There is a massive reduction in the rate of infection among young people. That shows what can be done and what needs to be done throughout the whole continent.

I agree that Zimbabwe is a complete tragedy. The economy is collapsing; there is negative growth, and hunger and poverty are increasing. The elections were flawed. The country should be an engine of growth in Africa. It has a highly educated population, good land and other resources, but the economy is being wrecked and the people are suffering terribly. We must hope for, and work towards, an end to its misgovernment so that the people of Zimbabwe have the chance for a better future.

I was describing the achievements of the past year and focusing on the world's efforts. At Monterrey, more official development assistance—aid—was committed by both the United States and the European Union after years of declining aid spend. That was a turnaround in the world's commitment to development and is a step towards the achievement of the millennium development goals.

The EU made a commitment that, by 2006, we would reach an average of 0.39 per cent. of gross domestic product. That means an extra $7 billion every year thereafter. The US made a commitment to an increase of $5 billion from the same date.

So that is good news. It is still not as much as the amounts that the reports commissioned by the World Bank and from former President Zedillo of Mexico said will be needed from the world in aid resources to reach the millennium development goals—that is, roughly double the assistance that is already given through the international system. However, the meeting reversed the decline that has taken place for many years in the international system, and that helped to make it an important success.

Dr. Tonge

I am becoming a little confused by the number of declarations, conferences and pledges on development that are going on around the world, so will the Secretary of State clarify a couple of points?

First, what is the relationship between the fund recently set up at Monterrey and the global health fund? I presume that they are completely separate, but is there any cross-over? Secondly, has the money merely been pledged or is it in a bank somewhere gaining interest that can be dished out to the countries that need it? I sometimes worry that such pledges remain just pledges, and may seem grandiose but do not really amount to much.

Clare Short

A fund was not set up at Monterrey—rather, the United States and the European Union committed themselves to grow their spending on aid. It was a commitment on future spending, so the money is not in the bank. The US has suggested that its $5 billion might go into a new fund that is run in a different way to USAID. The EU's pledge is to increase our spending through existing channels, not through establishing a new fund. So no, there is no money in the bank. There is a pledge and a commitment, and it will be our duty and that of others to ensure that the EU keeps to it. It would be a betrayal of the developing world to sign up to a radical reform agenda, and then to fail to keep our part of the promise.

The global health fund arose from the G7 meeting and from commitments made by Kofi Annan. There has been some confusion about whether it is only for HIV/AIDS—it is not—and whether it is the only instrument for getting more spending into the care of those with HIV/AIDS, malaria and TB, three illness that cause enormous ill health and suffering, and thereby economic loss, in developing countries. We in the UK have always seen the global health fund as a fund to provide drugs and commodities through which, by pooling resources internationally, we can achieve greater reliability of supply and lower prices, and then encourage developing countries to improve their delivery systems. As a country, we have pledged $200 million to the fund. We are already spending £1 billion on strengthening countries' health systems.

That is what the fund is for. Because Kofi Annan made a speech saying that we need an extra $10 billion a year to combat HIV/AIDS—he meant all forms of spending, including Government spending—everyone sees the global health fund as a failure, which it is not. It is in the final stages of appointing its chief executive, or whatever title the person is to have, and it has received a series of applications from developing countries on which it is about to make decisions.

The final UN international conference that is required to complete the architecture is the forthcoming world summit on sustainable development in Johannesburg, Rio plus 10. We have discussed that in the Select Committee. I hope that the prize that we will get from that conference is an overcoming of the division between the environmental lobby of the north, which tends to be cautious about promoting development because it believes that the world is under strain and cannot afford any more economic growth, and the view from the south that such an environmental agenda locks them out of development. I very much hope that we will get a real commitment to sustainable development at Johannesburg. We need to guarantee development for the poor, but in the context of a sustainable planet, and to bring the development and environmental lobbies together properly to promote sustainability, rather than a "do not disturb, do not develop" approach. If we can achieve that, we will have global agreement on how to drive the world forward.

Mr. Simon Thomas (Ceredigion)

The Secretary of State took part in an interesting sitting of the Select Committee on Environmental Audit on just this point. At the risk of sounding like a voice for the north, does she agree that it is important in the context of Johannesburg to transfer our technology to developing countries? That offers huge opportunities both for our domestic markets and for developing countries, which could be enabled to bypass some of the environmental degradation that we have undergone through the process of industrialisation. For example, we could take them straight to the future of electricity generation—embedded generation instead of huge grid connections.

Clare Short

Of course I agree with the hon. Gentleman that we should transfer not old technology but modern, more environmentally sustainable technology. However, we will not transfer technology on the scale that is needed. Half of humanity has no sanitation, and more than a billion people have no access to clean water, which means that their children constantly get sick because the water has been used for other purposes by other human beings. The need for investment in sanitation, water and energy is massive, and we will get that investment only if we can grow economies so that countries can afford more imports. They would then be able to afford the transfer of technology that occurs through trade and foreign direct investment. I agree with the hon. Gentleman that we must make sure that any transferred technology is state of the art, rather than old and polluting—that would be a terrible development.

The achievements of the past year which I have just summarised mean that the world now agrees on the agenda and on the best way to engage in reform. We need now to drive forward implementation and to improve the measurement of our progress in achieving development goals. The World Bank is calling a meeting in June to improve the collection of statistics and measurements across the world system, so that we can learn from the progress that has been made and find out which countries are not making progress.

At the meeting last weekend, the World Bank issued a report on progress towards the development targets. We are on track to achieve the targets to halve poverty, so we are set by 2015 to reduce by a billion the number of people living in abject poverty. That is partly because progress in China has been remarkable for the past 10 years or so. Progress in India and Bangladesh has been considerable, but it could be better, and we must remember that two thirds of the world's poor live in Asia.

We are not, however, on track in Africa—it is getting poorer. The population is growing faster than the economy. Africa is by far the poorest continent, and 50 per cent. of its people live in abject poverty. I repeat: it is getting poorer. Twenty per cent. of the continent's people are living under conditions of conflict. For example, the Democratic Republic of the Congo is hardly a state. It is an enormously resource-rich part of the world, as big as western Europe, but it lacks the institutions of a modern state and it is in desperate humanitarian need.

We have to do better in Africa, and we have two opportunities to do so. The first is through NEPAD, the New Partnership for Africa's Development, in which African leaders are coming together to say that they are determined to do better, to end the conflicts, to reform their states and run them better and to provide better services for their people. That gives us an opportunity to respond to Africa's own reform agenda. In the past the agenda has tended to be set in Washington and imposed on reluctant states, so it has been more likely to fail. The importance of NEPAD is that Africa is leading its own drive for development.

There is another major opportunity. We must concentrate on ensuring that Sudan, the Democratic Republic of the Congo and Angola all come to peace. According to World Bank estimates, the levels of conflict in Africa are costing 2 per cent. of economic growth to every country on the continent, including those that are not in conflict, simply because of the reputation of Africa, the difficulties of transport systems and so forth. If we can focus on bringing to peace those three massive, resource-rich countries, which straddle the continent and have been engaged in war for two generations, that really would improve Africa's prospects.

Mr. Andrew Robathan (Blaby)

As usual, I do not find that much to disagree with in what the right hon. Lady is saying, which is always slightly depressing for a Conservative Member. Does she agree, however, that NEPAD has resulted in marvellous words with which we all concur, but we need to see some concrete action from its leaders, particularly the President of Nigeria, who presides over an extremely corrupt state and yet has signed up to NEPAD's statement on the importance of good governance and accountability?

Clare Short

I agree very much with the hon. Gentleman. We must have implementation, but it is important that Africa is calling for reform itself rather than being hectored by others. I agree that lack of progress on reform in Nigeria is very worrying. In that oil-rich country, 70 per cent. of the population live in abject poverty, and all its systems are riddled with corruption and ineffectiveness. One in five of all Africans cannot go forward without Nigeria going forward, and progress has been very slow.

Nigeria is now in pre-election time. Some of the reforms in which Governments in developing countries must engage to run their economies better and provide better services to their people threaten vested interests and are difficult to implement. A wave of reform tends not to happen in a pre-election period, so I am worried that there will be still more delay before the reform agenda can be driven forward in Nigeria. Nigeria is in bad shape and we must do all we can to ensure that the reform effort moves forward so that the rich oil resources there are used for the benefit of the people and not just for the benefit of a corrupt elite while the rest go poor.

This is an important time of opportunity. There is more and more agreement across the world about what needs to be done and about the urgency of doing it, and more and more knowledge about what works in development. We now need to progress more sharply and rapidly with implementing what we have agreed. Extra aid is needed, but we need to use the existing aid better. Only half of the $55 billion that is already in the international system is spent in low-income countries. Much of it is used for foreign policy purposes or gestures or to procure trade for the giving country. If it were directed to the poor and put behind reformers, its poverty-reducing effectiveness could be increased by 50 per cent.

We have redirected the whole of the UK effort and untied our aid, but we need to drive that process forward across the world. As the House knows, the EC is a major sinner in this regard and is getting worse. We have worked for a reform agenda that is being put in place and that will improve the performance of the staff and the capacity of the organisation to spend money, but the way in which it is allocated has moved even further away from poor people, which is a disgrace. We are working hard, and we need parliamentarians across Europe to join in exposing this scandal and to establish a determination to do better.

That problem is the result of gesture spending and old alliances. Lots of resources go to Latin America, for example, where most of the countries are middle-income. They are the most unequal countries in the world, however, and they have lots of poor and excluded people. Those countries do not need aid resources; they need to use their own resources better to include all of their people, educate all of their children and provide work and opportunities to all of their people to improve their lives. We must therefore work to redirect the money available to where it would be most effective.

We also need to implement the commitments made at Doha. The European Union is about to negotiate regional trade agreements with all the African, Caribbean and Pacific countries under the Cotonou agreement. We need to keep an eye on that to make sure that the offers are generous and that they improve the trading opportunities of developing countries.

We must do better in terms of dealing with conflict. The Government have two mechanisms—a global conflict prevention pooled arrangement bringing together the Foreign and Commonwealth Office, my Department and the Ministry of Defence, and one for Africa that I chair. The bringing together of those three Departments and their expertise has really improved UK thinking about conflict resolution and conflict prevention. I am trying to focus sharply on bringing the three big conflicts to an end, which would transform the prospects of the continent. I hope that the House will watch that and try to give support. If the kind of international energy and quality of attention that went into the Bonn agreement for Afghanistan were put into the three conflicts in Africa, they could be brought to an end.

Mr. Hilton Dawson (Lancaster and Wyre)

Having recently visited Sudan, I agree absolutely with my right hon. Friend on the prospect for peace and the imperative for peace in that country. We commend the efforts that are being made to step up the diplomatic process and influence.

With regard to Angola, which I know my right hon. Friend has visited recently, will she explain further the role that this country could take to try to eliminate some of the desperate circumstances that some of us have seen there, particularly in internally displaced person camps? There seems at last to be an opportunity to get to grips with those appalling circumstances.

Clare Short

Angola has been at war since the early 1960s. It fought the Portuguese for its independence, and the Russians allied with the country, so it declared a one-party state and adopted a Soviet model of development. That led to support from then apartheid South Africa and the United States for UNITA, a rebel movement. A civil war has therefore been going on there ever since independence. Again, although it is a very rich country in terms of natural resources—it has masses of oil, diamonds and other rich resources—it suffers from desperate poverty.

The country has now come to peace, which is a very important opportunity, and it is sincere about wanting that peace to succeed. The UNITA fighters must be disarmed, demobilised and resettled, which is a considerable task. A third of the population of the country has been displaced in the course of the war—4 million people have been removed from their land, and the country is littered with land mines. The resettlement effort will therefore be enormous, but it should be an engine of economic development, given its richness in natural resources.

The UK does not have a big programme in Angola. We do not speak Portuguese and do not understand Portuguese bureaucratic systems—I am not sure how many people do; it is an intensely bureaucratic tradition. I am working to release resources from the Department to help to bring in the best advice on how to demobilise and resettle people, however, and I have offered to enable a team representing the Government and UNITA to come to Sierra Leone to talk to all the people engaged in disarmament, demobilisation and rehabilitation there, to learn the lessons. I had discussions at the World Bank meeting, and a mission is about to go to Angola to help with DDR.

Angola also has terrible problems of corruption, and the IMF programme there has gone off-track. I had discussions with Hans Kohler about looking again at Angola, as it is no longer a country in conflict but a post-conflict country. That does not mean that we should lower our standards on reform, but the effort is worth while. I shall probably contribute some expertise from the UK, too. Angola should be able to access international expertise to help to move its peace process forward.

Tony Cunningham (Workington)

I have a couple of points. We are talking about the Sudan, the Congo and Angola, but there are conflicts in other parts of the developing world. Although they may be at peace at the moment, the fact that they are not oil-rich or diamond-rich means that they tend to get neglected. Not too long ago, Ethiopia and Eritrea were at war. In one battle, something like 80,000 people were killed, but that did not even appear on page 17 of The Guardian. It was forgotten about because the countries involved do not have oil, diamonds and so on. Two of the poorest countries—they are both in the UN's bottom six—were wasting huge amounts of resources on fighting each other.

Does my right hon. Friend agree that we need to spend more time and effort on all the countries that are in conflict rather than just on those that are highlighted because of their natural resources? In addition to Sierra Leone, will she consider the success in Mozambique on bringing the former Renamo and Frelimo guerrillas together after the civil war there? That might be a good example for Angola.

Clare Short

I agree that we should bring wars to an end everywhere. I do not agree that the focus on Angola, Sudan and the DRC is coming from people who are interested in investing in those countries. Those countries are in such an appalling state that their natural riches are not being deployed to the benefit of their people. I do not therefore apologise for focusing on the Sudan, the DRC and Angola, as, if they moved to peace, it would transform the prospects of the whole continent.

My hon. Friend is right to say that the Ethiopia-Eritrea war was an absolute tragedy. It was fought out like the first world war with lots of young men thrown at each other and slaughtering each other over a barren piece of territory. There has now been an adjudication on the border, which both sides have accepted. There are no rich resources in that border area, and the war was completely wasteful and caused great loss of life and suffering, and was a setback to economic development.

I am hopeful about Ethiopia. Prime Minister Meles is a remarkable man. He is determined to bring reform to Ethiopia. It is one of the poorest countries, with a gross domestic product of only $100 a head. Some 62 per cent. of its children are chronically malnourished and many of those who do survive are stunted physically and mentally. Even if they get the chance to go to school, they will never be able to develop their natural talents. We desperately need a major reform effort in Ethiopia.

I agree that Mozambique is a great success. It is a very poor country, but has had 10 per cent. economic growth for many years. We need similar levels of growth in other countries in Africa if we are to halve poverty there.

Norman Lamb (North Norfolk)

I agree about the importance of focusing attention on those particular conflicts in Africa to get the economies growing again. However, does the right hon. Lady agree that it was counter-productive to increase substantially this country's arms sales to Africa over the past four to five years? I accept that countries have a right to defend themselves, but increasing arms sales, which are usually paid for by increasing debt, goes against sustainable development and the alleviation of poverty.

Clare Short

I have seen the claim about increased United Kingdom arms sales to Africa made in documents produced by non-governmental organisations. I am afraid that I have not checked the figures, but I think that they are largely explained by South Africa's big arms order. Let me make my position clear: properly procured weapons and equipment for properly and transparently managed armed forces are essential to achieve stability and order in the continent of Africa, so some arms sales are legitimate and right. However, there is much corruption in the arms industry throughout the international system. Indeed, Transparency International published a report on that today. Badly procured arms and wasteful expenditure often lead to bloated armed forces, which sometimes results in coups. That type of procurement is the last thing that countries need in order to develop.

Africa needs better, more disciplined, more transparently managed and properly equipped police forces, courts, judicial systems and armed forces. I am pleased that we have agreed to carry out a defence review with Uganda. People from the Ministry of Defence are in Uganda helping it to look objectively at the security threat that it faces, what equipment it needs and the size of its armed forces. It will be possible for it to manage its expenditure properly through public finances rather than secretly, which is how most defence expenditure is managed at the moment. I agree that the issue is important. We are making progress, but we need to make much more progress on supply and demand.

The world is grossly unequal and in danger, but we have an opportunity to make enormous progress. We have great clarity about what we need to do. All sorts of lessons have been provided to promote effective development and some countries are doing very well. Those examples need to be widened. If we also do better at resolving conflict, we could have a period in which countries make enormous advances. It is within the grasp of our generation to remove abject poverty from the human condition, which was only a dream for previous generations. That is an achievable objective, but it is not inevitable that we will be successful. If we are not, the world will become more unstable and more dangerous for us all, and no privileged country will be able to buy its way out of the trouble that will otherwise spread across the world.

2.13 pm

Mrs. Caroline Spelman (Meriden)

People are so weary of politicians carping about each other that I want to begin by congratulating the Government on holding this debate on the occasion of the publication of their annual report on international development. We asked for that during the passage of the International Development Act 2002, and although the amendment was rejected, we are delighted that it has been accepted in spirit. I think this is the first time that the publication of the annual report has given rise to an annual debate. All of us with a deep interest in international development appreciate the opportunity that that offers us.

I also thank the Secretary of State for letting me have a copy of the annual report at 3 o'clock yesterday afternoon. That certainly made a difference to my ability to prepare. However, speed-reading a document of about 136 pages is not the best way to achieve close scrutiny, so inevitably my remarks are based on a mixture of what I read in the document and what I have seen of the Government's work in practice.

On the positive side, last year we saw improved responses to international crises in Goma, Gujarat and Afghanistan. There is no doubt that the Department's emergency relief model is becoming more refined. We applaud the Department for that, and it is right to place that on the record. We also gave a warm welcome to the Home Secretary's decision to incorporate the Organisation for Economic Co-operation and Development convention on bribery and corruption into emergency legislation following the events of 11 September. We pressed for that to be part of the International Development Bill, and thank the Home Secretary for giving credit to the Conservative party for pressing for its inclusion.

There are many positive aspects to developments, but there are also some serious concerns. In the report, there is a deafening silence on the Commonwealth Development Corporation. I thank my hon. Friend the Member for Bexhill and Battle (Mr. Barker) for raising that in an intervention, and also my hon. Friend the Member for New Forest, East (Dr. Lewis), who secured an Adjournment debate in Westminster Hall on that very subject.

The Commonwealth Development Corporation was a model of its kind. It was established in 1948 specifically to encourage, through investment, small, mostly agricultural enterprises in the third world. What made it different was that there was never an expectation of a return on the investment of more than about 8 per cent. It was something good, something that worked, something that did not cost a lot of money, something that was constructive and something that had dignity.

So what happened? The Government abandoned the guiding principle of the concept to replace the scheme with a planned public-private partnership. Investment will move away from small businesses with low profits to be invested instead in more high-tech high-yielding enterprises with greater profits. As likely as not, those will he companies that could attract investment without any help from us. What madness!

After we debated that issue recently in Westminster Hall, I received a letter from a former employee of the CDC. Without wishing to exaggerate in any way the investment success of the CDC, he says: it has delivered numerous examples of sustainable agricultural businesses throughout Africa, which employ large numbers of rural Africans…CDC's withdrawal from this sector has resulted in large-scale redundancy programmes, declines in standards of management and business ethics, and an apparent investment void. He cites the example of a CDC-supported teak company that made 80 per cent. of its work force redundant in one of the poorest regions of the country before re-employing many of them on a casual basis and without the benefits that went with the CDC's terms of employment. He asks the question, and I echo it: is this development?

Clare Short

I find it extraordinary that the Conservative party has adopted a posture of supporting sub-optimal public sector-led investment that gets a rate of return to which the private sector would never respond. If the hon. Lady is saying that Africa and other regions in which the CDC operates can get investment only at that level, she is suggesting that the private sector will never invest in those countries and they will be marginalised from the globalising economy for ever. [Interruption.] I am not missing the point. If the CDC goes for a lower rate of return than the market would accept because it is not possible to make better investments in such countries, those countries will be marginalised for ever.

We have not wrecked anything. I suggest that the hon. Lady looks at the CDC's annual report, published a short time ago. Perhaps the Select Committee will decide to reconsider the issue. We obviously need to ensure that we get things right, but the hon. Lady seems to be making a Communist argument.

Mrs. Spelman

It is not just the Conservative party that is raising serious concerns about the CDC. If the right hon. Lady consults the Under-Secretary of State for International Development, who responded to the Adjournment debate, she will discover that not one Labour Member spoke in defence of the Government's actions. Indeed, the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) crossed the Floor to speak with the Opposition. The lack of support for the Government from any part of the House on that occasion should at the very least be cause for concern.

Hugh Bayley (City of York)

rose—

Mr. Barker

rose—

Mrs. Spelman

I will give way first to my hon. Friend the Member for Bexhill and Battle and secondly to the hon. Member for City of York (Hugh Bayley).

Mr. Barker

Does my hon. Friend accept that it may be right, as the Secretary of State says, to modernise the CDC, but that the right hon. Lady does not appreciate the huge leap implicit in going from a rate of return of 8 per cent. to one of 25 per cent? That cannot glibly be regarded as modernisation. It is a massive step change to get a return on equity of 25 per cent. Surely a much better model for Africa would be in the form of the old 3i corporation, which was seen as seed-corn development, pump priming where other equity will follow, with returns on capital of perhaps 15 to 18 per cent. either as equity or mezzanine debt. I speak as someone with venture capital experience, and I do not think that the Secretary of State grasps the nature of a 25 per cent. return on capital.

Mrs. Spelman

I thank my hon. Friend for that intervention. It shows the benefit of having the opportunity to debate what can be done to improve the present situation. My hon. Friend's expertise in venture capital was valuable when we debated these matters in an Adjournment debate.

The great difficulty is that the sort of returns that it is now the strategy of the CDC to secure are extremely difficult to achieve from agriculture. Agriculture is the bedrock of civil society in many developing countries. The loss of investment through the CDC in agriculture is extremely serious for many developing nations.

Hugh Bayley

I shall defend the Government's policy on the CDC. For the hon. Lady's argument—that it is a bad thing that the CDC is beginning to move away from its agricultural investments—to be convincing she would need to make the case that the CDC is a better source of finance for agricultural development than the Department for International Development.

The Department is increasing its investment in agricultural projects. As the hon. Lady has said, that is because they would not necessarily generate a commercial rate of return. Surely it is right to get each part of the development operation addressing the problems that it is best attuned to addressing.

