Trade Justice for the Developing World

HC Deb 03 March 2004 vol 418 cc913-63

Mr. Speaker

Before I call the hon. Gentleman to move the motion, I inform the House that I have selected the amendment standing in the name of the Prime Minister.

1. 18 pm

Mr. John Bercow (Buckingham) (Con)

I beg to move, That this House shares the concern of the Trade Justice Movement about the plight of the poorest people in the world, and congratulates the Movement on bringing their conditions to the attention of the public; notes with concern the fact that more than one billion people live on less than one dollar a day, that life expectancy in many African countries is declining, that 28 million people in Africa have HIV/AIDS, and that the poorest countries' share of world trade has fallen sharply in the last two decades; recognises that the combination of trade distorting subsidies by rich countries and barriers to products from poor countries have gravely damaged the latter; believes that trade liberalisation and increased international trade offer the best hope of alleviating poverty in the developing world; regrets the breakdown of the WTO talks in Cancun; and urges the Government both to press for the talks to restart and