Mrs. Spelman

The hon. Gentleman makes a revealing point about what may be at the back of the Government's mind in connection with the CDC's change of strategy. During the passage of the Commonwealth Development Corporation Act 1999, the former Member for Hertford and Stortford, Mr. Bowen Wells, made exactly the point that the root cause of one of the problems was innate competition between what the CDC could do and the work of the Department. At the time, that was strenuously denied by the Government spokesman. Perhaps the hon. Gentleman has brought out an underlying truth that needs to be addressed. There is still a fundamental problem, as many United Kingdom farmers know too well, which is that with a low rate of return in agriculture, it is difficult to secure the necessary investment for the essential modernisation of agriculture. Our deep concern is that opportunities are moving away.

Clare Short

I would welcome a debate. I hope that the usual channels are listening

Mrs. Spelman

I have had a hint from the Secretary of State that she might be prepared to allow another debate on the CDC in Government time. There may be an important reason for doing that. Is it not better, when something is going wrong, that we admit that honestly together and try collectively to work out how to put things right? Perhaps all hon. Members whose hearts are in this matter could contribute to a subsequent debate.

Clare Short

For the sake of clarity, I must point out that I do not have the power to allocate time. I would welcome the chance to debate the CDC; we need more informed debate. Some of the allegations are misinformed, but I am sure that they are well meant. We should find a way, either through the Select Committee, on the Floor of the House or elsewhere, to pursue the issues properly. I give that undertaking—but unfortunately, I cannot allocate time.

Mrs. Spelman

I am well aware that the usual channels have major control of how parliamentary time is allocated. However, the right hon. Lady has made a welcome suggestion. I am sure that, with the presence of the Chairman of the International Development Select Committee, my hon. Friend the Member for Banbury (Tony Baldry), a number of us can bring pressure to bear.

Tony Baldry (Banbury)

It may be for the convenience of the House to know that the Select Committee has a firm date in the diary to take evidence from the chairman and senior members of the CDC. I hope that that will enable the Committee to ask the sort of questions that the House would like it to ask.

Mrs. Spelman

I hope that the usual channels are listening to the calls on both sides of the Chamber for the opportunity to be given to us.

Dr. Tonge

My intervention has already been answered. I heartily concur with what the hon. Lady is saying. I know that many Members have reservations, as I did when the Commonwealth Development Corporation Act 1999 was passing through the House, and as did the previous Member for Hertford and Stortford, Mr. Bowen Wells. The Chairman of the International Development Select Committee has said that he will take the matter on board and have a thorough investigation. I am sure that the Secretary of State would welcome that, too.

Mrs. Spelman

I thank the hon. Lady for her support in our endeavours to secure an opportunity to rework things together. We shall all contribute to try to make that possible.

Without turning these proceedings into a mini-debate on the CDC, I wish to defend the individual who sought to give me his perspective of what is really happening in the organisation for which he worked for most of his professional life. The letter from the former employee was thoughtful, and should not be too quickly dismissed as having no relevance to this discussion about where the CDC is heading.

The ex-employee pointed out in a measured way that at least the old CDC made small investment returns and operated with the best intentions. Its former staff knew how to plant tea and coffee. Until 1999 CDC made only one loss in its fifty year history: the combined losses in 1999, 2000 and 2001 are likely to exceed £150 million. He asks, and I join him in asking, whether it is too late for the DFID to consider taking over CDC's existing agricultural businesses and managing them on a trusteeship basis? That is a constructive suggestion, to which the Government might like to give time. Together, we need to see what can be done to retrieve the situation.

An issue that is significantly underplayed in the report, but to which the Secretary of State rightly gave great attention, is the question of our overseas aid given through the European Union. There is a fairly bald statement on page 83 of the report that the share of EC official development assistance going to low income countries fell from 52% to 38%". That is in direct opposition to our national aim of helping the poorest. As the Secretary of State said, this situation cannot be allowed to continue.

There is not much in the report about how to improve on such a disastrous situation. By coincidence, this week the Select Committee published the results of its inquiry into EU overseas aid, which amount to a discerning critique of the failures. It is worth highlighting a few points from the report, and I am sure that members of the Committee will raise these matters today.

For example, the aid budget is vulnerable to being raided for political purposes. There is a weakness, compared with our capacity, in focusing on where aid is given. There is a lack of transparency as to which funds are intended for poverty reduction. There is too much of a focus on middle-income countries at the expense of developing countries. It seems that wherever we go in the world, no one has a good word to say for the EU assistance development programme.

While I was in India, the European Commission representative in Delhi came up with one constructive idea for tackling the lamentable delays and inefficiencies of the EU aid programme. He suggested that a member state such as ours might contribute manpower and expertise at grass-roots level to oversee the programmes in which we have a share.

There is an oblique reference to that idea on page 30 of the annual report, in the context of delegating more responsibility to the EU's overseas offices. However, those offices have few staff. Perhaps by that means we could help to avoid duplication. Fundamentally, we must face up to the criticisms that abound about EU overseas aid, and together work out how it could be made more effective.

If the EU aid budget is a thorn in the side of the Secretary of State, Tanzania must be another. I could find nothing in the annual report about the notorious BAE Systems deal. We know that it was a test case to find out whether the good intentions of getting debt-relieved nations to spend money on health and education would work, and it failed. The Secretary of State might have had more chance of opposing the deal if she had found out about it earlier. BAE Systems applied for a licence in 1997, but as the Secretary of State told me in a written answer, she was not informed until October 2000. A constructive suggestion would be to improve that process in Government.

The Secretary of State will be aware of the sustainable development amendment to the Export Control Bill, which was recently approved in another place. It was supported by Conservatives, Liberal Democrats and bishops, and might give the Department for International Development a greater say in such matters. I call on the right hon. Lady to have the courage of her convictions and tell the House that she will support the sustainable development amendment.

As I read the report, my big concern is whether our aid programme is really effective. We cannot be complacent or rest on our laurels. To her credit, the tone in which the Secretary of State presented her review of international development showed no complacency. I welcome that.

There is much rhetoric about helping the world's poorest, but the truth is that much aid is determined by political motives. The vast majority of European development aid goes to central European countries hoping to accede to the EU. Although my hon. Friend the Member for Uxbridge (Mr. Randall) rightly drew attention to the genuine plight of a nation in central Europe, I feel deeply uneasy about the fact that more European development assistance goes to Poland than to Asia, Africa and Latin America put together.

The largest recipient of British overseas aid is India, from which I have just returned. We are about to treble the amount that we give from £110 million to £300 million. India is a country of terrible poverty, with a third of the world's poor living there. Imagine my surprise when I opened The Times of India to read an editorial with the headline "Who needs foreign aid anyway?"—a startling point of view from a major recipient country.

The editor points out that incoming aid just about cancels out the interest on loan repayments, and all the while India is undergoing phenomenal growth through foreign inward investment, especially in computer services. I need to be clear: I am not saying that India should not receive aid, but the way in which it is given is crucial. If the Indians themselves challenge the way in which we do that, perhaps we should stop and listen. There should be seed-corn capital for investment, grants for projects and assistance to kick-start local initiatives, but not dependency-creating loans. There is a crying need for internal reform in India, and our expertise in good governance is almost as important as money.

Tony Worthington (Clydebank and Milngavie)

The hon. Lady refers to an editorial in The Times of India suggesting that we should withdraw aid from India. Is that her position?

Mrs. Spelman

I thought that I had made it clear that I am not in favour of ceasing to provide aid to India. The question is how it is given. In fairness to the Government, there has been considerable refocusing of the way in which the Department for International Development is working in India. I met DFID' s head while I was in Delhi. We are now focused on four of the approximately 30 Indian states. My concern after visiting that country is that although there is no doubt that we can achieve greater effectiveness through backing politically reforming states such as Andhra Pradesh, where there is a state Government with a zeal to modernise agriculture, one of the consequences is that the poorer states, such as Bihar, will fall further and further behind.

Tony Worthington

The hon. Lady raises these questions, but she is a politician. She is supposed to be putting forward policies. What is her policy on India?

Mrs. Spelman

With respect to the hon. Gentleman, it is for the Government to propose and implement their policy, and it is the role of the Opposition to ask questions. This is the one debate a year in which we get the chance to ask a series of questions.

As the Secretary of State said, there is no room for complacency. One glance at the graphs in the annual report showing progress towards millennium development goals reveals an appalling picture for sub-Saharan Africa. All the performance indicators are right off target. In addition, it is almost impossible to factor into such an assessment the terrible question of how HIV and AIDS will affect those poor regions of the world. My experience of visiting India teaches me that the full scale of that epidemic is about to strike another region.

Mr. Piara S. Khabra (Ealing, Southall)

rose—

Mrs. Spelman

I shall move on now, if I may, to discuss trade.

I was taken to India by Oxfam, as part of its fair trade fortnight campaign, to see one of those fair trade projects outside Vellore. The women involved in the project are earning only 70p a day from palm weaving, but with their profits they have already managed to provide sanitary facilities in their village. That is an example of how development policy can be made even more effective.

Our strategy in India, as I said, has been to back the reforming states, but an important question is: what makes a good donor and what makes a good recipient? The relationship between donor and recipient entails responsibilities on both sides. In India we have succeeded in finding good recipients, and I hope that we have demonstrated the skills of a good donor—but enabling the very poorest states to become good recipients is the fundamental challenge for us. The irony of our strategy is that it will leave poorer states lagging behind.

That problem is writ large in sub-Saharan Africa, where the combination of political chaos, conflict and corruption holds us back from helping the most needy. We must develop a model of development assistance for failing states that may go on to become rogue states. As 11 September taught us, we cannot afford to neglect them.

Hugh Bayley

I am pleased to hear the hon. Lady speaking of the need to define a good recipient of aid. We must ask what kind of Government or regime allows aid to be used cost-effectively to implement the millennium development goals. The reason for raising that question, and the reason why I raised it in the International Development Committee earlier this week, is that if we make a distinction between good and poor recipients of aid, we need different policies for our aid relationship with each type. How would the hon. Lady use different policies for good recipients and poorer recipients?

Mrs. Spelman

Again, we are not at the stage of the parliamentary cycle when we have formulated our full plans for the future of international development—[Interruption.] None the less, as the hon. Member for City of York says, we are thinking about it.

In the short term, one of the things that I want to impress on the aid agencies that work in many of those failing states is that it is perfectly reasonable for the donor to expect the recipient to take responsibility, as well as the assistance that is given. The writing of a blank cheque without an emphasis on such responsibility is unlikely to be as effective in the long run as if the recipient state could be incentivised to move closer and closer to good governance.

That is my line of thinking, without yet giving specific policies that would bring that about.

At times, we are worse than unhelpful to the developing world. That is shown most clearly by our policy on trade. For decades now, we have been talking about reforming the common agricultural policy, but, with some minor changes, it continues to deprive developing countries of access to our markets. It is even failing to provide a reasonable income for our own farmers. Of course we accept that they need to make a fair living, but the subsidies that we pay to dump agricultural surpluses in world markets are, frankly, iniquitous.

It may surprise the House to know that India is the largest producer of milk and the second lowest cost producer after New Zealand. India aspires to a new regional market in the middle east, but EU subsidies price it out of that market. In 2000, America's subsidies to its farmers were six times the amount that it spent on overseas development aid. The EU spends nine times more on agricultural support and export subsidies than it does on aid. That is entirely inconsistent with the political rhetoric following the events of 11 September.

We understand the need to address inequalities, and the head of the International Monetary Fund, Horst Kohler, seems to agree. He said in a television interview: The big issue is subsidies for agriculture…we need leadership to tackle these subsidies and then we will create a better world. Britain should provide that leadership for change and advocate the fair trade model.

Mr. Robathan

May I say how much I agree with my hon. Friend? As someone who has a farm, I have a personal interest. I agree with her about the pernicious effect that export subsidies have on markets in developing countries, but does she see any tangible evidence that there will be reform in the near future?

Mrs. Spelman

My hon. Friend will recall that the Secretary of State has said that reform will be brought about only by getting parliamentarians throughout Europe to agree to, and press for, it. We cannot do it on our own. We can provide leadership because Britain is uniquely placed, given our history of trade and our relationship with many developing nations, together with the fact that our agriculture is highly efficient. I would expect the Government to provide leadership to build an alliance for real change.

Mr. David Drew (Stroud)

rose—

Mr. John Battle (Leeds, West)

rose—

Mrs. Spelman

I think that the hon. Member for Stroud (Mr. Drew) was first.

Mr. Drew

I could not agree more with what the hon. Lady says, so will she join the Government in getting entirely behind the Curry commission report and taking forward what we need to say through the various farm organisations—not just in this country, but across Europe—as well those involved in international development? Of course that report refers to the way in which we would want to move towards modulation in this country, which will help.

Mrs. Spelman

The hon. Gentleman will know that I have 15 years' experience of working in agriculture, so I am fully aware that we have got—

Clare Short

Subsidised agriculture.

Mrs. Spelman

As the Secretary of State says, agriculture is subsidised, but that has brought our own farmers to their knees; it is not working for farmers in this country. Reform is long overdue, but I am sure that the hon. Gentleman will appreciate that we must push hard for reform that is not only fair and does not disadvantage our farmers, but—given this brief in particular—allows a fair opportunity for the developing world. That is the vision for which we must strive.

The Secretary of State may be aware that Oxfam put the EU at the top of the double-standards index—a measure of the gap between the free-market principle and protectionist practice. I was interested to see on page 64 of the annual report a picture of the Secretary of State and the Prime Minister in Ghana with some cocoa producers, but Ghana is excluded from the everything but arms initiative. Why do not we help Ghana by offering it better access to European markets? Again, there is an opportunity for real improvement.

Debt relief is the final issue that I want to raise where we can make a real difference. We have heard today that 27 nations have had their debt relieved, but does that reflect reality? What is the recipients' indebtedness now? What about the countries that do not qualify under the tortuously complicated HIPC rules?

Ethiopia, for example, expects a 47 per cent. reduction in debt under the World Bank-initiated HIPC programme, despite which it will have to spend the same amount on the remaining debt as it spends on health. As I speak, 42 countries that could be included in the programme have not even reached the first rung of the criteria required before they can expect some interim relief on their debt service payments.

The IMF warns that the HIPC initiative is likely to fail in many countries and that eight to 10 countries will still be in debt by the end of the programme, so I just hope that, on debt, the Secretary of State is not saying to herself, "That's it. No more needs to be done now." The Jubilee 2000 campaign was one of the most effective campaigns in recent times. Those of us who took part in the human chain around Birmingham during the G8 summit will not let this rest. We are a rich nation. We must find more and better ways to prevent the cycle of indebtedness. We can will the means to the end.

Annual reports from school always contained a series of platitudes, but parents learn to read between the lines. This annual report shows that the Government must work harder if they are to prove next year that they mean what they say about helping the world's poorest. Old relationships built around foreign aid, welfare and donor-driven goals are finally being challenged and re-evaluated. The future is about establishing partnerships and enhancing the situation, so that developing countries take ownership of events in their own countries and use that to go forward.

We do not doubt the Secretary of State's sincerity, but she must ask herself some hard questions about the pattern of British development assistance and its effectiveness, the CDC's retreat from rural Africa, our thinning patience over EU aid reform, and the failure to get it right in Tanzania. To use the scholastic euphemism, there is room for improvement, but I am delighted that the Secretary of State said that we have to do things better.

2.47 pm

Mr. John Battle (Leeds, West)

I welcome this debate and the publication of the report. May I tell my right hon. Friend the Secretary of State that the report represents an encouraging year of leadership, vision and action? After 15 years as a Member of Parliament. I am delighted that international development is being debated more on the Floor and in Westminster Hall. Moreover, more of our constituents are interested in and concerned about international development, so there has been a shift. I also welcome the remarks on agricultural reform made by the hon. Member for Meriden (Mrs. Spelman) and hope that they can be taken forward.

I want to give some practical examples of joined-up Government. I was delighted to see that page 107 of the Red Book includes a significant paragraph on financing development. The Department for International Development also publishes a bulletin with the Treasury, but I suggest that that should be a tripartite report by this time next year. I should like the Department of Trade and Industry to be included in the heading as well as DFID and the Treasury. Let us take trade matters further forward with that interconnection of development.

The Secretary of State said that we need to drive forward implementation. As my journeys with the Select Committee have shown me, we need to be careful that we are not lulled into a sense that we are making inroads when we are not. I am terrified—this is one of those great illusions—that people are running up a down escalator. They think that they are moving up, but they are really being pushed down. We must be sure that we are making deep inroads in reducing poverty.

The poverty of many regions of the world is still unimaginable. The figures hide the reality that millions of people have to bury their children prematurely. I shall give some practical examples. One in five people live in abject poverty, and one in three in relative poverty. A whole continent of countries—Africa—is mostly locked out of the global economy. As is recognised in the DFID report, on current trends sub-Saharan Africa will fail to meet the millennium development goals. Much more needs to be done.

On a Select Committee visit to northern Nigeria, I saw the sheer scale of rural poverty as the desert sands blow in and take over the land. There is a crisis of water provision, food production and rural agricultural sustainability. People in villages eke out a living by growing and drying tomatoes on a tiny scale, without access to processing, markets or real trade. There were thousands of villagers living in what I would describe as pre-Biblical conditions but, sadly, lacking Jacob's well. So the millennium development goal of halving poverty by 2015 is a tough target. We are rising to that challenge, but internationally much more needs to be done for individual countries, particularly the rural poor in Africa.

At Monterrey, the European Union and the United States made additional commitments to increase development assistance by $12 billion. The new American money, the $5 billion, will not arrive until 2004. It is not yet clear how it will be used or what the nature of the new fund is. Financing for development has a long way to go.

The campaign to cancel debt must be continued. What is more we must ensure that promises are delivered. The hon. Member for Richmond Park (Dr. Tonge) raised that point. If I may, I shall put in a plug for my early-day motion 386, calling for Members to support that target of 0.7 per cent. We must keep up the pressure, and not just here in Britain, because it sends a signal to Europe and the wider world.

We need to work with America. I say that as a parliamentarian. We need to work with non-governmental organisations, Church and faith groups, Congressmen and women and Senators. We must make contacts with all people of goodwill to encourage America not unilaterally to isolate itself from international development strategies. Yes, America gives an immense amount of humanitarian aid—often it makes its surplus grain available—but it needs to engage much more positively with progressive development strategies and assistance to Africa, and to get behind the New Partnership for Africa's Development as the most hopeful vehicle for action for the future.

Arguments are shifting. We need to understand the role of trade as well as of aid in future. Trade rather than aid will be the long-term key to the global inclusion of the poor, so it is crucial to make the international trading system fairer to poorer countries and people. I welcome the Speak Out for Trade Justice lobby that will take place on 19 June. I hope that it will be a catalyst for Members of this House and spark off a debate in constituencies about the relationship between trade and aid, and our international obligations.

In the late 1970s and early 1980s when I was working on these matters there were debates on trade policies: the EU policy on textiles and the notorious multifibre agreement. I remember being lobbied hard to say that we in the Yorkshire area where we have textiles should work to keep out textiles from third-world countries. Someone came to me and said that we must keep out textiles from Mauritius to protect jobs in textiles. I remember checking the import penetration of textiles from Mauritius into the Leeds market and it was 0.03 per cent. What happened? The lobbying was effective and worked. Mauritius was blocked off. Import controls were put on.

I recall going to a social club in Bradford to talk about these matters with textile workers. I talked to a man who was playing snooker. He said, "You realise it's a bad day. I have been in here all day because I lost my job." I asked why. He said, "I used to work as an engineer making textile machinery, but the order for my machine came from Mauritius and because people in this same room campaigned against Mauritius I have lost my job." Think of the snooker table. The job will go across the table, hit the cushion and come back into the pocket of the person next to you. That is interdependency. That is the global economy. We should recall that the economic interlock on our globe is much tighter than we realise. Trade is the key to tackling poverty.

We are learning that globalisation promises unity, but it cannot achieve that because of the lack of justice. Globalisation divides as much as it unites. What appears as globalisation for some is localisation for others. What is a new freedom for some descends as an uninvited and cruel fate for others. Some of us can be globally mobile; others become fixed in their localities. Being on the move for some means travelling on a jet; for others it means a refugee truck. Localities in a globalised world can lose their meaning and their negotiating capacities. That great visionary of environmental initiatives, Schumacher, urged us to "Think Global and Act Local", but that is no longer adequate. The world is more interdependent, interconnected and vulnerable. We need to be more subtle and to think and act globally and locally at the same time. The structures of poverty north and south are interlocked.

I close with two themes for the future that are not covered in the report, but which we should take more seriously. The first concerns the whole notion of migration, refugees and asylum seekers. I should like to see them included in the development debate internationally. In 1975, about 80 million people—about 1.5 per cent. of the world's population—lived outside their country of birth. According to the world migration report the number of migrants has now risen to 150 million people, who are mostly legal residents of their new country. No problem with that.

The banker from Seattle who signs a five-year contract for a post in Berlin is a migrant and so is the labourer from Indonesia or Thailand who is subcontracted to a building site in Brunei. Refugees, too, are migrants with that well-founded fear of persecution in their home state. There are now 7 million refugees in Africa alone. Most refugees do not travel thousands of miles away to a new continent but move across the border to the country next door. How often are the refugee camps that we may visit increasingly seen as permanent new townships? If they are, we should face that reality and include them properly in development strategies.

We need to shift the thinking from the static model that refugees live in a temporary camp site and will go back to the place they left, and recognise that increasingly that is not the case. Refugee action and international development strategies must be threaded together. Refugees should be seen as part of development, as valuable human resources and as part of the international solution. That could change the debate.

Secondly, I compliment the Department for International Development sincerely for supporting the development of poverty reduction strategies which put developing countries into the leadership with donors working to support development efforts. I will go further. The work of DFID field workers, for example in Ghana and northern Nigeria, in developing participation strategies, including building from the base up and genuinely working with and including the poor, is radical, innovative and tremendously encouraging. Too often, top-down models have prevailed, even under the cover of language of empowerment, good governance and participation.

An academic, Bill Cooke, who works at the Institute for Development Policy at Manchester university wrote a set of brilliant essays called "Participation: The New Tyranny". He warns us that: an emphasis on the micro level of intervention can obscure and even sustain broader macro level inequalities and injustice. We need to bear that in mind when we consider the whole approach. We need to be aware of the need for more subtle and more complex power analyses at local, national and international level. Moreover, we in the north, in our large cities, can learn from those participatory strategies and basic community development how to work with people and engage them in popular powerful management of their local economy, culture and life.

If scarcity is the discipline of economics, solidarity should be the inspiration of politics. When I first entered the House, I used to joke that I had to raise five issues in Armley, Bramley, Wortley, Kirkstall and Burley before daring to raise the question of international development, otherwise I would be regarded as straying too far from home base. I put my neck out today and say that it is now one for one; for every question I ask about my locality I can ask an international one because the debate has shifted. We should maintain that pressure to show people in inner cities that they are linked to people in rural Nigeria and that their futures are bound together.

The challenge is not just economic, but about developing genuine international solidarity. The universality of globalisation is not about the unity of capital alone; it is not about the unity of the haves but about the true universality of humanity. I close with a quotation from George Bernanos, who said: The ways that lead to freedom are not peaceable or calm. We don't wait for the future like waiting for a train; the future is rather like a climb; the future is not something we have to accept passively, it is something we have to create. I agree with my right hon. Friend the Secretary of State that international development is the key moral, political and economic challenge of our time; we in the House and people elsewhere must all rise to it.

3.1 pm

Dr. Jenny Tonge (Richmond Park)

I congratulate the hon. Member for Leeds, West (Mr. Battle) on a fine and moving speech, which I enjoyed very much. I shall send a copy to those of my constituents who oppose me and criticise me for caring more about the third world than I do about them. My usual response is that I care as much about the third world as I do about them.

It is difficult to tackle the report when we have had only 24 hours to look at it. I admit that I have not read it from cover to cover, but I have dipped in and out trying to find facts and figures. To lighten the mood a little, I shall comment on two pictures. The picture of the Under-Secretary of State for International Development sitting cross-legged on the floor of a hut in Indonesia is particularly fetching. We have all done such things, but he looked very endearing indeed. On page 64, there is an extremely intriguing picture which should go into the Christmas caption competition. The Prime Minister and the Secretary of State are in Ghana apparently discussing the merits of polystyrene chips; I cannot work out what they are looking at—it is certainly not cocoa pods.

Clare Short

It is cocoa; the picture shows what you get when you chop open a cocoa pod.

Dr. Tonge

I thank the Secretary of State. I have not been to Ghana yet; I am going next week or the week after to investigate the water industry. However, I thought that explaining what the Secretary of State was up to in the picture would make a wonderful caption competition. I wish that the civil servants who produced the report had included an index, although I accept that that would be a huge undertaking.

I sometimes get tired, and people say that I am suffering from compassion fatigue. A lot of them ask me why I bother, particularly old cynics in the medical profession and elsewhere. Billions of pounds have been ploughed into Africa over the past 20 or 30 years; hon. Members only have to look at page 89 of the report and those extremely depressing graphs to see that every measurable indicator of progress is going down; nothing is improving, as the Secretary of State confirmed.

Is aid a waste of money? We respond superbly when providing humanitarian aid; DFID is probably one of the best organisations in the world for rapid reaction, getting things moving and getting things done. Some of my friends and colleagues, however, ask whether we are not just throwing aid at people who will take a bit longer to die; we save their lives temporarily, but perhaps they will die later from AIDS, malaria, diarrhoea or starvation.

In southern Sudan, where there is civil war, we know that aid has on occasion been diverted to the Sudanese People's Liberation Army. Has that prolonged the war and made matters worse? Is aid really worth while? To use the words of dear old Hippocrates, are we striving "officiously to keep alive" and trying too hard? Would it be better if we left well alone?

My response to people who ask those questions is "How can we not do something?" Travelling to third-world countries, it is difficult to ignore the suffering. Archbishop Tutu said that just because people are used to children dying like flies from diarrhoea, malnutrition, malaria and so on does not mean that they care any less; mothers do not love their children less because they are likely to die soon. Morally, therefore, we must do something but, as the Secretary of State said, and as we have all said many times, we must do something because it is in our interest. Failed states breed terrorists and send asylum seekers and immigrants to our shores. All the problems of the third world and poverty-stricken countries ultimately affect us. There is therefore not just a moral argument but a practical one for doing something.

Sometimes, people in international development think that they will concentrate on a particular country for a week, only for a natural disaster to occur. Responding to those disasters is DFID's job and, as I said, it does it superbly. Civil wars, such as those in the Balkans and Afghanistan, create problems, and DFID is expected to clear up the mess. I resent that. I have frequently said in the House that funding such action should come not out of the budget reserved for the poorest people in the world, but out of some other budget. Before we take military action, we should consider who will do the clearing-up and who will fund the reconstruction; the Department has had to look at that, too.

Palestine has received millions of pounds of much-appreciated development aid from the European Union, which put in an awful lot of time, effort and resources. However, that was destroyed in two or three weeks by Israeli military action, probably by weapons that we sold to Israel, which is an enormous paradox. I cannot find the right word, but it is appalling that we sometimes do not think through the results of our actions.

This morning, the World Food Programme put out a plea for aid to tackle problems created by bad governance in Malawi and Zimbabwe in southern Africa, which everyone saw coming. All sorts of reasons have been given about why we could not do anything, such as the fact that Zimbabwe is a sovereign state. All the aid that went into those countries has been wasted; there is a huge crisis and a looming famine. It is a crazy situation, and I sometimes wonder whether we are going in the wrong direction. However, I must stop depressing myself completely and make a few specific points.

Clare Short

The hon. Lady should remember that Uganda has consistently grown its economy, has achieved a measurable reduction in poverty and has got all its children in school. Mozambique, which is recovering from the same awful problems as Angola, is doing enormously well. Tanzania has turned around; it is growing its economy and getting more and more children into school. There are successful African models, which we must generalise across the continent. It is not all hopeless and aid is not all wasted; some of it has been enormously effective in improving the lives of some of the poorest people in the world.

Dr. Tonge

I thank the Secretary of State for cheering me up. Nothing in the world would stop me from delivering aid, but I want better and more honest ways of doing so. We should not stop examining what we are doing or questioning how we are doing it, however good DFID is and however many plaudits it receives. We must not be complacent, but must continue to search for different ways of developing underdeveloped countries.

I have been reading the OECD Development Assistance Committee report that looked at UK overseas aid last October, and I want to release one round of unfriendly fire in this debate. The committee considered our progress towards spending 0.7 per cent. of gross national product on overseas aid—a worthy target, to which I hope we all adhere. The Chancellor announced that the ODA budget would increase to 0.33 per cent. of national income in 2003–04. That is excellent; it is to his great credit that he is moving towards the target. He also announced that Britain, along with the United States and Canada, has promised to cancel 100 per cent. of debt for the first 20 countries in the HIPC—heavily indebted poor countries—scheme. Again, that is to his great credit. It is absolutely wonderful and he has received many plaudits. The position of Mother Teresa has already been bagged, but I suggest that he is fast becoming a sort of Albert Schweitzer of the Treasury, who is concerned about the things that we care about.

That is wonderful stuff, but the money to finance that debt relief through the HIPC scheme is apparently coming out of the ODA budget. Does that not mean that two announcements have been made about the same money and that the debt relief is not extra, but is coming out of the overall budget, which has been increased slightly? Debt relief should be not a substitute for aid, but additional to the aid budget.

According to DFID's annual report, the estimated cost in 2001–02 of the HIPC 100 per cent. policy of debt relief will be £8.5 million. That sounds like peanuts, but as the hon. Member for Meriden (Mrs. Spelman) said, only 26 of the 42 countries eligible for the HIPC scheme have qualified, and only four have reached completion and had a proportion of their debt written off, so we are only at the beginning of the process.

Therefore, despite the Chancellor's announcement of the cancellation of 100 per cent. debt for the first 20 countries in the scheme, hardly any of the debt has yet been cancelled. As eligible countries qualify for the scheme, the cost of the 100 per cent. policy will grow, but it appears that it will be set against DFID's accounts and that the increase in aid that the Chancellor announced may be eaten up by the growing cost of debt relief. In that case, there is an even stronger argument for the proportion of national income that is spent on ODA to approach the 0.7 per cent. UN target at a much faster rate. Otherwise, I suspect that we will not be getting what we thought we were getting.

I hope that the Under-Secretary—I assume that he will make the winding-up speech—will tell us what the true level of overseas aid will be minus the debt relief sums, if they are to be included. I have tabled questions to the Treasury on the subject and it has sent me the usual response: that it will reply as soon as possible. I have yet to receive a reply, but we have a right to know by exactly how much the aid budget is being increased and whether it will continue to include money for debt relief.

Clare Short

The hon. Lady makes an important point that concerns not only the UK, but the whole international system. About half the debt of the 42 countries in question is owed to the International Monetary Fund, the World Bank and other multilateral institutions, while the other half is export credit debt to countries such as ours. Once the countries get into the HIPC process, they will stop paying, so relief is provided to more countries than just those that have completed the process. When the export credit debt is written off—that is happening, and the process is acting as leverage for a lot of good reform—it then counts towards ODA-GNP targets.

My Department's budget is the figures that we can see, and that money is not being spent on the debt relief. In the UK and everywhere else, when the debt is written off, it counts towards the ODA-GNP target. I hope that those comments are helpful, as they explain how the international system works. The ODA-GNP targets grow as debt is written off.

Dr. Tonge

I am not completely convinced. I accept the Secretary of State's explanation, but I still think that a bit of double accounting—it used to be called creative accounting in local government—is going on. I think that we are being told that more is being done than is actually happening, and that the overseas aid increase is not as big as it seems because other considerations are being taken into account. As the Secretary of State knows, I would defend her and the Department to the death if necessary for the work that they do. [Laughter.] How about that? However, I would not defend the Treasury, the Foreign Office or the Department of Trade and Industry. I am always watching very carefully what those bounders are up to, because they are always trying to pull the wool over our eyes and I think that the Department for International Development sometimes requires a bit of support. I shall leave that subject hanging in the air in the hope of getting a satisfactory response, perhaps from the Treasury, in future weeks.

The millennium goals are mentioned extensively in the report. We all know that they relate to reducing poverty, provision of primary education for all, and maternal and child mortality. I suspect that most hon. Members would assume that with my medical background, I would want desperately to deal with health issues. I do not. I am still hooked on the Prime Minister's concept of education, education, education. There is nothing quite like it in the whole world, and the fact that we are pushing towards primary education for everyone by 2015 is commendable. It is difficult to decide on the most important factor in development, and we have had endless arguments in the Chamber about what should come first, but education runs through all of them.

Some 120 million children of primary school age are still without proper education. I think that 53 per cent. of girls—and 74 per cent. of those living in south Asia and sub-Saharan Africa—do not go to school. One of the most touching sights in the developing world, especially in Africa, is the droves of little children in pristine uniforms marching to school out of their straw huts, shanty residences or wherever they live. The sight of them leaving happily and proudly is such a contrast with that of our children creeping like snails unwillingly to school. It is very refreshing to visit the country and see their enthusiasm.

In Bangladesh, one can see tiny children as well as older ones working in boiling heat all day to make bricks, but then having the energy to go joyfully into a schoolroom until sunset, so that they can learn something. Indeed, having done all that hard work, they believe that they are privileged to be able to do so. We must never forget how marvellous education is.

Africa has the lowest average primary school completion rate in the world. We know that many children drop out of school because of family commitments or the need for extra income. Of the 70 developing countries that have already built enough schools to educate all their children, only 27 retain 100 per cent. of children in school through to primary graduation. They are falling out of education rapidly; adult female literacy in developing countries declined in 2000 from 39 to 31 per cent.

I want to turn now, as the Secretary of State will expect, to a matter that concerns me hugely. She knows that I have recently returned from a visit to Sudan with the all-party group on Sudan. I hope that all its members will concur with what I shall say. There has been only one decade of peace in that country. Almost one in five children in the south die before they are five, but only about one in three children countrywide go to school. The adult literacy rate is less than 15 per cent. in conflict zones and it is rare to find anyone in southern Sudan who can read or write.

Some donors, including our Government, feel that education is development and that development cannot occur in conflict situations. I want briefly to run through the reasons why I think that we should try to reverse that policy. Education is considered to be long-term development, but UNICEF says that education must play a part in every emergency. It certainly does so when refugee camps are set up; there is always a school tent for the children. Surely the Department for International Development's definition of emergency assistance could be widened to include education. A large resource input would not be necessary. Southern Sudan is not asking for schoolrooms; its schoolrooms are big trees in the countryside.

Clare Short

rose—

Dr. Tonge

Perhaps the right hon. Lady could wait until I have given all my reasons.

Southern Sudan does not need big schoolrooms; it simply needs a few teachers—and more money to train them—who can move around with the population, which frequently has to move, as well as some chalk, slates, blackboards and a few books. We are talking about very basic resources. It does not need many resources. A better educated population, especially women, can help towards the peace process in southern Sudan. The more people are educated there, the more they will be able to recognise the risks of continuing conflict. Education should be seen as a basic resource.

Clare Short

rose—

Dr. Tonge

I want to make a couple of other points before I give way.

UNICEF has said that educational activities—including those involving parents and members of the community—play an important part in building the community. We know how much civil society has suffered in southern Sudan and how much it needs educated people who can help to rebuild it. The people themselves say that education is what they want most, apart from peace. They want their children to go to school. If we are to prevent conflict and try to broker peace, we must concentrate more on education.

The kind of help and facilities that the people are asking for could travel with the population. We must remember that 80 per cent. of southern Sudan is at peace most of the time; the conflict has not been in the entire region all the time. It moves around, and the people there say that the facilities that they need could move around with the population. I shall now give way to the Secretary of State.

Clare Short

I am grateful to the hon. Lady. The answer to her question is yes, the humanitarian support for displaced and refugee children should always include education. The quality of the humanitarian effort in Sudan has been very poor. Until recently, 90 per cent. of the support was spent on aeroplanes, and only a tiny amount of the quite big expenditure was getting through to the people. After my visit, I sent one of our humanitarian advisers to get a commitment from the Government and from the Sudan People's Liberation Movement in the south that they would allow us to work with them to enhance the quality of the humanitarian effort. That includes getting children into school, although not yet as part of the rebuilding of the state—that will come after peace—but as part of the enhanced humanitarian support that will get displaced and refugee children into school. We will be working on that.

Dr. Tonge

That is excellent news. I hope that all the members of the all-party group who went to Sudan will have heard that; we shall come knocking on the Secretary of State's door asking for details very soon.

Like the hon. Member for Leeds, West, I am increasingly of the opinion that, although those countries need aid for education, health and clean water, they need trade and investment more than anything. If we look at the countries that have made progress, they are those that have trade and investment. I therefore endorse what the hon. Gentleman said. The Secretary of State mentioned the World Trade Organisation. We must strengthen that organisation instead of constantly denigrating it. People in this country should realise that, if the WTO were strengthened and had more representation from developing countries, it could be such a force for good in the world. Developing countries desperately need trade.

I shall refer quickly to commodity prices, which continue to cause instability in countries that depend on such income. Coffee is the perfect example, and problems are looming again in that respect: the price of coffee has fallen by 70 per cent. since 1997. I remind the House that a fall in coffee prices was one of the factors that triggered the Rwandan genocide. Trade issues must be watched carefully, because they can trigger much worse events in the world.

At the G8 summit in June, the Government must propose tariff and quota-free access to all exports from the least developed countries by 2005. We must make progress on that. The everything but arms initiative, which the hon. Member for Meriden mentioned, must be expanded to include tariff and quota-free rice, sugar and bananas from the least developed countries. We have to give on these matters. The common agricultural policy, which is fast becoming a sick joke because of the time it is taking to reform it, has to be revised and agreed by EU leaders.

Mr. Robathan

I am grateful to the hon. Lady—with whom I enjoyed a happy week in Sudan—for giving way. My intervention is not on Sudan, however, but on the CAP. It has to be reformed. I think that everyone in the Chamber who is concerned about international development agrees on the impact that it has on the agriculture of developing countries, in terms of export subsidy and so on. What evidence does the hon. Lady have that it will be reformed?

Dr. Tonge

The hon. Gentleman asks a very good question. I have no evidence, except that Minister after Minister—including the Prime Minister—in this Government and the last one have always said that it would be reformed. This is a matter of the utmost urgency. If the European Union is to expand—my party and I hope that it will—we must reform the CAP. Those two events go together, and we simply have to get on with it. The only evidence I have, however, is what people say. The hon. Gentleman suggests that that is all talk and no action, and I agree with him that that seems to be the case at the moment.

Foreign direct investment in developing countries increased from $24 billion in 1990 to $184 billion in 1999. It dropped, however, to $167 billion in 2000, and only 6 per cent. of that capital ended up in the poorest parts of the world. Most private capital goes to Latin America, eastern Europe and the former Soviet Union. It worries me that the Commonwealth Development Corporation was the only organisation that would go into areas where there were civil wars or undemocratic Governments. The CDC dealt with that kind of situation. No company wanting a 25 per cent. return on its activities will go into an unstable situation. I know that my hon. Friend the Member for North Norfolk (Norman Lamb) wants to expand on that, if he is lucky enough to catch your eye, Mr. Deputy Speaker. It is a matter that we are concerned about.

Multinationals sometimes invest in developing countries, although their investment does not always reduce the poverty there. Irresponsible investment and employment practices can contribute to poverty and economic insecurity. I should not have to remind the House of all the campaigns that have gone on over the years against multinationals because of their activities in developing countries. The problem is that they are still not subject to regulation on an international scale.

The OECD guidelines are good, worthy and beautiful, but there is nothing to make the multinationals adhere to them. I have recently been made aware of an organisation called the UK National Contact Point for the OECD Guidelines for Multinational Enterprises. It is an organisation to which people can complain if they think that a multinational is behaving badly somewhere in the world. I understand, however, that no submissions have been made to it so far.

We need those OECD guidelines to be legally binding, please. Then multinationals could not compete with one another for bad practice, but they would have to compete for good. I feel quite optimistic about that matter, as companies have taken on board a lot of the messages from the demonstrations and all the fuss that the NGOs have made about their activities and world trade.

Many multinationals are thinking about all that or are at least publishing glossy brochures that show the wonderful things that they are doing in the countries where they operate. That is a great leap forward. Companies such as Rio Tinto are much better and are taking that agenda on, but the guidelines must be legally binding. That is the only way to achieve corporate social responsibility in the long run.

The House has been very indulgent. I have touched on only a few issues, and there are many others that I could mention. The report tells us many things, but it does not provide a genuine feeling as to whether the millennium goals will be achieved. I guess that we could not hope for that. I still fear that HIV/AIDS and continuing civil wars will prevent the world from making great progress in the next 20 years, although I hope that I am wrong. I am particularly worried about the consequences of HIV.

Nevertheless, I congratulate the Department on the work that it does. Its civil servants must surely be the most dedicated and successful at Westminster. I am also pleased by the extraordinary number of Members in the Chamber. It is a credit to the Department, the Secretary of State and the Minister that so many are here. At first, I wondered whether Members were avoiding the local elections, but perhaps I am being too cruel. I congratulate Members very much on their attendance, as it shows how seriously the issue is being taken and how extremely important it is.

3.32 pm

Mr. Tony Colman (Putney)

I apologise to the House, as I am unable to be present for the winding-up speeches. I must attend a constituency event to which I had agreed before the debate was timetabled.

I, too, congratulate the Secretary of State on her departmental report. I shall concentrate on two core issues, which should be prominent in any discussion on international development. The first is partnership. As expressed in the New Partnership for Africa's Development initiative, partnership for development is invaluable. Following last week's meeting in Dakar, it continues to gain momentum and, as a home-grown African initiative, it deserves our full support.

Inherent in the idea of partnership is equal relations. It is time to move from the hierarchical relations based on who gives and who receives aid. We all understand that aid is essential, but it is a drop in the ocean in terms of real and sustained development across the world. Only through fair trade can countries create economic prosperity.

Interestingly, a debate on European Union, British and American relations is taking place in Westminster Hall. It is always difficult when two debates that may cover the same subject are going on at the same time. We in Europe and north America must open our markets to emerging economies as they are opening theirs to us. As the Secretary of State, the hon. Members for Meriden (Mrs. Spelman) and for Richmond Park (Dr. Tonge) and my hon. Friend the Member for Leeds, West (Mr. Battle) said, continuing high EU farming subsidies are a major barrier to fairer trade for African horticultural exporters. And so say all of us in the Chamber.

For that reason, it is imperative that developing countries make every effort to use their muscle at World Trade Organisation meetings and other trade-related conferences. For all the bad press that the WTO receives, it is still one of the few international organisations that is run on a one member, one vote system. As such, it is more democratic than the United Nations or the World Bank can ever claim to be.

Encouraging and facilitating the growth of less powerful voices in such arenas should be part of the Department's mandate, and discussions in which real partnership can be forged through negotiations must also be encouraged. I echo the points made by the hon. Member for Richmond Park about the need to enshrine in law the guidelines for multinationals. Also, I very much welcome the WTO negotiations on the so-called Singapore issues of investment and competition, which are due to start next year.

However, we must think more deeply about which industries can produce the sustainable development that so many countries require. Export orientation certainly provides a good route map, but it must be coupled with diversification. Mono-economies are vulnerable and, in many cases, unsustainable. It is imperative that the growth of industries such as mining is coupled with a corporate social responsibility agenda.

In Ghana, for example, to say that foreign exchange is like gold dust is a truism—gold is indeed the Government's major source of foreign exchange and an absolute necessity. Yet many mining corporations in some countries have left environmental and social problems that will take decades to rectify. I welcome next month's mining, minerals and sustainable development conference in Canada, which offers an unprecedented opportunity to change the culture of the mining industry for the better.

On my recent visit to Ghana, I was impressed by the efforts of Ashanti Goldfields in the Wassa West area of western Ghana, in co-operation with the local community, to return land used for mining to sustainable agricultural use. I hope that NGOs such as the Third World Network take up the invitation to discuss with Ashanti Goldfields their concerns about mining operations in western Ghana. I believe that many are unfounded, and it is extremely important that local NGOs take up the opportunities offered by multinationals operating in their countries—especially those, I have to say, in which the Ghanaian Government have a golden share—and get those matters dealt with.

Given that the resources of all the multilateral banks combined are dwarfed by those of the private sector, it is important that an investment-friendly environment is created to encourage businesses to invest in emerging economies. Interestingly, Unilever's best investment area in the world is Africa, where it achieves an overall rate of return of more than 35 per cent. on capital employed. However, economic and, indeed, political stability are precursors of such investment, and international donors can help to create the right climate for long-term private sector interest.

Trade in services is also important. Returning to Ghana, it is clear that urban water provision requires investment on a scale not possible solely through governmental channels. I hope that Christian Aid in this country listens to Ghanaian civil society in terms of some allegations that are being made. I am pleased to hear that my near neighbour, the hon. Member for Richmond Park, is visiting that country shortly. I note from the report that the Department has already helped South Africa and Guyana with arrangements similar to those proposed for Ghana.

Private sector involvement in providing essential services is necessary in many areas, but any trade in services must he fairly and transparently regulated to ensure that the best possible route to sustainable service provision is found. Partnership between Governments and the private sector is imperative to improving services for expanding populations in many developing countries.

The second major point that I want to emphasise is international responsibility. The route to sustainable development is trade rather than aid, but it is clear that many countries are not in a position successfully to integrate into the world economy. As the conclusions of the last NEPAD meeting show, many national leaders face impossible situations.

Ravaged by conflict, countries such as Sierra Leone and its less internationally popular neighbour, Liberia, cannot expect trade to solve their ills in the next few years. The people of Sierra Leone hope for free and fair elections as well as a responsible and honest leadership, but even if those elusive goals are achieved, what of the thousands of soldiers who spent their youth with a semi-automatic weapon as a companion? They must be demobilised and reintegrated. In Sierra Leone, the dedication of the United Kingdom Government provides hope for the future through funding of reintegration programmes, training of the national army and assistance to the innocent civilians who have lost everything to war.

However, across the border in Liberia the international community has had good grounds to be more cautious in providing assistance. The relative lack of outside support has allowed peace to become an even more illusive goal. Under Charles Taylor, Liberia has regressed into violence. Those who suffered at the hands of out-of-control rebels in the 1990 war forget nothing, and will not bow to a Taylor Government. The contrast between the relative success of post-conflict reconstruction in Liberia and Sierra Leone shows clearly how much international support can achieve. I ask the Secretary of State to consider support for the situation in Liberia.

It is important to outline again and again the idea of international responsibility, which should be borne in mind given the recent stunted progress at Sun City in South Africa in the InterCongolese Dialogue. Post-conflict countries require our support, through aid and technical assistance. Without such support, they have the capacity to destabilise entire regions.

Thus, the international community has a responsibility to help countries to pull themselves out of destructive and debilitating conflicts, and out of the poverty that can be both a cause and an effect of such destruction.

I had hoped that, in her opening speech, the Secretary of State would shed more light on what was discussed at World Bank-International Monetary Fund spring meetings. Perhaps the Minister will be able to elucidate those issues in his winding-up speech, which I regret I shall have to read in Hansard. Last week, the Chancellor expressed clearly the current high level of political will to combat poverty and instability. I welcome the open and frank discussions on the important issues of sustainable debt and expanding the HIPC initiative.

In a similar vein, the recent experience of Argentina has opened up a debate on the possibility of creating mechanisms for dealing with country bankruptcy. That is a most welcome move, and I hope that there will be further discussions leading to agreement on a way forward on this issue. I congratulate Anne Krueger, the IMF deputy managing director, for her work so far, and I look forward to concrete proposals being put to the next IMF meeting this autumn.

The G24 also proposed that the rich countries should allocate a proportion of their special drawing rights to a special development fund. There is now a high level of agreement that far greater funds are needed for development, and the use of special drawing rights may be a way forward. I hope that the Minister will be able to provide information on how the debate on that has moved. I understand that there was a 40 per cent. vote in favour of that proposal at the World Bank-IMF autumn meetings. How far have we moved to get consensus and agreement on the Chancellor of the Exchequer's Marshall aid plan for development?

The other point that the Chancellor made in that excellent pamphlet was that other revenue-raising mechanisms could be used at an international level to provide further funds for development. A tax on international currency speculation was one of the most promising proposals, and could raise the enormous sums needed. More and more economists are beginning to realise that such a tax is technically and administratively feasible if collected through settlement transactions. The new settlement transaction system is going live this month. I welcome the open-minded approach taken in the UK and in Europe on this issue, and hope to see further constructive discussion.

It is imperative that the hierarchical nature of international development relations in the past is replaced with 21st century partnerships. At the same time, the international community must recognise its responsibility to countries that are unable to engage with the global economy. For that reason, aid must be focused on the least-developed countries and the poorest groups.

I commend the Secretary of State and the Chancellor on their work. They realise that we still have a long way to go to achieve effective financing of our development goals, and they are leading the way by pushing for international responsibilities to be met in a spirit of international partnership.

3.44 pm

Tony Baldry (Banbury)

I am glad that Government business managers have made time for a debate on international development. Immediately after the publication of the departmental report is obviously a good time for such a debate. The Select Committee on International Development will study the report with care.

This week has also seen the publication of the Select Committee's report on the effectiveness of European development assistance. Eight members of the Select Committee are present for this debate. Two of them have already spoken: the hon. Members for Leeds, West (Mr. Battle) and for Putney (Mr. Colman) both made excellent speeches, and I agree with everything they said. I hope that outside and inside the House it will be felt that Select Committee members can collectively make useful judgments, and can individually bring useful experience to bear. I am sure that my hon. Friend the Member for Blaby (Mr. Robathan) will describe his recent experiences in Sudan, and the Select Committee yesterday heard about the moving experiences of the hon. Member for Cynon Valley (Ann Clwyd) in Jenin. I hope that that collective experience is of value to the House.

An enormous amount is happening in international development, any part of which could justifiably form the substance of a full day's debate. The year 2000 saw the publication of the United Nations millennium goals, which set some clear and unambiguous targets that we have to achieve between now and 2015, including halving the number of those who live on less than $1 a day, ensuring that children everywhere are able to complete a universal primary education, and halting, and hopefully reversing, the spread of HIV and AIDS. There is a total of 18 straightforward targets for the international community to achieve.

We must recognise that the pace of progress towards reaching the millennium goals is different in different parts of the world. As the Secretary of State said, China, with an annual growth rate of something like 9 per cent., will comfortably meet those targets. However, I note that the Department for International Development and the Treasury, in their recently published joint report "The Case for Aid for the Poorest Countries", acknowledge that on current trends sub-Saharan Africa will fail to meet the 2015 goals.

Chapter 4 of the departmental annual report helpfully shows how we are doing in meeting the millennium development goals, and illustrates each goal with a useful, clear graph showing progress to date and the rate of progress needed to meet the targets. Everyone can look at those diagrams, but by my calculations, on two of the targets we are well on track, on two of them we are well ahead, but on the other 14 there is still a substantial distance to go, particularly in sub-Saharan Africa, as shown by the graphs on page 59.

This year, there will be three important development-related conferences. We have already had the WTO conference at Doha. It is important to recognise that Doha was not the finish but the start of what will almost certainly he a number of years of painstaking and detailed negotiations on reforming the system of world trade. It is vital that poorer nations obtain fair access to developed markets, and that the fine words and good intentions of WTO members at the outset are not overwhelmed by mercantilist self-interests in the detailed negotiations.

I should like to make two points about the Doha and world trade negotiations. Agribusiness, which means maximising the return on agriculture and primary production, is the foremost activity for many poorer countries. If they do not get greater access to developed markets for their agricultural produce, there is little prospect of their improving their standard of living.

At present, the common agricultural policy is one of the most protectionist trade regimes in the world. Indeed, not only does it make it very difficult for agricultural produce from poorer countries often to make it on to the shelves of our shops, but it encourages agricultural practices that lead to the dumping of surplus European produce in poorer countries, further undermining their farmers' ability to earn a living. When the International Development. Committee was recently in Ghana, it was very noticeable that the supermarket shelves were stacked with tins of tomatoes from Italy. That is hardly necessary in a country such as Ghana, which produces excellent tomatoes of its own but which all too often lacks the investment and infrastructure to process them. However, I suspect that so many Italian tomatoes were in Ghana because, in effect, they had been dumped there by the European Union.

European Union spending on agricultural export subsidies dwarfs EU development assistance. Access to European markets, including those for key agricultural products such as sugar, rice and beef, continues to be restricted. In this week's Select Committee report on EC development assistance, we said we agree with Chris Patten that the most important issue that we will have to resolve as a Union and as a Commission in order to convince developing countries that we really have their interests at heart is the whole issue of CAP reform". We unanimously observed that it is

time that the EU hacked up its warm words with good deeds and made concrete progress with removing export subsidies and improving access to the EU market.

We could also extensively debate the concern that many developing countries' efforts to deal with their HIV/AIDS crises are hampered by disagreements about intellectual property rights—another WTO issue. Theirs is a tragedy of monumental proportions. Only last week, it was estimated that HIV/AIDS is now so widespread in South Africa alone that many people there will die before the age of 40, and that in the not too distant future AIDS will cut life expectancy to 38.

I hope that there will be a positive response to two measures introduced in the Budget: the new tax credit to encourage companies to increase research into vaccines and medicines for the prevention of malaria, TB and AIDS; and the new tax relief to encourage donations of medical supplies and equipment to developing countries. Hopefully, the new tax credit will be a further incentive for the UK pharmaceutical industry to focus its attention on this important work.

Doha was followed by Monterrey, and the good news at the financing for development conference was that the United States did come forward with substantial extra money—up to $5 billion extra each year. However, I entirely agree with the hon. Member for Leeds, West that there is still more that the United States can do. We need collectively to engage with colleagues in the US Congress, and with non-governmental organisations and other development organisations in America.

However, I suspect that a much clearer commitment needs to be made at Monterrey on meeting pledges to the global health fund so that progress on health can be made. An assurance needs to be given that no developing country's national strategy for meeting the 2015 education target will fail through lack of the funding that would enable them to move forward on education.

The Chancellor of the Exchequer frequently mentions the UK's objective of meeting the 0.7 per cent. target, but, importantly, we have no timetable. That is perhaps understandable, as to meet the target the Chancellor would have to double current funding to DFID, but it is surely possible to establish a process and to find a form of words that demonstrate a clear commitment. For example, we could aggressively seek to meet our target of 0.7 per cent. of gross domestic product for overseas development by, say, 2012.

Although the sums for increased development that were outlined at Monterrey are welcome and represent real progress, the Budget Red Book confirms that they still fall short of the aid levels necessary to achieve the Millennium Development Goals…which the World Bank estimates will require $40 to $60 billion each year. I should be grateful for some clarification from the Minister. On page 107, the Red Book notes that, in November 2001, the Chancellor proposed an International Development Trust Fund". On Tuesday, the Select Committee took evidence from those development NGOs that had been particularly involved in the Monterrey process. None had any details about that international development trust fund. It would be helpful to have a better understanding of what the Chancellor is proposing, and how much substance the fund has to date. The Red Book suggests that the fund will lever in private sector finance. Again, it is unclear how that will be achieved. Will it constitute a private finance initiative for international development?

Rather than setting up a new mechanism such as an international development trust fund, about which people seem to have heard little, why not seek to achieve the 0.7 per cent. commitment sooner, rather than later? I draw the attention of the Secretary of State and the Minister to early-day motion 386, which was initiated by the hon. Member for Leeds, West, and which has attracted signatures from 232 Members. It simply calls on the Government to make a firm commitment to achieving the 0.7 per cent. target by 2012, and the 0.4 per cent. target by 2006. That is surely achievable, and perhaps such a straightforward commitment would be easier for everyone to understand than the setting up of yet another fund.

What is certain is that 2015 is not far away, and, according to the Treasury's own estimates, $40 billion to $60 billion a year remains a fairly substantial shortfall.

Norman Lamb

Has the hon. Gentleman been successful in achieving agreement within his own party about the essential importance of achieving the 0.7 per cent. target within a specified time scale?

Tony Baldry

My hon. Friends on the Front Bench can speak for themselves, but I do not think that any division, dissent or lack of commitment exists among Conservative Members in respect of meeting the 0.7 per cent. target. However, my hon. Friend the Member for New Forest, East (Dr. Lewis), who is winding up for the Opposition, will have heard the comments that were made, and he will doubtless respond. I would hope that many of my right hon. and hon. Friends have signed the early-day motion to which I referred.

Mr. Simon Thomas

Will the hon. Gentleman bear in mind the latest recommendation of the Environmental Audit Committee, which has been examining preparations for the world summit on sustainable development? The Committee also called for a timetable for reaching the 0.7 per cent. GDP target, so across the parties, the evidence, and the pressure on the Government, is increasing.

Tony Baldry

That is a timely intervention. As I was about to say, Monterrey will be followed in September by the world summit on sustainable development—the last in the trilogy of summits, at Doha, Monterrey and Johannesburg. The Environmental Audit Committee has published an excellent report on the UK's preparations for the summit, and I hope that, through the Liaison Committee, time can be found to debate it extensively, whether here or in Westminster Hall. Perhaps it could be debated together with the report that the International Development Committee will shortly be publishing on the impact of climate change on development. I should point out to those hon. Members who have not read the Environmental Audit Committee's report on preparations for Johannesburg that it is well worth reading.

Everyone will support the Government's approach at Johannesburg, which will be to push issues such as poverty eradication and access to clean water, rather than climate change and biodiversity, for which frameworks of action have largely been agreed. Poverty remains the central threat to achieving sustainable development. A commitment to working for a sustainable planet is in no way inconsistent with a commitment to ensuring that the world's poor can access development, or to a commitment that, wherever possible, all will be done to help lift them out of poverty. Work by the Environmental Audit Committee and some evidence taken by the International Development Committee have suggested that tension exists between environmental NGOs and developmental NGOs, but I hope that there is no conflict. If poor countries are to prosper, they need sustainable development, and we must find ways to take forward that process.

Doha, Monterrey and Johannesburg are part of a continuing process and will be important in ensuring—through debates such as these, which I hope will be annual—that the international community is delivering year on year on the promises made at these conferences. We could spend a whole day debating EC development assistance. After all, a quarter of DFID's budget is channelled through the EC. The good news is that the European Community is the fourth largest donor of development aid; the bad news is that precious little of that money goes towards helping poor countries. Indeed, a shrinking share of Europe's development assistance goes to the poor.

In 2000, the proportion of EU development assistance spent in low-income countries reached a new low. None of the top 10 recipients of EU aid is a poor country. Poland receives more development from Europe than the whole of Asia and Latin America combined. At the moment, far too little of Europe's development budget is being used to tackle poverty, and far too much of it is being used in pursuing the wider foreign policy objectives of other European member states. The Select Committee came to the straightforward conclusion that money earmarked for development aid should be targeted on the poorest, and that EU development aid could be deployed more effectively.

There is much more for us to debate. With regard to conflict and defence sales, we will shortly have the opportunity to debate the Export Control Bill when it returns to this House. I hope that the Government will accept the amendments on sustainable development that were passed in the other place. It would be a pity if the Government used their majority in this House to remove from the Bill the commitment to sustainable development. If they do, it is difficult to see what the Bill is about.

We have heard that India is the recipient of the largest amount of UK bilateral aid, and the country strategy paper on India shows that that is because a third of the world's poor live there. However, I hope that I am not alone in being at a loss to explain why we give substantial development aid to India—it has within its borders one third of all the world's poor, and yet we are about to grant export licences to the same country for defence equipment worth £1 billion. That £1 billion is equivalent to 10 years' worth of UK bilateral aid to India at the same level. In effect, we are removing from the Government of India the obligation to pay for the defence equipment themselves, as they are able to use the bilateral aid money for that purpose.

Of course, I realise that other factors, such as jobs and employment, must be taken into consideration. However, the provisions on sustainable development in the Export Control Bill need to be firm commitments. Otherwise, many people will feel that it is a rather weasel-worded Bill.

Mr. Robathan

On that issue, does my hon. Friend agree that the enormously expensive development of nuclear weapons by India—God knows how much it has cost—sits rather ill with the fact that that country receives aid from us, and from other countries?

Tony Baldry

My hon. Friend makes a good point. I wrote a letter to the Secretary of State for Trade and Industry this week in which I raised very similar matters, but I shall not try the patience of the House by repeating my comments today.

On debt relief, Select Committee members saw for ourselves in Ghana—which has now achieved HIPC status—the enormous benefit that can be achieved by reducing debt and thus helping to reduce poverty. The sums involved are not insignificant: so far 26 countries receive debt relief worth $62 billion under the HIPC initiative, but debt relief must lead to a sustainable exit from indebtedness.

I am sure that the Secretary of State for International Development and the Minister have seen early-day motion 736, which was initiated by the hon. Member for South Swindon (Ms Drown). It has been signed by 321 hon. Members, and I doubt whether any such motion has attracted so many signatures. It calls for the acceleration of debt cancellation under the HIPC process, and I hope very much that the Government will bear it in mind.

I shall conclude with two brief points, the first of which has to do with Africa. At one end of the scale, a number of large multinational organisations such as Ashanti Goldfields or Shell are doing very well in Africa, and, at the other end of the scale, huge numbers of traders continue the entrepreneurial trading that they have conducted for centuries. Between those two groups, however, there is a huge "missing middle" of small and medium-sized businesses.

It was depressing to be told by the representatives of the World Bank in Ghana—which is a good example of an African economy—that the quickest way to make money was to import goods and shift them as speedily as possible. That is how entrepreneurial people make money in Ghana. When DFID next reviews its country strategy plans, I hope that, where appropriate, it might consider what further support and help can be given to the private sector, to the encouragement of enterprise and, in particular, to the development of medium-sized businesses in developing nations.

My final point has been firmly underlined by the NEPAD initiative, and concerns a matter raised already by the hon. Member for City of York (Hugh Bayley) and by my hon. Friend the Member for Blaby. It is that, if development is to work, it has to be a partnership. The NEPAD conclusions refer to mutual interests, shared commitments and binding agreements. The phrase "good governance" is not simply some slogan: there has to be proper democratic accountability for countries to succeed. We need to move on beyond the systems that exist in too many developing countries where, it strikes me, governance is still a matter of patronage from the top and petitioning from the bottom, rather than of democratic accountability, of Governments accounting to elected politicians, and of those politicians in turn accounting to their constituents.

As the Secretary of State noted, if Africa is to move forward, Nigeria has to move forward. Those of us who went to Nigeria saw only too clearly that that country has to convince the rest of the world that it is bearing down on corruption and that it is determined to take forward good governance.

In conclusion, I find the statistics on development almost overwhelming sometimes. The hon. Member for Richmond Park (Dr. Tonge) said that something like 120 million children still lack primary education. I find it difficult to visualise 120 million children, so when I go overseas now I take photographs—of children, elderly people, and women at work—and put them on the kitchen wall at home. The photographs remind me that the people in them are individuals who deserve our support.

The photograph on the front cover of the Department's annual report is very telling. It shows a woman working with others to hew out a future for herself. What we are involved in is not a matter of millions or billions of people, but comes down to showing solidarity with and support for every single woman who wants a better life for herself, her family and her children.

4.7 pm

Mr. Piara S. Khabra (Ealing, Southall)

I shall not speak for too long, as not much time is left for all the hon. Members who wish to contribute. However, I should like to congratulate my right hon. Friend the Secretary of State and her Department on their efforts to address the problem of poverty in the world, as well as on the informative report that they have produced. I am pleased to be able to contribute to today's debate as a member of the Select Committee on International Development.

Successes or failures are perhaps harder to quantify in international development than in the work of any other Department, as they depend on so many factors beyond the Department's control. However, the Department has invested huge sums of money in many of the world's poor and developing countries to tackle the issues of education, health and poverty.

Mention has been made of India. I come from India, and retain an interest in it. It is a huge country, with enormous resources. The money being given to India is being used properly to reduce poverty, and I do not agree with my Select Committee colleague the hon. Member for Banbury (Tony Baldry) that the Government should not consider supplying arms to the country.

Results in reducing poverty across the globe cannot be achieved by one Department in one country. They can be achieved only through partnerships between developed and developing nations, and between Governments and their peoples. Events in the past year have shown that we live in an increasingly integrated world where suffering cannot be ignored, even if it is far away. Failure to address poverty and disenchantment in a single country can have repercussions across the globe.

The Department for International Development has clearly worked hard in the past 12 months and there are a number of achievements with which it should be pleased. One is in the area of sustainable development, which the Brundtland commission defined as development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

The topic is particularly relevant this year as countries prepare for a United Nations summit on the issue in Johannesburg in September. I am pleased with the conclusions reached through the Department's work with the OECD Development Assistance Committee and the UN that good poverty reduction strategies should contain the elements necessary for strategic planning for sustainable development. Unfortunately, as was pointed out in a report published last December by the United Nations Economic and Social Council, progress towards the goals laid out in Rio de Janeiro at the conference on environment and development has been slower than expected. Indeed, the report suggests that in some respects, conditions are worse than they were 10 years ago.

I am not pleased with the attitude of the present United States Administration, who have shown a disregard for environmental concerns. As the United States is the major power of the industrialised world—and also the largest consumer of resources—I would have expected better leadership from it.

The poor quality of many people's living environment results in the deaths of millions each year. To take just one example, the World Health Organisation estimates that about 2.1 million people—the vast majority of whom live in developing countries—die annually from indoor air pollution. One reason for the continuing problems is undoubtedly the failure of many developing nations—and developed nations, for that matter—to integrate sustainable development fully into Government policy. Instead, it is often treated as a stand-alone issue and passed to a separate environmental department. We need to work with developing countries to ensure that sustainable development is treated seriously by all sectors of government.

Another area that DFID has addressed, and which seems particularly appropriate to mention today, on Africa malaria day, is disease. Several hundred million people annually continue to be infected with malaria, which results in nearly 300 million clinical cases and 1 million deaths a year. The deterioration in health structures, migration, poverty and the emergence of drug-resistant parasites has meant that the problem is actually getting worse in some countries.

It is estimated that economic growth in African countries where the disease is endemic has been slowed by up to 1.3 per cent. this year. I am pleased, therefore, that the UK played a leading role last year in securing a commitment from the G8 countries to a global fund to fight HIV/AIDS, tuberculosis and malaria.

The Department has also tried to address the dreadful problem of HIV/AIDS. Last year it published its strategy for its contribution to tackling the disease, which has a devastating effect on people in many countries. I have been to countries in Africa with a parliamentary delegation, and we saw the devastating effects of the disease on the lives of many people—on their life expectancy, current development and future well-being.

During the 1990s, life expectancy declined by 6.3 years in the nine countries hardest hit, and there are currently about 36 million adults and children living with HIV/AIDS. The situation is exacerbated by two factors. The first is the refusal of many leaders—often for cultural or political reasons—to accept that there is a problem. One example of that, I am afraid, is India, where officials have frequently played down the problem. Similarly, South Africa's president has also failed to accept the international consensus on HIV/AIDS.

It is noteworthy that in the 1980s, when HIV hit Thailand, its Government prepared an aggressive campaign to provide information to the groups most at risk. Thailand spends more than 60 cents per person on HIV, whereas India spends a little less than 6 cents. Mr. Sarkar of the United Nations AIDS programme for south Asia has expressed his concern that the epidemic in India has not peaked and is unlikely to stabilise, because of a lack of education and intervention.

The second problem is the slightly simplistic approach taken by many to the problem. I believe that the message about HIV has been hampered by the focus on drugs patents, specifically for drugs to treat the disease. It is a simple fact that even if the drugs were provided free, Governments could not afford to distribute them, especially in a country the size of India. Also, the drugs must be taken properly. Some have to be refrigerated, which is often not possible, some have to be taken at certain times, and some with eight glasses of fresh water a day and at regular intervals. Some drugs can make people very ill.

For those reasons, many sufferers cannot continue their course of drugs; they start taking them and then stop. Starting and stopping is particularly dangerous, because it allows HIV the opportunity to adapt and become resistant, thus making many current treatments useless in the future. A recent study in San Francisco, with all its medical sophistication and experience, has predicted that by 2005 nearly half of all HIV patients in the city will no longer respond to their current treatment.

The emphasis on drugs in developing countries has shifted attention away from prevention and has left ill-informed populations with the impression that there is a cure—in which case, why should they change their habits? It is important to educate people. It is essential that DFID works with Governments around the world to address the issue, and that heads of state in developing nations recognise the problem and take the necessary action. Failure to do so will be nothing short of devastating.

The Department appears to have achieved much in the past year; we should not forget the untying of aid. It is encouraging to note that peer review of the Department by the OECD Development Assistance Committee has welcomed many of the changes made since 1997. It says that the UK's approach demonstrates the value that bilateral aid agencies can add through contributions to international policy debates and by monitoring the implementation of international undertakings.

We can achieve a great deal and make a real difference to people's lives if we work together. We cannot do it on our own. The report is good, and we must continue to consider the problems faced by the international community.

4.20 pm

Mr. Andrew Robathan (Blaby)

It is a pleasure to follow the hon. Member for Ealing, Southall (Mr. Khabra), my colleague on the International Development Committee. As he knows, I share his concern about the impact of AIDS on the developing world. I am glad that he raised it.

During the past four years, as a member of the Committee, I have had the good fortune—usually—to visit many countries in Africa, including, among others, Rwanda, Mozambique, Kenya, Uganda, South Africa and Swaziland. Over the past nine months, I have visited Eritrea, to see mine clearance: Congo, with the all-party group on the great lakes region and genocide prevention; and Ghana and Nigeria, with the Select Committee. Only two weeks ago, I visited Sudan, with the all-party group led by my colleague, the hon. Member for Lancaster and Wyre (Mr. Dawson).

I want to talk specifically about African development and to concentrate on the Congo, Sudan and Nigeria. I recommend to everyone in the House, and to those who accuse us of swanning off around the world, that they do not include any of those countries on their list of holiday destinations. I want to examine how the situation in those countries can shed light on NEPAD—the New Partnership for Africa's Development—and whether it supports President Mbeki's proclamation of the African renaissance that he wants to see in the new millennium.

I visited the Congo last August. Congolese people described the country as the heart of Africa. Many people will know of Joseph Conrad's powerful story, "Heart of Darkness", which was set in the Congo. As the Secretary of State mentioned, the country is the same size as western Europe. During the past three years, it has experienced an appalling civil war. That followed the ghastly legacy of Mobutu, which dates back to the cold war, Lumumba and the Belgian colonisation and all that involved.

The country is divided into three areas: the west is controlled from Kinshasa by the Kabila regime; the north-east is ruled by a client government of Uganda; while the south-east is controlled by a client government of Rwanda. None of those ruling groups has any legitimacy. The idea that Kabila should be president of the Congo because his adopted father—murdered a few years ago in suspicious circumstances—was the president lacks credibility; it certainly has no democratic legitimacy.

As many people know, the Rwandans and the Ugandans have legitimate security concerns in the Congo, as well as some less legitimate interests in mineral exploitation. We were told that about 800 sq km of virgin rain forest has been logged out in the area where the Ugandan army is operating. I do not know whether that is true.

In addition, the Zimbabweans appear to be looting diamonds in the south of the country. There were Angolans and Namibians in the country, but I am not certain whether they have pulled out. There are about 4,000 UN troops in the country—not a tremendous presence in a country the size of western Europe.

There is a list of problems. For example, there is an obvious absence of any form of education or health system in large parts of the country. There is grinding poverty and starvation. There are many internally displaced people, with all the difficulties that that entails. More than 2.5 million people have died during the past three years, because of the war and from starvation.

The country is fertile, however. It is rich in minerals and there is fantastic rain forest, which is a resource and a joy, yet there are dreadful problems and the situation does not appear to be improving. As a member of an African NGO said to us: "How beats the heart of Africa?" Not well.

Ten days ago I was in Sudan. Geographically, it is the biggest country in Africa. The south, which we visited, is fertile and the country has oil revenues, but a civil war has raged there for 35 of the past 46 years. About 2 million people have died during the past 19 years. There are 4 million internally displaced people. Slavery is practised by the Baggara—tribes on horseback. That is unbelievable in the 21st century. In the south, the Baggara have been acting as militia for the Government, and they may still be doing so.

There is a northern Government, based in Khartoum, who can be described briefly as a Muslim, Arab Government although the definition is not quite that simple. They have declared a jihad on their own people in the south, who are, in essence, black Africans whose religion is Christian or animist. In both the south and the north, there is appalling poverty; we saw only a tiny bit of it in a week, but we heard of worse things. In the south, I saw poverty such as I have never seen—it was extremely striking. Operation Lifeline Sudan will cost about $160 million this year. Thrown into that melting pot is the fact that between 1991 and 1996, Sudan was the home of Osama bin Laden, with all that that entailed.

The third country that I want to consider is Nigeria. It has the largest population in Africa: between one in four and one in five black Africans live there. The population is about 125 million, and one estimate is that it will probably grow to 141 million by the end of the decade. Corruption is endemic. As the Secretary of State acknowledged, two thirds of the population live in appalling poverty on less than a dollar a day, in an oil-rich country. The revenue from oil alone is $18 billion a year.

The rate of infection from HIV is about 5.8 per cent., yet 95 per cent. of the population use no form of contraception at all. As we left Abuja airport—which is something else—we saw that Abacha's photograph was still displayed. Abacha was so evil that the Select Committee has interviewed representatives of the Nigerian Government, who have demanded the return of the stolen money from UK banks. General Babangida—for many years the military dictator—continues to live in Nigeria in great luxury.

We met the independent commission on corrupt practices—a charming retired judge and his team. I am sure that they are well-meaning. They boasted that during the past six years they had indicted six people, two of whom were border policemen who had accepted a bribe from American travellers who wanted to enter the country. This was the same country where a former military dictator was living in enormous luxury with money looted from his country.

We passed through many checkpoints. At one, I saw a lorry driver throwing money to the police. Later that day, in Kaduna, I accosted a senator and asked him about the incident. He said that the lorry driver was probably just being nice.

Our consideration of NEPAD should start in the heart of Africa, in the largest country, and in the country with the largest population. Yesterday, the Select Committee interviewed representatives from the UNHCR, who pointed out that NEPAD made no mention of refugees and internationally displaced people. The UNHCR provided us with a document that stated: The issue of forced displacement has not featured explicitly in the discussions…of NEPAD. That is a matter of concern as there are so many displaced people around Africa owing to the conflicts there.

NEPAD is of course about development, but it identifies two priorities—peace and security, and governance—as conditions for sustainable development, with all that the two concepts entail. That is sensible, and I am sure that all hon. Members wish NEPAD well. However, action is required, not words, and we need to see evidence of good results, not just statements of good intent.

I am sure that the Secretary of State and her Department would largely agree with what I am saying—generally they have been doing a pretty good job on this and on other matters—so I am not raising a partisan issue. I support the Government in their efforts. I was particularly encouraged by the Secretary of State's comments about looking at the windows for peace in Sudan, Congo and Angola. I am delighted by her optimism, but not 100 per cent. convinced.

We must ask what, if anything, can be done. It is not easy, and none of us would pretend that it is; I certainly do not claim to have solutions. Nevertheless, it is worth considering what can be done in Congo. I saw the Rwandan ambassador yesterday; I think that she is a good person. There is a great security problem in Rwanda. Those hon. Members who have visited the country with the Select Committee on International Development—two or three of those present have done so—know of the awful genocide and what the Interahamwe, who are now in Congo, meant for the Rwandan people.

The international community must ask much more loudly what Zimbabwe is doing in the Congo and what role it is playing in the civil war, financially or otherwise. The Lusaka accords can work—they have a great deal of support—but more pressure must be applied to make them work and to bring about proper inter-Congolese dialogue, which was mentioned by the hon. Member for Putney (Mr. Colman), but seems to have stalled. The international community can help, but it must speak with one voice. When our Belgian counterparts held the presidency of the Commission last year, they tried to broker a deal that recognised the Kabila regime as that which governed the whole of Congo. On what grounds—le fils de papa? It is not good enough, and I appeal to the Government to do yet more.

On Sudan, I applaud the Government. The Secretary of State's visit in January this year, the appointment of former ambassador Goulty as her special representative, and the work of the United States in appointing Senator Danforth, were positive developments, but more is needed. I did not leave Sudan terribly encouraged by what I had seen. IGAD—the Intergovernmental Authority on Development—has the basis of an agreement, but it needs further pressure and support from us, from America, from the United Nations and from countries such as Egypt. Egypt views Sudan as part of what would have been called, during the cold war, its sphere of influence. It is for the Sudanese to determine what happens in Sudan, not for the Egyptians. I commend the Government for what they have done in Sudan, but urge them to do more.

Mr. Drew

As one of the famous four who went to Sudan, I am keen to hear what the hon. Gentleman has to say and entirely concur. Does he agree that part of the complexity of the problem is that as many peace formulas are being suggested as there are nations in Africa and, indeed, nations outside Africa, all of which have their own opinions? We need a co-ordinated effort between the north and the south to ensure that peace is secured at the earliest opportunity.

Mr. Robathan

I do not want to be drawn too far down that road, because my views on how serious both parties are about achieving peace in Sudan may not assist in doing so.

As we all know, the world has enough problems at the moment. In Sudan there is talk in the press of setting up camps to train mujaheddin to fight in Palestine and/or Afghanistan. That should bring home to us that this is not an isolated issue. The Sudanese Government under President al-Bashir came to power in 1989 with the National Islamic Front, and I believe that we had sanctions against Sudan from 1991 to 1996. Since then, the National Islamic Front has been transformed from a military dictatorship into a civilian Government, still under President al-Bashir and with almost exactly the same members, apart from Turabi. They have no more legitimacy now than they did when they seized power in 1989, neither do they have any more of a democratic mandate or any more justice on their side.

International pressure could bring about a greater chance of peace and greater agreement. The people of the south are determined to have self-determination—that may be another word for independence; who can tell?—and want a referendum. The Sudanese Government agreed to that at Asmara in 1998, and it should be held. The south is set on self-determination, but the northern Government are less than keen on granting it.

I turn again to Nigeria, where I fear that a time bomb is waiting to explode. There is galloping population growth, AIDS, an amazing juxtaposition of poverty and riches, governors not in the least interested in the governed, pressure on land, reports of 4,000 people killed in riots over Sharia law, and violence. It was apparent to me that on the streets there was violence of a kind that is not normally seen elsewhere. In one little street one afternoon I saw people attacking one another. Nigeria is so important, and the people of that enormous country must take responsibility themselves. President Obasanjo speaks the right language, but he is not taking the necessary action.

I remind the Minister of a letter that he sent me this week about a company that I have mentioned before—Julius Berger, a German construction company that has cornered the market in construction sites around Nigeria, not least an enormous modern stadium that is being built in Abuja, and makes the dome look cheap and well organised. It is a byword for corruption on the streets of Abuja. I shall not go into everything that I said in my letter to the Minister, but in his reply he says that he is not aware of any allegations concerning the company. I point him in the direction of the Nigerian press, which contains clear allegations, if not proof, about the matter. It took my researcher, who is rather good at such things, about five minutes to run them off the internet. People on the streets of Abuja and in our high commission are aware of those allegations.

In his letter, the Minister says that if I have specific allegations I can contact the anti-corruption commission in Abuja. While we were there, we talked to a delightful and well-meaning retired judge. I mentioned General Babangida and asked how a man who had looted his country could live in such luxury, holding court, in Nigeria. He said that nobody had come forward with allegations about that. I said that I could show him a book by Karl Meier called "This House has Fallen", which contains a long list of allegations. Up spoke a rather grave person from civil society who said, "The point is, Your Honour, if you make an allegation about this, you are likely to disappear the next day." So not many people are willing to put themselves forwards as witnesses in court. I think that we all understand that. I say to the Government that if we, as a friend of, and donor to, Nigeria do not pursue these allegations with our European partners such as Germany, we will not be doing Nigeria any good.

I have spoken for long enough, and although I wanted to concentrate on Africa, I have not discussed in any depth AIDS, the ghastly black death that is stalking the whole of sub-Saharan Africa, and I have hardly dwelt on poverty. I am an optimist by nature, but it is difficult to be optimistic when one has seen some of the things that we on the Select Committee have seen. Certainly there is cause for optimism in some countries, which the Secretary of State mentioned. In many ways, Rwanda and Uganda are beacons of hope, but it is a pity that they are both involved in the war in the Congo. There is peace between Eritrea and Ethiopia, although as the Secretary of State so rightly said, what on earth were they fighting about in the first place?

We need to look at the state of that poor benighted continent. I have picked two items from today's media. The first says that Zimbabwe is threatening its 12,000 Asian traders. Is not this where we were in 1971 or 1972 with President Amin? Have we learned nothing in 30 years? The second is a report on the BBC this morning about the state of starvation in Malawi. I do not know a great deal about Malawi, but I do know that there are serious allegations of corruption there. It is desperately sad when a country that is fertile ends up with starvation.

I commend DFID for its strong stand, but I urge it to be a little stronger on the question of good governance and corruption. We do no favours to Africans in Nigeria or anywhere else if we keep quiet, if we are diplomatic and if we pull our punches. We need to tell the truth. The world has problems enough in the middle east and Afghanistan. The global village is a dreadful cliché, but it is true that there is a link between Osama bin Laden, the mujaheddin and whatever else one wants to mention. Let us support NEPAD and wish Africa well, but let us not use wishy-washy words and pretend that things are going well when they ain't. The scale of the problem of governance needs to be understood. The kleptocrats who run much of Africa need to know, as they drive in their Mercedes cars past the peasants who have no shoes, that the world will not support such behaviour.

More than anything, Africans and African Governments must take responsibility for themselves. "The Case for Aid for the Poorest Countries" says: Without serious action by poor country governments to address valid governance concerns, there will be no breakthrough on building support for increased aid, and limited development progress. The Department's annual report, published yesterday, says: Aid works only when developing countries themselves drive the reform agenda. The Government are absolutely right, and I wish them well. We need to show ourselves to be serious, as the African Governments must show themselves to be serious, about working towards just peace, conflict prevention, good governance and reforms, and then our development aid can be so much more effective in meeting the huge challenges in Africa.

4.43 pm

Hugh Bayley (City of York)

The frighteningly high vote won by Jean-Marie Le Pen in the first round of the French presidential election has sent shockwaves across Europe, and it should concern particularly those of us who are interested in international development. We need to ask why so many people in France—it could be as many in this country—rally behind a racist xenophobe who simply does not realise that, in this globalising world, each of us in Europe is, as my hon. Friend the Member for Leeds, West (Mr. Battle) made clear, linked with others in the world, and our livelihoods and prosperity are interdependent.

What happened in France ought to remind us all that both time and distance play terrible tricks on memory. It is 60 years since the first French Jews were deported to Auschwitz on 27 March 1942. Saturday 4 May, the day before the second round of the French presidential election, will be the 60th anniversary of the day when the first Jews were gassed in Auschwitz. Every single voter in France should reflect on that on the day before they cast their vote. Everybody in France should remember that 83,000 French citizens were sent to the death camps—an episode that Jean-Marie Le Pen describes as a footnote to history.

Here in this country—in Burnley, Bexley, Enfield and everywhere else that the British National party has candidates in elections in the same week—we need to reflect on where fascist ideology leads. We need to address the political issues that lie beneath what is happening in many countries in Europe, such as the social deprivation and the divisions that allow extremism to grow.

It is not only time—the passing of 60 years—that allows a memory to fade; it is also distance, which allows us to forget, or not to notice, human rights abuse, hunger and disease in other parts of the world. If we, the rich world, do not address injustice and the causes of poverty in developing countries, not only do we fail in our moral duty, but we allow conditions in which extremism in those countries will grow. We know from last autumn that that can have appalling consequences, both for people in developing countries and for us in the developed world.

That is why we need to break through the blocks in our collective memory, and why the financing for development conference in Monterrey is so important. The Zedillo report, commissioned by the United Nations, estimated that if we are to achieve the millennium development goals by 2015, we will need collectively to invest in aid some $50 billion more than we do now every year until 2015.

Real progress was made at Monterrey. The EU, under pressure from our Government, including the Chancellor of the Exchequer and the Secretary of State for International Development, agreed to increase its share of GNP devoted to development assistance from 0.32 to 0.39 per cent. by 2006. That will contribute an additional $7 billion a year in aid. In addition, the United States agreed an extra $5 billion a year in aid for each year from 2004 until 2006. That shows the importance—this point might have been better made in this afternoon's debate in Westminster Hall—of engaging with our ally, the United States of America, and of seeking its help in terms of working for important political goals from Europe. I see the fingerprints of our Prime Minister's conversations with President Bush—if I am not mixing the metaphor too much—in that decision by the United States President.

Mr. Simon Thomas

Clearly, the sums agreed at Monterrey and under the comprehensive spending review are significant and important. Nevertheless, does the hon. Gentleman recall the Secretary of State's intervention on the hon. Member for Richmond Park (Dr. Tonge) when, as I understand it, she confirmed that debt relief was included in the figure as a percentage of GDP? Although such sums show increasing progress in this country, we cannot say that we have met our UN targets until we hit 0.7 per cent. in overseas aid.

Hugh Bayley

The hon. Gentleman is absolutely right. He could have been reading the next line of my speech. I thank him for that—I need not read that particular line; it can be taken as read.

Very significant progress has been made, and it has been led by this country. However, we are nowhere near the 0.7 per cent. target, or the Zedillo target of an additional $50 billion a year. The world's current official development assistance spend is some $54 billion, and Zedillo proposes a doubling of official development assistance to some $100 billion or £105 billion a year, in each year between now and 2015, if we are to meet those goals. The Monterrey pledges by the United States and by all the member states of the European Union acting together will provide an additional $12 billion—an increase of some 20 or 25 per cent. That is a significant amount, but it is by no means enough to attain those development goals.

That was acknowledged by the Chancellor of the Exchequer in the Red Book that he issued on Budget day, as my hon. Friend the Member for Leeds, West pointed out. The Red Book states that, because the Monterrey pledges have not met the target set by the UN or by the World Bank, The UK will continue to seek further progress, to ensure that no developing country genuinely committed to good governance, economic reform and poverty reduction will be denied the chance to achieve the Millennium Development Goals through lack of finance. If that will not come from the pledges already made, we must ask ourselves and the Government where those additional resources will come from. The hon. Member for Banbury (Tony Baldry) said that we should look in closer detail at the Chancellor of the Exchequer's proposal for an international development trust fund. That is a good idea and I second the proposal. As Members of the House, we should give whatever support we can to the Chancellor's proposal and, in our contact with parliamentarians from other countries, we should talk up his suggestion of a trust fund to pool resources of donor countries and to attract additional contributions from the private sector.

We should also consider the proposals made by George Soros and others to allocate additional special drawing rights to developing countries. The last time that the Bretton Woods institutions allocated additional SDRs was, I think, in 1981. Those institutions are in a position to issue further SDRs, and we should consider that seriously.

I agree with my hon. Friend the Member for Putney (Mr. Colman) that we should consider the Tobin tax, which is gaining greater international recognition. There are some problems, however, with seeking to generate revenue for development by taxing currency transactions. International trade might slow as a result, which could be harmful to developing countries. Furthermore, the euro zone might see a competitive advantage in placing a tax on currency transactions for those trading partners that have to exchange currencies to trade, as it would not apply within the euro zone. To put those fears at rest, if the Tobin tax were introduced, perhaps the euro zone should propose an additional contribution of its own. Nevertheless, the Tobin tax is an important proposal, and we should consider its potential for contributing to development.

If we are to bridge the Zedillo financing gap, we need to consider reforming the terms of trade. Most hon. Members touched on that. I hope that the debate gives my right hon. Friend the Secretary of State the clear and direct message that hon. Members on both sides of the House think that the development agenda needs to focus sharply on how the Doha trade round delivers for poor people in poor countries.

We know that private sector financial activity contributes far more to the GDP of even sub-Saharan Africa than aid does. We also know that the least developed countries provide and receive a declining share of trade. The World Bank estimates that had Africa maintained the share of trade that it had in the late 1960s, its income would be higher by some $70 billion a year, and the Zedillo gap would not exist.

Trade has the potential to narrow the financing gap if there is a greater volume of trade between developed and developing countries. However, if it is to provide benefits for poor people in those countries, the terms of trade need to change. We need to focus in particular on agricultural subsidies, as the hon. Member for Banbury said, and on intellectual property rights, which have acted as a barrier to the purchase of certain medicines in developing countries.

In addition to measures such as special drawing rights and the Tobin tax, we should try to create a goal—or, better still, a financial instrument—that provides an incentive to increase aid and at the same time to lower trade barriers, so that we increase trade between the least developed countries and developed countries. The first thing to address is the need to lower export subsidies from rich countries, which cost us some $1 billion a day. Rich countries spend five times as much on export subsidies as they do on development assistance. Oxfam's report "Rigged Rules and Double Standards", published a couple of weeks ago, makes the point that export subsidies do not just cost us money, but cost developing countries about $100 billion a year, which is twice as much as they receive in aid.

We need to liberalise our economy to get rid of export subsidies, because they harm development. We also need to encourage developing countries to liberalise their economies. The Tinbergen Institute estimated for the World Bank that developing countries would stand to gain up to $155 billion a year if they further liberalised their economies, which is three times the amount they receive in aid.

Perhaps alongside the 0.7 per cent. of GDP development goal, a second development goal could aim to increase the volume of trade to least developed countries by a certain percentage by 2015. Perhaps we should even increase the level of overseas development assistance and decrease export subsidies so that by 2015, or some other date, they are in balance. If we agreed such a goal, it would provide an incentive for people involved in trade in all developed countries to address the difficult issues, such as agricultural subsidies and textile tariffs, which need to be addressed if there is to be a prospect of meeting the millennium development goals.

We should consider also not only where the money comes from but where it should go. We should be guided by the Secretary of State's excellent report, which, like other Members, I welcome. It shows that the Government have a strong record of achievement and of global leadership on international development. It shows also, with commendable clarity, where the international donor community is falling down.

Globally, although we may be moving towards achieving the millennium goals, we are not moving fast enough to achieve them by 2015. At page 59 of my right hon. Friend's report, a graph shows with great clarity that in sub-Saharan Africa we are making progress on primary education enrolment, an issue on which the hon. Member for Richmond Park (Dr. Tonge) touched, but that virtually no progress has been made on moving towards the poverty alleviation goal. It shows also that the public health measures are worse now than they were in 1990. Infant mortality in sub-Saharan Africa is worse than in 1990, and becoming worse still. The percentage of births attended by a trained and skilled health worker is also declining.

The lessons that I draw from the graphs in the report are that a greater proportion of our aid should go to sub-Saharan Africa. Other Members have mentioned the Select Committee's report on EU aid, which shows that over the past decade the proportion of aid going to low-income countries has fallen from 76 to 39 per cent. in 2000. I know that my right hon. Friend the Secretary of State is as keen as any member of the Select Committee to increase the proportion of EU aid that goes to the least developed countries.

I believe that the slide away from aid to the poorest countries has been tolerated within the EU because it has not been clear enough where EU aid is going. That is because, unlike each member state, the EU itself does not report how it spends development assistance money according to the OECD's development assistance committee criteria. We in the UK know how much of our aid goes on primary health care, on clean water and on trying to meet primary education enrolment goals. People in the Netherlands, Sweden and France know the same. However, if such questions are put to Mr. Poul Nielson, the EU Development Commissioner, he has to say, "I am sorry, I don't know the answers. Our reporting systems do not provide that information."

To the EU and the Commissioner's credit, they have agreed that they should be able to answer those questions. However, the single most important reform that the EU could make in order to show that it realises that what is happening now is wrong and must change, is to create mechanisms that show where EU development assistance goes. As EU development spending will increase substantially over the next few years as a result of a deal won by my right hon. Friends the Chancellor of the Exchequer and the Secretary of State at the financing for development conference, it is all the more important to ensure that the increased stream of funding goes to help the poorest people in the poorest countries. If it does not, we shall not meet the millennium development goals.

I shall quickly highlight two other points. There is the need to tackle conflict prevention in Africa, which my hon. Friend the Member for Lancaster and Wyre (Mr. Dawson), having just returned from the Sudan, will want to discuss. I welcome especially the appointment of Alan Goulty as the special representative of my right hon. Friend the Prime Minister. I met him when I went to the Sudan six years ago. He is an excellent diplomat, an Arabist through and through, and he is totally committed to the future of the Sudan. If anybody can act as a bridge and enable the peace process to move forward, it is Alan Goulty.

Secondly, on health, we had some very good analysis of the public health problems in developing countries from the independent commission on macro-economics and health, and we had two good proposals from the Chancellor in the Red Book: first, to create a tax credit for research and development of vaccines and medicines to prevent and treat malaria, TB and AIDS, which I warmly welcome; and, secondly, a relief for responsible donations of medical supplies by UK companies. Those are good initiatives, which I am delighted to see.

Access to necessary and cost-effective drugs should not be discretionary. There should be a right of access to basic health care for poor people in poor countries, just as there is a right of access to health care for richer people in a country such as ours. That means that we need to amend the TRIPS agreement—the World Trade Organisation's agreement on trade-related aspects of intellectual property rights—in a way that retains the patent protection of pharmaceutical drugs in developed countries, without which pharmaceutical companies will not continue to invest in researching and developing the new drugs that we all, in the developed as well as the developing world, want, but which also extends to poorer countries the opportunity to purchase cheaper copies of patent-protected drugs.

That opportunity should be available to all countries, not just to those manufacturing copies under licence. If we fail to resolve this issue in the Doha negotiations, it will be unethical. The trials of drugs to tackle AIDS, TB and malaria must by their nature take place in Africa, where there is a large concentration of people suffering from those diseases, and it would be medically unethical to use Africa to trial drugs for use in other parts of the world and not to make those drugs available to people living in Africa.

Finally, I propose the creation of an international panel on medical ethics, from which the pharmaceutical industry should seek ethical clearance both for trials of drugs in developing countries, and for the licensing of the manufacture and distribution of pharmaceutical drugs in the developing world. I urge my right hon. Friend the Secretary of State to ask her health officials to examine the practicality of such a proposal, and to discuss it with Gro Harlem Brundtland, Director-General of the World Health Organisation.

5.8 pm

Mr. Simon Thomas (Ceredigion)

Not only did I anticipate what the hon. Member for City of York (Hugh Bayley) would say with reference to the 0.7 per cent. target; he anticipated what I would say with regard to TRIPS and the health needs of developing countries.

On behalf of Plaid Cymru and the Scottish national party, I put on record our welcome for the debate, which we hope will become an annual event. We are pleased to have the opportunity to take part in it, but I have one small suggestion to make. The Order Paper should refer to the annual report as the relevant document for the debate. It would be useful for other hon. Members to realise that this was an opportunity to hear what the Government have been doing during the past year.

The debate has been well attended, considering that local government elections are taking place somewhere or other, though not in Wales. Those participating, however, tend to be the usual suspects. Although the standard of debate has been very high, I am sure that if we had an opportunity to widen the forum, other Members might be called to speak.

Mr. Robathan

We might not get called.

Mr. Thomas

Well, that might happen, but let us hope that other Members at least come along to intervene and ask questions about the report and that the debate becomes an annual event.

The debate is also worth while because this is the Global Campaign for Education's week of action, which reminds us about the central goal of ensuring that its action plan on free primary education for all should be decided by the end of this year. I hope that the Minister will say in his winding-up speech whether he thinks that that action plan is on track to be agreed by the end of this year. However, I want to confine my remarks to the TRIPS regime and GATS and to some of the difficulties that we need to address to deliver health care to developing countries.

There is obviously a disproportionate burden of death and illness in developing countries, especially because of HIV/AIDS, tuberculosis and malaria. Some 2.4 million people have died of HIV/AIDS in sub-Saharan Africa. A further 25.3 million people in the region are HIV positive, of whom only 25,000 receive the drugs that could revolutionise their treatment. Many of those drugs are still under patent.

Under the TRIPS agreement, many countries that presently produce generic drugs, such as India, will need to abandon that production under a new system of patent protection by 2005. We have to review how the new system progresses. It is clear that generic drugs are much cheaper because there is a competitive market and no research and development costs. A triple combination treatment for HIV/AIDS costs $930 per person per year, whereas a generic version of that treatment is available for $250 per person per year. Nevertheless, we have to take into account the fact that per capita spending on health in Africa is about $10 per person per year, so there is still a huge gap to overcome.

I had an opportunity to see the health interaction between this developed country and developing countries this week, when the Nigerian Minister of Health, Professor Nwosu, visited a company in my constituency. The company, Micropharm, produces snake venom antidotes using sheep. We have a few sheep in Wales, but not so many snakes.

Mr. Robathan

There are snakes, too.

Mr. Thomas

The hon. Gentleman may know that, in Wales, people from Aberdare, as I am, are known as snakes.

The sheep are not threatened and I am not talking about animal experimentation; they are simply used to produce the antibodies to the snake venom. Those antibodies are exported to developing countries, especially those in Africa. In Nigeria, 1,000 deaths a year are caused by the carpet viper. Micropharm produces the antidote to that snake's venom in my constituency.

Incidentally, Micropharm has a wonderful stock line. A bit like the Trotters' van, it says, "New York, London, Ffostrasol." That is a wonderful way to bring home to us all the international aspects of things that happen in our constituencies. I want to put on record my thanks to Professor John Landon, who was responsible for establishing that company and who works in those three towns, which are, of course, in three countries.

One of the difficulties is how to get our best technology and medical understanding into developing countries to help them. TRIPS is obviously designed to help by protecting patent rights to encourage companies to undertake research and development and to supply the resulting products to developing countries, where they will presumably be bought by money from the developed countries' overseas aid budgets. I suppose that that could be called a virtuous circle.

There are some difficulties with TRIPS however and some exemptions to the way that it works. I understand that an exemption can be made in national emergencies. I think that the United States Government used that exemption after the events of 11 September to increase the production of anthrax vaccine for its domestic market. One of the key issues that we need to consider is how we can ensure the domestic availability of medicines under the new TRIPS regime.

After 2005, developing countries that do not have a domestic capability for developing generic medicines will no longer be able to buy those generic drugs. That is my central concern. Countries that produce them now, such as India, will have to come under the TRIPS agreement by 2005. That leaves other developing countries to develop generic medicines for their own domestic markets, but I am not convinced that they will have developed the necessary capacity to do so by 2005 or even by 2016, which is the latest possible date for the least developed countries.

The problem was recognised at the WTO meeting in Doha in November where there was a declaration on TRIPS and public health. That declaration agreed that the primacy of public health over intellectual property rights should be protected and agreed the rights of Governments to use public health safeguards within TRIPS. The Doha declaration said: We recognise that WTO members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing under the TRIPS Agreement. We instruct the Council for TRIPS to find an expeditious solution to this problem and to report to the General Council before the end of 2002. The problem has been recognised and there is an instruction to find a solution to it.

I have received a suggestion from Oxfam as a possible solution to the problem. It is the removal of TRIPS restrictions on exports of public health-related products. Under article 30, the TRIPS agreement could be amended or interpreted in such a way as to allow countries to export generic versions to countries that cannot manufacture them themselves. That would be a simple way of overcoming the possibly temporary, but nevertheless real, difficulty that TRIPS in its present form may present for some developing countries. I understand that the European Commission in its own paper has more or less gone along those lines. The African Group has also called for a similar approach.

Hugh Bayley

I agree with the hon. Gentleman's approach. It will be necessary also to build in some mechanism that stops what the pharmaceutical industry would call parallel trade—the selling back of drugs from poor countries where they are available at low prices to rich countries. If that happened, pharmaceutical companies would not make the profits to pay for the research and development of drugs that we all want. Does the hon. Gentleman agree that that is an important nut to crack as well?

Mr. Thomas

I agree completely. It is important to avoid that. It would lead to exploitation on all sides and would not help developing countries at the end of the day. I understand that the UK Government have set up an independent commission to look at TRIPS. No doubt it will examine those issues. We look forward to a report on that and possibly even a further opportunity to debate these matters on the Floor of the House.

TRIPS does not just affect health; it affects access to knowledge, software and so on. It is important to emphasise, as all hon. Members have done, that if we are to achieve health improvements in developing countries, particularly in sub-Saharan Africa, it comes down to money. With TRIPS or any other agreement, it comes down to how much money we can release into development in those sub-Saharan countries. That, in turn, comes down to getting our 0.7 per cent. target and a timetable to achieve it on the Government's agenda. It may be on the agenda, but it has not yet been agreed.

Related to TRIPS is the General Agreement on Trade in Services. One side of the health coin is the provision of medicines and the other is the provision of public services, such as clean water and sanitation. There are some concerns with the current GATS negotiations, and I shall touch on them briefly. We have perhaps not yet had the opportunity in Parliament fully to scrutinise GATS. I am not aware of a debate having taken place in Westminster Hall or on the Floor of the House, yet there seems to be increasing pressure within the GATS regime. In theory, liberalisation does not necessarily lead to privatisation, so GATS should be at the heart of the way in which developing countries improve their economies. We have as much obligation to lower our trade barriers as those countries do to operate in an open and liberalised market, but that could lead to increasing emphasis on the privatisation of public services and we could exclude developing countries from the virtuous circle that we have achieved in this country.

I am slightly concerned that the United Kingdom has missed a trick in GATS. Given our increasing use of private health companies and the private finance initiative to meet our needs, it could be argued that GATS will start to affect our own public services. Whether or not one accepts that argument—the Government obviously do not—we need a debate in the House on GATS. It is also clear from the report of the International Development Committee and an early-day motion signed by 262 MPs that we need an independent assessment of the way in which GATS affects services in this country and, more importantly, services in developing countries.

Finally, we must complete the circle. In a recent inspiring speech to the London School of Economics, Kofi Annan, the United Nations Secretary-General, talked about the road to sustainable development from Doha via Monterrey to Johannesburg which is bringing together trade, development and environmental issues in a unified package to support sustainable development and maximise our contribution to it. I want to draw the attention of the House to three key recommendations in the report of the Select Committee on Environmental Audit on which I serve. First, the world summit on sustainable development provides the best opportunity to establish a framework for integrating trade and sustainable development agendas. Although the Environmental Audit Committee does not agree, corporate social responsibility should be on the Johannesburg agenda, and we should work towards an international agreement on it. The Johannesburg summit should be the key reference point for future negotiations on TRIPS, GATS and so on.

Secondly, we need a better evaluation of the UN's commitment to the summit, as some countries are not pulling their weight. In particular, are we doing enough in the European Union to allow all countries fully to participate in the summit and have their voices heard? Finally, we must ensure that agreements on financing development, particularly those made in Monterrey, are linked to action plans agreed in Johannesburg. If we do not do so, Johannesburg will be just another talking shop. Whatever Rio's faults, our understanding of the environment is much clearer thanks to that summit than it was 10 years ago. In 10 years' time, this country's understanding of development issues and the alleviation of poverty should be as clear as our understanding of the environment post-Rio. We have an opportunity to begin that process in Johannesburg, but our understanding must be linked to serious action plans.

5.23 pm

Tony Worthington (Clydebank and Milngavie)

I am relieved that another annual report has not come out while I have been waiting to speak; however, it is a joy to have an opportunity to contribute to our debate.

I want to talk about a crucial issue that many people have mentioned—trade. The theme of my contribution to the globalisation and anti-globalisation debate is the issue of when we need more freedom and when we need more regulation. The territory is incredibly complicated: some people say they are for globalisation without qualification and others say they are against it without qualification, but both groups are wrong. I praise the Secretary of State and the Department for the report; the complexities of the issues that it tackles make them the most intellectually taxing that anyone has to deal with.

I raise the issue of trade because I fear that we are simply not doing enough on many aspects of trade and are not reducing poverty as much as we could because we are not sufficiently focused on trade. I use the word "trade" in a very broad sense, to cover any exchange relationships between the developed and developing worlds. I shall speak mainly about Africa, because I am afraid that it has become my obsession, as it has for many others.

Sub-Saharan Africa now accounts for only 1.3 per cent. of world trade—one third of its share at the beginning of the 1980s. It is falling behind, and the faults lie in the countries themselves and in our part of the world. While they are falling behind, we and they are stimulating terrorism, poverty, the collapse of the rule of law and so on. In the words of Mike Moore, director general of the World Trade Organisation, poverty is a time bomb lodged against the heart of liberty". In passing, I should like to praise Mike Moore. If ever a person received a hospital pass, he did so by taking over the WTO just before Seattle. If there was ever an inheritance that one would not have wanted, that was it. However, we passed through the years and arrived at Doha. Everyone will find limitations to Doha, but the organisation was a stable one and progress could be made. If the WTO had been destroyed, it would have been a major setback for development in the world. Even now, trade in developing countries generates more than 30 times as much revenue per capita through exports as those countries receive in aid. In the words of the Secretary of State for Trade and Industry after Doha, it has been estimated that halving protection in agriculture, industrial goods and services could boost developing countries' incomes by around 150 billion dollars a year—three times the value of all aid budgets put together. As I said, I am interpreting the concept of trade very broadly to include all the economic interchanges between rich and poor nations. For example, it includes the trade in people. I do not have the slightest doubt that we exploit the developing world in terms of its people. We may put in some funds for primary education, but we then rake off enormous benefits from those countries' talented people. As my hon. Friend the Member for City of York (Hugh Bayley) will recall, we were told in Ghana and Nigeria that there were more Ghanaian doctors around New York than in Ghana. The number of Indian scientists in the United States is colossal. Many developing countries hate to see their brightest and best go to American universities because they do not come home. The United States is not only the least generous of the G7 countries in terms of its aid assistance, which is often tied and provided on political rather than humanitarian grounds, but is the most extractive from the developing world in people terms.

We are rightly putting a lot of emphasis on universal basic education, but that will not pay off as much as we would want if we, the Americans and other developed countries pick off the brightest and best in what resembles a modern version of the I I-plus, whereby we put in the primary education but many of the brightest and best do not serve their country. They must have individual liberty, but it is worrying that one of the consequences of providing what we call aid is that we then help ourselves. In people terms, that happens a lot.

We know that that is the case because we are concerned in this country about how we are seeking to make good our shortage of teachers, nurses and scientists by taking a disproportionate number from the developing world. I think that we should have an analysis of the balance of trade in people. DFID was working on such a project some time ago, but I wonder whether there has been any real analysis of the account with regard to what we put in to help people and what we take out in terms of people.

Another aspect of trade is the trade in money. A great deal is said about the need to have foreign direct investment going into developing countries, but how can that work if the locals, and others, ship it out to money markets around the world in greater quantities than are coming in? I welcome the fact that some of the Nigerian Abacha money is to go back to Nigeria. Let us take that case as the most glaring, foul example. The Nigerian Government were seeking to reclaim £4 billion that had been taken out of Nigeria by one family. DFID's worldwide budget is £3.5 billion. One Nigerian family took £500 million more out of Nigeria than this country put into the developing world. Money is being extracted on that scale.

This is where the issue of regulation comes in. That we have allowed successive Nigerian Presidents, as well as Mobutu, Mugabe, Milosevic and Saddam Hussein, to get richer while we criticise them is simply scandalous. Similarly, huge amounts of Russian money have left the country and been recycled while Russia gets poorer. I am told that about 9,000 Russian firms are registered on the island of Cyprus. Movement of money is happening on that scale. Until 11 September, we were incredibly dilatory about all this. Afterwards—I remember the announcement—it was suddenly discovered that a large number of bureaux de change in this country were involved in money laundering. I just wonder how long that had really been known, without being acted on.

I hope that the return of the Abacha money is a sign of better things to come, but I am not sure. On our visit to Nigeria—we were the first Select Committee to go there following the return of democracy—I could find no one who knew what was happening to the oil revenues. In theory, it had been the military who had been stealing them. As I went around I asked people, "Can we see the accounts?" This ought to be a simple process: Shell extracts oil; it has a value; some of the revenue will go to Shell and some to Nigeria. Yet it is impossible to get the answer to the question of where those oil revenues are going. In theory, if democracy and transparency have taken over, we should be able to see lots of schools and clinics opening, and lots of benefit to the Nigerian people. I can only conclude, because no one could point any of those things out to us, that the "food chain" remains pretty well undisturbed. Abacha and Abubakar may have gone, but the corruption carries on. That is simply not good enough.

The issue of oil revenues takes me on to other areas in which the rules of the WTO are simply irrelevant. These include diamond smuggling and timber harvesting. We have been extremely slow to realise the importance of setting up proper regulation and policing systems, and poorer countries have been plundered of their natural resources. Sierra Leone and Angola, for example, became totally ungovernable. Countries that were literally sitting on diamond mines or oil fields were plunged into poverty.

A small London-based NGO, Global Witness, found out more about the diamond issue in Sierra Leone and Liberia, and about how the forests of Cambodia were being plundered until they were virtually extinct, than all the intelligence resources of the world's Governments could find out. We must act on that information. I praise Global Witness for its achievements; I believe that it now has some ideas about how we could tackle corruption more effectively from the British company end than we have done so far. I look forward to hearing them.

I used to think of corruption as pilfering or slippage—not very serious—but I now think that corruption in many so-called developing countries will prevent any growth at all. Its eradication is crucial to any progress and there must be more regulation. That requirement is reflected in part by the fact that the number of tax havens has grown astronomically in recent years.

We used to be able to reel off the tax havens—the Cayman Islands, Jersey, Guernsey and so on—but now the books show that there are tax havens everywhere. That, in part, is also down to the Americans, as they have stimulated free trade and there is a lack of regulation. However, following 11 September, we must come together and get the Americans on our side over development. As the hon. Member for Banbury (Tony Baldry) and my hon. Friend the Member for Leeds, West (Mr. Battle) said, a lot of us are being invited to America to talk to Congressmen and Senators. The whole business of tax havens must be tackled.

To me, trade also involves firms' trading practices and their impact on the welfare of citizens. That is another aspect that we do not consider enough. How much avoidable death, sickness and poverty does the developed world thrust on the developing world through its trade practices? Let me give an example that is close to my heart and that of my hon. Friend the Member for Leeds, West. My constituency has a major problem with the legacy of asbestos. Only a couple of years ago, all forms of it were banned in Europe, although it has been known for decades that asbestos kills. The same firms that we have banned from selling in Europe are operating and killing in the developing world by forcing people to work without protection.

If there was ever a case of corporate manslaughter, that must be it, so I was delighted recently when former Cape Asbestos workers in South Africa received compensation in our courts. However, we still allow that form of free trade to persist. That is not acceptable, and we need more regulation. As my hon. Friend the Member for Ealing, Southall (Mr. Khabra) said, we must also tackle the practice of dumping out-of-date drugs and giving them to people who do not know how to use them, which causes more harm than good.

A number of Members have referred to AIDS, which is dramatically reducing life expectancy in Africa. We must face up to what the free market is doing: large, unrestricted sums of private money go into research on keeping prosperous Americans and Europeans alive, because that is profitable for the pharmaceutical companies, but hardly any private money and only limited sums of public money go on research into a vaccine that would prevent poor Africans from getting the disease in the first place.

It is obvious that there ought to be better protection for women, who must gamble on men being responsible, which has always been a pretty dodgy thing to do.

Dr. Tonge

Hear, hear.

Tony Worthington

That is obviously the hon. Lady's experience. The serious point is that the money available for research into microbicides, which are a barrier to women catching HIV from their partner, is extremely limited. There must be much more regulation and much more direction of money in that area, because liberal trading alone simply will not work.

Another area in which our trading policies are not working is sustainable development, which we are not adequately pursuing, and because of that we are promoting future poverty rather than development. It sickens me that, having emptied the seas around Britain, our fleets are now emptying Africa's seas. We should listen to the Namibians about the fishing practices of the Spaniards—it is like going back 10 years to the fishing practices of the Spaniards in this country. They must be regulated, and should not be left to free trade.

We say that sustainable development is a major part of our policy across government. The only problem is that the Government cannot find any case in which damage to sustainable development was sufficient to prevent an arms-related export. I am waiting for an answer to a parliamentary question, which the Secretary of State says she has not seen, on whether arms sales to Africa, apart from South Africa, have gone up. At the end of last year, we managed to achieve the feat of wiping out much of Tanzania's debt with one policy initiative, and increasing its debt with another, through the sale of an inadequate, expensive and inappropriate air traffic control system.

Trade is immensely important, but we need to interpret it much more widely than we customarily do if we are to get a handle on it. I am in favour of freer trade, but it must be ethically steered. If free trade is allowed to run unregulated, the rich and the bully win. The wrong regulations can be equally devastating.

The European Union is full of people who, from the days of Willy Brandt and "North-South: A Programme for Survival", swear that they are in favour of development and ending poverty, but nevertheless created that abomination called the common agricultural policy, which favours rich farmers in rich countries. Food surpluses are dumped in the third world, and until recently there were tariffs against the poorest farmers in the poorest countries. We impose on poor farmers the obligation that they should not have barriers to our goods if they are to receive poverty reduction assistance from the World Bank.

Last year, we did not even have the boldness to give free access to developing world sugar under the everything but arms initiative. That had to be phased in, although its impact would be minimal. I like what Oxfam says in its admirable document "Rigged Rules and Double Standards". It has constructed an index of double standards, and the European Union wins by a short head from the United States, although that was before the US raised its steel tariffs, so perhaps it has edged ahead.

I have spent some time on the matters that we usually think of as involving trade. Over the past few years, I have become convinced that many countries in Africa are nowhere near an economic breakthrough. There have been some success stories, as the Secretary of State said. I would add horticulture in east Africa, the diamond industry in Botswana and the Customs regime in Mozambique, but they are too few and far between. Often, no progress seems to have been made at all.

I am sure that many of the conversations that members of the Select Committee had in Ghana and Nigeria about economic development could have been had at any time in the past 50 years. Cocoa growers receive a pittance for their cocoa beans, and take massive cuts when commodity prices fall. The big chocolate firms do not allow them to go into value-added territory, and they are faced with big tariffs on any value-added goods that they have.

I do not know whether my hon. Friend the Member for Leeds, West was with us when we went to a cable maker in Ghana. It mined the aluminium in Ghana, which was sent to Belgium to be processed and then sent back to Ghana to be converted into cable. The wastefulness and exploitation of that process is wrong.

If I dare, I shall say a little about the CDC. I hope that I shall not incur the Secretary of State's wrath. I have listened to the debate on the CDC, and I think that there is probably some common ground. I am sure that the Secretary of State is familiar with the concerns, shared by many hon. Members, about the direction in which the CDC is going. It may be doing well in new areas such as extending the use of mobile phones, call centres, and investing in banks. Such measures may well be sensible and may generate wealth, and it is true that it is slightly patronising to argue that the CDC should be concerned only with the primary industry of growing crops. However, as it moves into such new areas, we should remember that it is no longer involved in farming and agriculture, in which far too little is happening.

I want to return to an issue that we discussed in Westminster Hall. We frequently hear that some 80 or 90 per cent. of the populations of developing countries depend on the soil for their livelihoods. Those populations are doubling every 25 to 30 years, but few of those countries are achieving a growth rate that will exceed such increases. Regardless of profit, we must make the land more productive, so that people in the countryside can be fed and can maintain decent livelihoods, because the cities cannot cope. We must improve the life of people in the countryside, and hopefully we can also improve exports.

However, I did not sense that many of the countries I visited have an agricultural policy that uses the land to its full potential. In some countries, it is appallingly difficult to establish such a policy. Because of inheritance rules, land is repeatedly divided up, and for all manner of cultural reasons land policy is very difficult to change. Northern environmentalists resist putting our science to work because they insist that developing world farmers have all the wisdom—despite the fact that, without change, there will be deepening poverty, huge infant mortality rates and the perpetuation of squalor. In addition, one can predict desertification, an even greater lack of access to water, and the elimination of forests.

I am simply raising with the Secretary of State my concerns about the neglect of agriculture. It is true that there are success stories. Interestingly, in 15 years Vietnam has changed from being a net importer of rice to being the world's second largest exporter, but in terms of a command structure its culture is perhaps very different from Africa's.

The annual report contains little on macro-agricultural policy. Even the lengthy and very good Oxfam report on rigged rules and double standards contains nothing on agricultural policy, or on how the people will be fed and exports created.

It is argued that if one removes the European tariffs, everything will be all right, but it will not. On our visits abroad, we have examined whether there is a connection between tariffs and what can be grown. The Chairman of the International Development Committee mentioned the tomato surplus in Ghana. He will agree, however, that even if the tariffs had been right, no one in Ghana could have argued in a systematic and business-like way that that surplus was connected with any form of export market.

Much work needs to be done on agriculture. It has been neglected, and we should examine it much more fully.

5.49 pm

Mr. Robert Syms (Poole)

I have followed the hon. Member for Clydebank and Milngavie (Tony Worthington) on a number of occasions, and I always end up agreeing with him on most topics. A while back, with the Westminster Foundation for Democracy, we spent a week going around Nigeria before the civilians took over. We were trying to impart some spirit of democracy and integrity, but I got the impression that politics in Africa more closely resembled piracy. We have to keep trying, but sometimes the feeling is that one is banging one's head against a brick wall. We can only do our best, but the debate has shown that the difficulties are very substantial.

One in five people in the world lives in abject poverty, and 1.2 billion people live on less than a dollar a day. We are part of a global community, so for us to take an interest in the rest of the world, and in improving standards, is a matter not only of morality but of self-interest.

We take for granted such things as clean running water—but if we could achieve no more than the provision of clean water in the third world and the developing world, we would have taken a great step forward.

Another matter to emerge from the debate is the need for sensible contraception. This may be slightly more controversial as a subject, but sensible contraception—especially the provision of condoms—in the developing world would be helpful, given the population growth. Indeed, the AIDS problem would have been diminished had we managed to put as much effort into convincing people in Africa of the benefits of condoms as we have into dealing with the aftermath of unsafe sex.

Today's debate is on a worthy subject, and it is being held on the day when the annual report from the Department for International Development and a report from the Select Committee on International Development are published. The House is full of experts on international development, all of whom want to debate these very important issues.

The hon. Member for Clydebank and Milngavie was right to focus on trade. I believe that it is probably more important to get the world economic cake growing, and to enable countries in the third world to take advantage of an expanding trading environment, than it is to pursue many of the aid programmes that have been introduced.

As has been noted, Africa produces many primary products. The next stage for the countries in Africa is to process those products themselves. The House has heard this afternoon about the barriers that have been erected against Ghanaian chocolate, so one wonders how much chance those African countries have of breaking into the trade cycle.

All of us shop in supermarkets such as Tesco and Sainsbury's, and I am always amazed by how many products from all corners of the globe—such as wine from New Zealand or Chile, and apples or other goods from other places—are available. However, until we get African goods into the supermarkets so that salaried people can return value to the producing countries, we will not be able to raise the basic standards in those countries. The World Trade Organisation and the general agreement on tariffs and trade are therefore extremely important.

Over the past 20 years there has been a trend away from supplying aid through Governments to supplying it through NGOs. Also, big aid packages have given way to much smaller packages. Corruption is endemic in parts of the globe, so it is sometimes better to bypass the governmental structures and deal with people in villages and local communities.

Clare Short

The hon. Gentleman makes an important point. Many failed states in Africa, such as Nigeria, have wrecked Government systems. If we do not help to rebuild the systems in those countries, we will never get their economies to function properly, and we will not be able to provide health care for everyone. We need to help countries with crumbled public institutions to build decent, modern state systems, so that they can have decent economies and take advantage of trading opportunities.

Mr. Syms

The Secretary of State makes a good point. We certainly have to do our best to raise standards in those countries.

The commitment to providing primary school education for all is important, and we must also ensure that girls as well as boys benefit. That would at least allow the intellectual capital of the countries involved to develop.

A lot of good things are happening, and there are many initiatives, but we must ensure that they are followed through, and that we measure the progress being made. As has been noted in the debate, Britain is pretty good at measuring or tracking what is going on, whereas the EU is not quite so good.

I still find it difficult to criticise the EU for giving money to Poland or Hungary. At the beginning of the debate the Secretary of State referred to the straits of Gibraltar. As Spain and North Africa are very close, with only 20 miles between them, we have to take an interest. The Oder river is on the other side of Europe and, given the transition and the shock of the change from a communist to a free-market system in Poland, the Czech Republic and Hungary, it is inevitable that the EU will take an interest. It is in our interest to do so. If the transformation in eastern Europe goes well, Europe will become more prosperous, with bigger markets and more citizens. Providing that we get the politics right, Africa will have the opportunity to buy into that.

Given the relative position of South Korea and Ghana 40 years ago, it is interesting to note what South Korea has achieved since then. The hon. Member for Clydebank and Milngavie referred to Vietnam, and I wonder whether the Asians might be the best people to impart what they know to Africa rather than us in the west. There seems to be a certain ethos, a way of doing things, in Asia that can take countries from poverty and drive them, in the Confucian tradition, towards a degree of success, as China has succeeded in doing.

Tony Baldry

Does my hon. Friend agree that we do not know very much about why some states succeed and others fail? Perhaps we should do more work on finding out why some succeed so well.

Mr. Syms

My hon. Friend makes a good point. Comparative case studies would be useful. Some states in Asia have managed to succeed and go from poverty to relative wealth within a generation, without necessarily having civil wars. They have not all been democracies—indeed, Asia contains countries with many types of government.

The hon. Member for Putney (Mr. Colman) made a good point about failed states, particularly those with debt problems. Argentina's debt is causing real stress there. The Economist has made the point that there is no bankruptcy or receivership pathway for countries as there is for individual businesses. The international community must think more about how countries can overcome their problems. When debts overwhelm countries, even quite prosperous or potentially prosperous ones such as Argentina, it can be a dislocating process.

I should like to pay tribute to the work of the British Council. Information is very important. When I was in Nigeria and went to the British Council in Kano, we saw people there devouring British newspapers, even though they were sometimes months old. I am not sure what Nigerians would make of Sven-Goran Eriksson or the goings-on in this country. Nevertheless, there is an appetite for the information that newspapers and books can provide that cannot necessarily be had elsewhere in Nigeria.

The internet also has a role in disseminating information to Africa. To give an example, a firm in my constituency called Cotton Net Ltd., whose managing director is Bruce Evans, wanted to have an internet trading site. In 1999, The Daily Telegraph advertised what it described as an e-dream competition. The company entered, along with 1,000 other entries, and went through various processes. C14 Net, a company in the United States quoted on NASDAQ, was involved in the competition. Cotton Net won the competition and received a letter of intent saying that £1 million would be invested in the company, but then the dotcom crash happened and no money arrived.

Cotton Net had the very good idea of trading the cotton produced by many small farmers in eastern Europe. It has taken some trade, which it can do at a lower commission than many wholesalers. However, the company is struggling, so if anyone has any bright ideas to enable Cotton Net in Poole to trade in cotton, Bruce Evans would appreciate it. Getting the products to the markets is a real problem in many parts of Africa.

We are making progress, although it is sometimes painfully slow. We must get the negotiations on trade right so that we all become richer. We must ensure that aid is properly scrutinised and produces the right outcome. We all know that we must do much more about debt.

We live in a big wide world, and we need the consent of everyone in the world for things to go well. We have heard much about rogue states and terrorism, and we know that aircraft can travel to this country in only a few hours. It is important that our fellow human beings have a decent standard of living and proper government. We are making progress and I hope that it will continue. I hope that more people will invest in Africa—but there are problems when we hear about nothing but famines, wars, coups and looting. However, we must travel hopefully and I am sure that one day, when we debate this subject we shall find that we have made much more progress.

6 pm

Mr. Hilton Dawson (Lancaster and Wyre)

I shall be brief—partly because I have almost lost my voice, so I may have to abandon my speech after a while. This has been a superb debate on our most vital policy area and our most successful Department. I am delighted to have the opportunity to take part in it.

There has been some discussion of the relationship between international issues and Members' constituency interests, and of how we can balance the two in our casework. My response is that they are wholly interlinked. For example, I visited Sudan a few weeks ago, not only because I was interested in the country but because Sudanese people live in my constituency. They visit me and ask, "What are you doing about the situation in Sudan?" Visiting Sudan and taking an interest in international development are part of my constituency casework—we should all acknowledge that connection.

I nipped out for a cup of tea earlier and unfortunately ended up reading a page of the Evening Standard about a couple of racists who are standing in the elections next week. After that, it was good to come back to the Chamber and hear Members on both sides of the House reaffirming their common humanity and their common interest in such a profoundly important subject.

The aid budget needs to be increased dramatically. There has been enormous progress from the 0.26 per cent. inherited by the Government in 1997 to the present 0.39 per cent. We need to go further, however. That would be a most powerful affirmation both of the central importance to the Government of the aid policy and of the success of the Department for International Development.

Massive challenges face us across the world. Many of them are set out in the honest and straightforward report issued by the Department. However, people should not despair about the problems. Indeed, no one in the House or in this country has the right to feel despair, given the circumstances that face people in other parts of the world. We can draw great comfort from the HIPC initiative, from our constituents' support for debt relief, and from the way in which countries such as Uganda and Mozambique have magnificently used the opportunities afforded them to invest in health and primary education to develop their societies.

We can draw great inspiration from a Prime Minister who is committed to African development and to dealing with the problems of Africa. We can also take great hope from NEPAD—itself an African initiative. We can draw great optimism from the Secretary of State's comments and the statements in the departmental report about the possibilities for peace over a great swathe of the continent—from the Atlantic to the Red sea, from Angola to the Democratic Republic of the Congo, and from the Great Lakes to Sudan.

We have not spent enough time talking about the role of non-governmental organisations, which play a magnificent role in promoting policy and can be an important thorn in the side of Governments when they carry out policies on the ground. Many of us have seen them operating in the most difficult and dangerous circumstances in the most impoverished places, working to feed children and to develop health and food projects. We owe them a great deal.

My first trip to Africa was to Burundi with UNICEF in 1998. Our host was a man called Luis Zuniga, who was head of UNICEF there. A couple of years later he was murdered doing his job—visiting an internally displaced persons camp to assess the state of the children there and try to protect them.

I have also visited Angola, a country that has enormous potential and tremendous opportunities now that its war is over, although corruption remains a huge problem. Angola is potentially very wealthy, with huge oil and diamond reserves, but in its IDP camps we saw squalor worse than I want to see again. Fifty-six people were living in a tent of the size that hon. Members might take on holiday for a fortnight in France. There was little running water and no electricity, and some children were starving or had had limbs blown off by land mines. Then, the Angolan Government used the war as an excuse; now they no longer have that excuse. They have an enormous responsibility, with the support of the international community, to get to grips with the country's massive problems and huge opportunities.

In Angola we met extraordinary young people from the Angolan youth parliament, who expressed their distress at being able to see the opportunities that were available to young people in the rest of the world, and their disgust at living in a situation that UNICEF has described as possibly the worst anywhere in the world for children growing up. The example of those young people offers real hope for the people of Angola.

A few weeks ago we visited Sudan, which is the largest country in Africa and has enormous mineral wealth. The despair of Sudan has already been well described, but everyone we met showed an urge towards and a desire for peace. We met intelligent rational people for whom peace is the intelligent rational choice.

It was clear that if the Sudanese people had peace, the country could develop tremendously on the basis of its mineral wealth. It could become an important player in NEPAD, and an important bridge between Africa and the middle east, the Muslim world and the Christian world, and the Arab world and the African world. Its potential is enormous, but hard choices will have to be made to secure peace. The new unit set up jointly by the Department for International Development and the Foreign and Commonwealth Office under Alan Goulty has an opportunity to play an important role in peace negotiations in a country where we saw that the influence and interest of the United Kingdom was broadly welcomed.

Both sides will have to face up to the fact that at some point, which they must define, there will have to be an act of self-determination. At the very least, there will have to be a referendum, in which everyone participates, on the future of the country. There will be plenty of time to work out whether the country's future lies in separation or devolution. Sudan must also work out how to tackle all the issues of development, including economic development, and how to fulfil the needs of a proper civil society, such as basic structures for health, security and education. Both sides need to face up to the need for a referendum, and our Government, along with the surrounding countries, will have to help them to do so.

I am delighted by the Secretary of State's remarks about the importance of primary education in humanitarian development, and of assisting children who have been displaced.

Before I conclude, I want to make one constituency point. We have a small town, a very white town, in the middle of a rural area, which under the influence of the local Oxfam group declared itself the world's first "fair trade" town. Garstang is now twinned with New Koforidua in Ghana and it has built up good links with that country. One of the most inspirational experiences that I have had as an MP was organising a local produce breakfast with the previous Under-Secretary of State for International Development, who is now the Minister of State, Scotland Office. It was attended by local schoolchildren, farmers, business people and dignitaries, who all enjoyed eating bacon and eggs and talking about the relative position of farmers in Garstang and Ghana. If we can keep that sort of dialogue going, there is real hope for the future.

6.12 pm

John Barrett (Edinburgh, West)

Much of what had to be said today has already been said, but it has struck a chord on all sides of the House. I congratulate all the previous speakers on having made informative and interesting contributions.

I have been impressed by the genuine concern of many hon. Members here today, and as a new member of the International Development Committee, I have already heard evidence given by the UNHCR, Action Aid and the Secretary of State, among others. Much credit must go to the Secretary of State, whose forthright approach on these issues leaves nobody in any doubt that she feels passionately about her work and the work of her Department. The annual report was published too close to this debate to allow me thoroughly to read it all, but contributions from other speakers showed that they found time for a more detailed analysis. In fact, I saw my hon. Friend the Member for Richmond Park (Dr. Tonge) reading it during last night's parliamentary party meeting.

One issue on which I should like to focus is the untying of aid, which is a welcome move. I entirely agree that DFID should continue to promote that among other Governments. The UK Government's decision is good because it is taking the lead and pushing other countries in the same direction. Tying up aid can skew development projects away from poverty-focused projects and lead to the provision of the wrong type of service and advice.

I heard what my hon. Friend said about debt relief. It was interesting to read a recent note from Jubilee Plus which mentions that the US has built up a massive external debt of $2.2 trillion, and while it pays $20 billion per annum to service that debt, poor countries are crippled by over $300 billion of debt service repayments on a debt that is almost the same as the US Government's national debt.

One of the reasons why I first got involved in politics was that I realised that the problems facing us in this country, important though they are, are often nothing compared with the plight of millions around the world, many of whom are starving. Some years ago, I was involved in supervising the delivery of aid to eastern Europe on behalf of a Scottish charity that had raised money, medical supplies and presents for children who were suffering from the effects of the Chernobyl nuclear reactor explosion. That was my first experience of seeing that inefficiency and corruption can go hand in hand, and I hope that the Secretary of State and her Department will continue to pursue and root out corruption whenever there is evidence of it among recipients, to make sure that those most in need receive what is due to them. The millennium development goals are important, and, again, all hon. Members who have contributed to the debate have subscribed to the contents of the DFID report.

There is always a fine balancing act—on the one hand, respecting a decision of a democratically elected Government to set their own priorities, while, on the other, ensuring that aid goes to the most needy. The Tanzania air traffic control system is a perfect example of that, and we hope that this Department will pursue a wise course of action in that regard.

One of the previous speakers mentioned Sudanese residents bringing the issue of Sudan to his attention. I think that I mentioned in a debate on Sudan in Westminster Hall that no constituent of mine has ever raised that issue with me; indeed, it is relatively rare that people raise third-world debt with me. It is not because they do not care. I believe that it is determined by where the news teams are. We saw pictures of the famine in Ethiopia, and that had an impact around the world. Members of the House must take responsibility to press the media to take an interest, and the Department must ensure that there are no forgotten areas of this world.

Some of the most difficult areas to deal with are those where conflict exists, whether it is in Sudan, Palestine or Afghanistan. In Palestine, we have witnessed the destruction of projects funded by EU aid. In Afghanistan, rebuilding of the country must be a priority. As the Secretary of State said, without an infrastructure, there will be no way for aid to get through, and people will continue to starve. This morning, we heard again that 3 million to 4 million people are at risk from famine in Malawi—a country where development aid was cut recently because of corruption—and emergency aid will now be required. My hon. Friend the Member for Richmond Park has raised this issue with the Secretary of State. Once again, I am encouraged to be brief, as many items have already been dealt with.

Finally, I want to refer to the Budget Red Book. I noticed that about two pages were dedicated to international poverty reduction; interestingly, that constitutes approximately 0.7 per cent. of the document. Unfortunately, we are not making great progress towards the 0.7 per cent. target. At the current rate of progress, my researcher, who is 22, will be delighted to know that he will be able to celebrate the 0.7 per cent. target being reached just in time for his 100th birthday. Surely we must do better.

6.18 pm

Norman Lamb (North Norfolk)

I want to join in the tributes to the leadership shown by the Secretary of State in raising the profile of international development, and, critically, in increasing public acceptance of the case for augmenting spending in this area. In the past, there has been much misuse of development assistance and misdirection of money—it has been used for the wrong purposes and has got into the wrong hands. As a result, public acceptance has fallen significantly over the years. The Secretary of State's role in re-establishing and rebuilding the importance of this area of spending in the public's eyes has been enormously valuable.

This afternoon's debate has not focused much on the passing into law of the International Development Act 2002. In some ways, that is surprising, because the establishment of the central principle of poverty alleviation and sustainable development is of great importance. Apart from anything else, it directs attention to other areas of Government in which that same focus may not yet exist. The Government's international policy on the developing world still lacks coherence. We have established that development assistance must be devoted to the alleviation of poverty and to sustainable development, but that principle needs to apply across Government and Government policy.

Let me highlight one or two examples of how the principle has clearly not been in place in the past year and on which further work needs to be done. Many hon. Members made the case about European spending on development assistance. I will not cite all the statistics that show how out of focus European spending is; suffice it to say that it is not being spent sufficiently on the countries in most need, and that problem is getting worse. There is a reform process, but inadequate and insufficient progress is being made to ensure that the money is spent in the most deserving countries. Unless the pace of reform improves substantially, we will have to ask ourselves whether it is better for us to keep that money and spend it in accordance with the Act, so applying the core principle of the alleviation of poverty. At the moment, the way in which European money is spent on development assistance goes against the Act's core principle.

Several hon. Members mentioned the Commonwealth Development Corporation. In the recent Adjournment debate on that subject, the Minister rejected the contention that there was cause for concern about the move towards partial privatisation. Let me repeat the strong assertion that there is self-evidently a possible conflict between seeking the highest rate of return on an investment and having poverty reduction as the core principle. Other hon. Members said that CDC money, used as a pump primer in areas where commercial money will not go, plays a crucial role in developing countries. It is enormously regrettable if we are to lose that, as appears to be the case.

Like the hon. Member for Meriden (Mrs. Spelman), I have just returned from the trip to India organised and paid for by Oxfam. I was told that the CDC man in India is busily organising investment in information technology. IT is concentrated in one or two specific high-growth areas in India. It has little impact on the rest of the country. The point was made most forcibly to me that that is not helping to alleviate poverty and that the money needs to go to parts of the country where it is much more needed.

On arms sales, I agree with the Secretary of State that developing countries need internal security. Of course they need armed forces so that they can defend themselves. Is it right, however, that arms exports to Africa from this country were worth £52 million in 1999, £125 million in 2000 and are anticipated to be worth £200 million next year, according to the Campaign Against the Arms Trade? They are paid for, inevitably, by increasing debt in countries where we often have to write off that very debt. In addition, there were reports this week of sales of military aircraft to India that are capable of conversion to carry nuclear bombs. Given the fragility of relations between India and Pakistan, is that wise? Is it compatible with the thrust of the Department's work?

On Tanzania, the point has been made many times that selling an air traffic control system for military use to one of the poorest countries in the world goes against the principles of the Act. It is extraordinary that that export licence was granted. There should be a full inquiry into how that happened.

There is also the United Kingdom's involvement in the manufacture of and trade in cluster bombs, and their use. We must question whether such involvement is contrary to the core principles that are set out in the International Development Act 2002. There are 14,000 unexploded bomblets scattered round Afghanistan, and the impact on civilians following conflict is massive. The situation prevents them from returning to agriculture. It prevents children from playing as they would normally do in peaceful times. If we are to have the same coherent focus on developing countries, there must be international agreement on the use of cluster bombs and on the obligations of countries that use them following conflict to clear up the mess that they create.

In terms of creating coherence and consistency in policy, there is the issue of trade, which is highlighted in chapter 2 of the report and mentioned by many Members this afternoon. I support the work of the Department in working with the Department of Trade and Industry to increase opportunities for developing countries to trade. It is clear that the Doha agreement is a step in the right direction.

I was struck by the fact that India makes up 20 per cent. of the world's population and yet has a share of only 1 per cent. of the world's trade. There must be more equitable trading rules. The EU is one of the worst offenders, as the Oxfam report has demonstrated.

I was struck in India also by the massive challenge for the country itself in breaking down internal barriers to create a single market. There are incredible queues of lorries between states within the country, each charging its own tariffs on entry. India needs to create a common tax system throughout the country. There is a massive need for labour law reform. It is essential also to tackle the endemic corruption that riddles the country.

Without those internal changes, there will not be the necessary internal investment. That will prevent India from participating in international trade. There is an obligation on both the developed world and the developing world to take a great deal of action to ensure that international trade increases.

I turn to the effectiveness of spending within the budget of the Department for International Development. I welcome the Department's acceptance of a clear strong link between good governance, proper management of public finances and the achievement of development targets. Chapter 3 of the report refers to the recognition of the huge scope for improvement in public financial management in the 25 heavily indebted poor countries. That improvement still needs to be made. I welcome the Department's recognition of the increasing link between the giving of assistance and achieving improvements in governance and financial management. The New Partnership for Africa's Development initiative, where Africa is taking responsibility itself for improving governance and obtaining assistance in return for those improvements, is a case in point.

In India, I saw the Department working in four states, choosing the states where there is most evidence of a move towards good governance, and where reformers are in charge and making a real difference. It was good to see the Department working with reformers to ensure that our money went to good effect.

Close scrutiny of how the Department's money is being spent is vital. Since my return from India, I have received an e-mail from India referring to the fact that the Department's HIV/AIDS work in conjunction with state governance in two states, Kerala and Andhra Pradesh, is effectively subcontracted to a private company, Dalai Engineers Ltd., a name that hardly suggests that the company has massive experience in HIV/AIDS work. That may be working well, but I should appreciate it if the Minister could investigate the matter and let me know whether the money is being effectively used.

I warmly welcome the increasing budget for aid, although I am disappointed that the Government have not been more ambitious. The extra money creates new challenges to ensure that it is spent effectively by the Department. It has been suggested to me that there is a shortage of ideas for good quality projects, and there is a danger of a poor return on money if it is simply pumped into the system. More money means more pressure on staff to ensure effective use, so transparent evaluation of the work of the Department is essential.

DFID has an internal evaluation unit, and the Department's website includes a section on evaluation, yet reports on evaluation go up only to 1997. There is nothing thereafter. Are those evaluation reports continuing? It is essential that they are available on the internet for the public to see.

I conclude by acknowledging that the Department has made massive progress in the past year. However, we must all realise that there is an enormous burden on both the developing world and the developed world to continue the process of reform and to ensure that all the money is spent on the alleviation of poverty.

6.31 pm

Mr. Andrew Rosindell (Romford)

I shall be brief, as I realise that we are coming to the end of the debate.

I commend the Department and particularly the Secretary of State, who is no longer present, for the work that they are doing. However, much is not being done in the most efficient and effective way. The Government's duty is to ensure that every penny that we spend on international development is spent wisely, sensibly and to the best effect.

From what I have read in the reports issued this week, I believe that the money that we are giving to the European Union is not being spent in the wisest possible way. The time has come to change that policy. We should consider restoring to ourselves control over the money that we spend on international development. We have a duty to help those in the poorer countries as much as we can, but that is not done by handing the money over to Brussels to spend in a way that is not as efficient as the way in which we would spend it.

I am wearing a poppy and rosemary, not because it is Remembrance day in the United Kingdom, but because today is ANZAC day. I was privileged to attend a service at Westminster abbey this morning to commemorate ANZAC day. It brought home to me the close relationship that the United Kingdom has with the countries of the Commonwealth, particularly Australia and New Zealand. I know that those two countries have proud records on international development aid.

I strongly urge the Government to focus on co-operating with Australia, New Zealand, Canada and, as other hon. Members said earlier, the United States of America—countries with which we have a common heritage and a common understanding—to promote international development in countries where good governance exists. It is throwing money down the drain to give it to countries where it will be squandered and used least effectively for the very people whom we most wish to help. I concur with my hon. Friend the Member for Meriden (Mrs. Spelman), who is on record as saying that European Union aid is "failing the poor". That is not the only area where the EU is failing.

We have a duty and a moral responsibility to restore the control of international development funds to our own Government, and to spend that money in a way that will help the poorest in the world. That means controlling the funds ourselves and co-operating with our friends in the Commonwealth, but not handing that power over to the European Union.

6.34 pm

Dr. Julian Lewis (New Forest, East)

As this is my first and, quite possibly, only outing at the Dispatch Box, it is a great pleasure to be called on to summarise a debate on a subject that enjoys such general agreement on both sides of the House. The only significant clash has been, once again, over the former Commonwealth Development Corporation, and I hope to have time to return to that a little later.

I should like to think that some of the remarks from those on the Opposition Benches made during the Westminster Hall debate on the CDC on 10 April encouraged the Government to make more time available to debate international development, and all hon. Members present today have benefited from this debate.

The hon. Member for Leeds, West (Mr. Battle) drew on his detailed knowledge of extremely primitive conditions in African villages. He made an excellent analogy between a snooker game and the way in which selfish protectionism can cost jobs at home on the rebound from blocking jobs abroad in poor countries.

The hon. Member for Richmond Park (Dr. Tonge), who speaks for the Liberal Democrats, was in reflective mood. She posed some serious questions about whether giving aid is merely to fight a losing battle, but resolved such doubts by an overriding sense of moral obligation. Her fears that we are sometimes told that more is being done than really is being done, because debt repayments are left out of the equation, struck a chord on both sides of the House—if not her reference to "bounders" in the Foreign and Commonwealth Office and Department of Trade and Industry.

The hon. Member for Putney (Mr. Colman) stressed fair trade, the provision of basic services via foreign investment and the need to reintegrate ex-militias into civil society in all too many damaged poor states.

My hon. Friend the Member for Banbury (Tony Baldry), who is Chairman of the Select Committee on International Development, applied his encyclopaedic knowledge to many aspects of international development, not least the dumping of excess EU produce on poor countries as a result of the unreformed CAP, the scourge of AIDS, the long-term political goal of democratisation and the need to keep sight of what all the policies, pledges and statistics really mean in individual human terms.

AIDS was the main topic taken up by the hon. Member for Ealing, Southall (Mr. Khabra). He explained, with great seriousness, that arguments about patents for anti-AIDS drugs largely missed the point that it would often still be too expensive to distribute them, even if they were given free to poor countries, and that interrupted courses of treatment help to cause the virus to mutate and become much more resistant.

My hon. Friend the Member for Blaby (Mr. Robathan) painted a depressing portrait of squalor, disease, corruption and intimidation in major unsettled African states, and referred to the prospect of terrorist training camps in Sudan, the timebomb ticking in Nigeria and the decline in Zimbabwe caused primarily by the absence of anything approaching democracy and good governance. It was a powerful indictment of some of the problems that are largely beyond the reach of mere financial aid.

The hon. Member for City of York (Hugh Bayley)—another member of the Select Committee—showed his considerable expertise on the way in which trade trends adversely affect the welfare of the least developed countries. He made a plea for the liberalisation of economies on both sides of the development divide and mentioned the support for political extremism in France. He may be interested to know that Alois Brunner, the man who organised the war-time deportation of the French Jews to Auschwitz—a terrible event, to which the hon. Gentleman referred—was sheltered for many years by the Syrian regime and may still be alive in Damascus even today. That is a salutary reminder of the morality and values of some Governments with whom we still have to deal.

The theme of trade liberalisation was taken up by the hon. Member for Ceredigion (Mr. Thomas), but I trust that he will forgive me for saying that my abiding memory of his speech will be what he told us about the role of Welsh enterprise and Welsh sheep in producing anti-snakebite serum for the developing world.

The hon. Member for Clydebank and Milngavie (Tony Worthington) stressed that sub-Saharan Africa is falling seriously behind and set out a worrying list of problems with his characteristic blend of thoughtfulness and thoroughness. As in Westminster Hall on 10 April, he expressed concern about the new direction of the CDC.

My hon. Friend the Member for Poole (Mr. Syms) pointed out that what we used to call the "second world" countries of eastern Europe will inevitably rank high in the priorities of EU states. He highlighted the problems of ordinary business men in reaching potential markets in Africa.

The hon. Member for Lancaster and Wyre (Mr. Dawson) rightly praised the calibre of today's debate and spoke movingly about the privations that he witnessed in Angola and the need for an end to strife in the Sudan.

My hon. Friend the Member for Romford (Mr. Rosindell), who has shown a consistent interest in international development, brought his usual robust approach to the subject of international development and the European Union in general. The hon. Members for Edinburgh, West (John Barrett) and for North Norfolk (Norman Lamb) made valuable contributions, although they were inevitably foreshortened by pressure of time. One of them previously intervened to ask whether the Opposition had ever committed themselves to the UN target of 0.7 per cent. of GNP to be devoted to aid and had ever given a timetable for achieving that. The answer is yes to the first and no to the second question. Neither the Government nor the Opposition have ever given a time frame for that great task to which we are all committed. The Liberal Democrats would be foolish to try to do so in advance of taking power, which I hope will be long in coming.

My hon. Friend the Member for Meriden (Mrs. Spelman), the shadow Secretary of State, covered six topics of primary concern. At the outset, she pressed powerfully the question of the CDC and brought out the problem, which was first aired when the Bill was going through in 1999, about the potential conflict between the CDC and DFID as providers of aid to underdeveloped countries. That conflict was denied at the time but, unfortunately, seems to exist now.

My hon. Friend drew attention to aid via the EU and the way in which distortion is taking place: even as the Government creditably put emphasis on providing aid to the right countries, the EU is falling massively behind and, indeed, reversing the priorities. In the report published yesterday, the Government proudly point out that their main donations are to sub-Saharan Africa, south Asia, and east Asia and the Pacific. The European Community, however, has been developing a strategy that has shown diminishing support for those priority areas and an ever-higher proportion of support going to what might be called the near abroad—the countries in the middle range of development, not the poorest countries, which should be our main concern.

My hon. Friend also touched on the BAE deal in Tanzania, her experiences in India, the problems of fair trade and, in particular, the question of debt. She is greatly concerned, as are others, that aid that is given with one hand should not be negated by the removal of a country's wealth in debt repayments by the other.

The Secretary of State gave what can be described only as a sombre review of life on a dollar a day, or at most two dollars a day. She said that terrible poverty in an age of excellent communications is a recipe for conflict, bitterness and hatred. She referred to the danger of Africa becoming a failed continent and pointed out that it was on the basis of failed states that terrorist regimes take root and prosper. That put me in mind of what was said in the first report from the Select Committee this Session about the humanitarian crisis in Afghanistan. The report states: We hope the Government's response to this report will address the issue of failing states, how they are monitored and what level of preparedness the international system can maintain to respond to problems in these failing states. The Government's response has merely been to acknowledge the importance of that and to say: DFID is working in the OECD Development Assistance Committee study to identify best practice in how to promote change and reduce poverty in failed states and how to ensure that the international community remains sufficiently engaged with such states. When the Minister replies I hope that he will expand on that and explain a little more precisely what the Government are doing to head off the potential of failed states leading to terrorist development.

Finally, the CDC issue was examined in great depth in the Westminster Hall debate on 10 April. It has been pointed out that, apart from the Minister himself, everyone who spoke in that debate was unhappy, dissatisfied and seriously alarmed about the CDC's change in direction. In his closing remarks in that debate, the Minister said: The CDC plays an important role and it is right that there should be scrutiny, but we must crack the fundamental problem—private capital does not want to invest in the poorest countries."—[Official Report, Westminster Hall, 10 April 2002; Vol. 382, c. 21WH.] If that really is the Minister's view, he must admit that the Government have taken a wrong turning with the CDC. The sooner they revisit mistaken action in connection with that important organisation, the sooner we will achieve unanimity, not on almost all the issues that have been debated today, but on every one of them.

6.45 pm

The Parliamentary Under-Secretary of State for International Development (Hilary Benn)

I welcome the hon. Member for New Forest, East (Dr. Lewis) to the Dispatch Box. I understand that he is taking a lead from the Government, who believe that Whips should be able to speak from the Front Bench, a view that has been subject to criticism. However, it is good to see at last bipartisan support for an erosion of the principle for which I might coin the phrase "the silence of the Whips".

The hon. Gentleman provoked me to make just one party political point, but I promise to make no more during my speech. He referred to the Conservatives' commitment to the 0.7 per cent. target; when the Conservative Government were elected in 1979, they inherited a figure of 0.55 per cent, but when they left office in 1997, they bequeathed to us a figure of 0.26 per cent. We must do better.

Dr. Lewis

The Minister should bear it in mind that figures given as percentages often have a lot do with the state of the economy rather than the amounts donated—[Interruption.]

Hilary Benn

I shall try again, but the House has indicated with its response that it is not persuaded by that argument.

Mr. Robathan

rose—

Hilary Benn

Will the hon. Gentleman bear with me a moment?

We have had another excellent debate. Like almost every contributor, I, too, hope that it can become an annual event. If we have done nothing else today, we have at least honoured the prayer of the Speaker's Chaplain, who every day in the Chamber asks us all to keep in mind our responsibility to seek to improve the condition of all mankind. Never in human history has it been more important that we should do so. I do not risk contradiction if I say that hon. Members on both sides of the House have all contributed something of value to our deliberations.

My hon. Friend the Member for Lancaster and Wyre (Mr. Dawson) talked about the fair trade breakfast to which he invited my predecessor. If he made me an offer now, my stomach would command me to accept.

Clare Short

It is bacon and eggs.

Hilary Benn

As a vegetarian, I would not eat the bacon, but I would have the egg.

The hon. Member for Ceredigion (Mr. Thomas) described the Government as the usual suspects, which is rather unfair. However, there are more of the usual suspects attending and taking part in international development debates because more Members recognise the importance of the subject. The hon. Gentleman kindly mentioned the international Commission on Intellectual Property Rights set up by my right hon. Friend the Secretary of State. I also draw his attention to the committee chaired by my right hon. Friend which works with pharmaceutical companies and tries to address the question of access to medicines. I for one would certainly welcome a debate on GATS; crying wolf on GATS—I am referring more generally to people's comments—does not assist informed discussion.

A number of Members referred to the CDC. I do not propose to rehearse our recent debate in Westminster Hall, but I shall make a plea for some perspective on the CDC, which still holds 80 per cent. of its agricultural portfolio. In 1999 to 2000, it made £100 million worth of new investments in agribusiness. To listen to some Members this evening, one would think that it had stopped making such investments altogether. It remains a unique investment institution. As I said in our Westminster Hall debate, I defy any Member to name another worldwide investment institution 70 per cent. of whose new investments have to benefit poorer countries, and 50 per cent. of whose investments are made in sub-Saharan Africa and Asia. The CDC fulfilled, indeed exceeded, both those targets in the year that has just ended.

On agriculture more generally, let us not forget that world food production has doubled in the past 40 years. Rural livelihoods remain extremely important to DFID. The CDC is not the sum total of the work that we do to support agriculture. The work of our rural livelihoods department is central. In terms of population growth, hon. Members will know that the biggest growth in the next generation in developing countries will be in the number of people living in towns and cities. Almost all the population growth will occur in that respect.

On the world summit for sustainable development, the hon. Member for Poole (Mr. Syms) referred to water and sanitation. What we need now in relation to the world summit is practical outcomes. After the success of Doha and financing for development, we need to get beyond some of the jargon and deal with the practicalities. Issues on which we could make practical progress include illegal logging, in terms of which the link between forestry and livelihood is important, and improved water and sanitation, which is important not least because installing a water pump in a village is a very good way of enabling girls to go to school as it means that they will not have to spend a large part of the day fetching and carrying water—a burden that falls especially to girls. I was astonished to discover that in the past 10 years, more children have died of diarrhoeal diseases in the world than all the people who have died in conflicts worldwide since the end of the second world war. That statistic, if no other, shows the importance of making progress. It probably explains why Mahatma Gandhi said: Sanitation is more important than independence.

The hon. Member for Blaby (Mr. Robathan) took us on a tour of Africa, which I greatly enjoyed. He asked some very sharp and pertinent questions about governance. I shall respond to his further letter about Nigeria. The hon. Member for Edinburgh, West (John Barrett) described the personal motivation that had brought him into politics—a motivation that is central to what has brought so many hon. Members into the debate.

The hon. Member for Meriden (Mrs. Spelman) asked a very important question about India, in relation to the visit that she has just made. She asked how we spread the reform that we can see in some states, and which DFID is supporting, to all the states. My hon. Friend the Member for Ealing, Southall (Mr. Khabra) made the very important point that some countries need to do a lot more to tackle HIV/AIDS. The hon. Member for Romford (Mr. Rosindell) spoke with passion about EU aid. I welcome the Select Committee report—another excellent report that is keeping the pressure up. We all share the view that we need to do better.

I can tell my right hon. Friend the Secretary of State that in her opening contribution, as ever, she provided us with vision not only in the sense of inspiration, but in terms of urging us all the time to look ahead at the development challenge that is yet to come. If there is one quality in particular that I admire about her, it is her ability to make every opportunity in this House a chance to engage in a seminar about why international development matters and the steps that we need to take to enable progress to occur.

The hon. Member for Richmond Park (Dr. Tonge) rightly said that we must not be complacent. I do not think that there has been any complacency in this debate. One of the features of DFID is the presence in the dialogue between Ministers and civil servants of a constant questioning in which we ask, "Have we got this right? Do we need to do more? Do we need to reflect and change our policy?"

If we can make this debate an annual state of the world debate, we will have an opportunity to return to the arguments that have been advanced today and see who was right and what progress has been made. What strikes me most forcibly about all the contributions is the extent to which the theme of interdependence has glued them all together. What we now choose to call globalisation is in truth a process that has been going on for hundreds of years, although it has been gathering pace in the past century. It is, after all, nothing more than human beings' astonishing capacity to interact with the physical resources of the earth to create technologies that have transformed the existence of some of the people who live on the planet and which have the capacity to do the same for many others if we get this challenge right.

My hon. Friend the Member for Clydebank and Milngavie (Tony Worthington) made a plea, which I echo, for a more informed debate about globalisation. All the questions that it raises—its impact on the poor, its effect on people's sense of culture and identity, the pace of change and the feeling in some quarters that we can no longer influence events—lead to confusion in some areas. That is best exemplified in a banner that may be apocryphal, but was seen in a demonstration. Emblazoned on it were the following words: "Worldwide Coalition Against Globalisation." There is much to reflect on in those words. My hon. Friend and neighbour, the Member for Leeds, West (Mr. Battle), in his outstanding contribution, talked about a conversation at a snooker table. That exemplified perfectly the fact that these matters are not quite as simple as some people choose to present them on certain occasions.

The biggest danger we face is that cynicism, despair and hopelessness should overcome what we need to do. The most important thing is to reinforce our optimism, based on a sense of realism about the progress that we have been able to make, and this debate has provided us with the opportunity to do that. That is why the UN human development report published last summer was able to state that the impressive gains of the past 30 years demonstrate the possibility of eradicating poverty". That matters, but we need to redouble our efforts, for all the reasons to which hon. Members have referred. The question is—how?

Aid matters, because it makes a difference. It helps children to get into primary school, for example. The quantity of aid also matters, and the Government's record on that speaks for itself. The way in which aid is given matters, in terms of untying debt relief. I should say to my hon. Friend the Member for Putney (Mr. Colman) that Burkina Faso was the first HIPC country recently to receive additional relief to compensate for lower commodity prices, and representatives at the spring meetings agreed to review debt sustainability under HIPC at their next meeting in the autumn.

The quality of aid and of governance matter, not least because we have to show our electorate—when we are having the argument about aid—why it is worth putting these resources in. Also, we understand much better now that the governance and legal system of a country, the commitment of its Government to poverty reduction, the effectiveness of its civil service and its civil society, and the health of its democracy all have as great a contribution to make to creating the conditions in which poverty eradication can occur as all the aid that we are likely to give.

The local ownership of the process also matters. We cannot go in as the ex-colonial power and knock on the door, saying, "Hello, we've come to develop your country." There has to be a partnership. The question that the hon. Member for Meriden asked about how to match good donors with good recipients goes to the heart of the honest dialogue that we are trying to build in our relationship with the countries with which we work.

References have been made to trade and to economic development. It was the same process of economic development that enabled this country to move from where we were 300 years ago—with very poor life expectancy, lots of children unable to go to school, and people in very poor health—to where we are today, for all the arguments about the state of our public services. The countries that have not yet had that opportunity wish only to do what we have done, because they know what progress that development will be able to deliver.

My final comments relate to the point I made earlier about confidence, and the need to counter cynicism and despair. They relate, in essence, to the way in which our democracy works, and to what I said about the feeling that we lack influence. The reasons why we need to counter that cynicism and despair were put forward most forcefully by my hon. Friend the Member for City of York (Hugh Bayley) when he referred to the French election result, which is very much in our minds. We can never drop our guard against an ideology that seeks to deny our interdependence and to despise what makes us different. We reject that ideology because we have to embrace that difference. We have no choice, but we do so willingly because we recognise our common humanity.

This is an argument that we have to win in people's minds. I am reminded of the wonderful words of the UNESCO declaration: Since wars began in the minds of men, it is in the minds of men …that…peace must be constructed. That is the challenge. When people say to politicians that politics never make a difference, I say that that is not true. We can find no better illustration of that than the Government's achievements on international development. This is politics working, and there is no greater cause that politics can serve in the years to come than trying to rid the world of poverty.

It being Seven o'clock, the motion for the Adjournment of the House lapsed, without Question put.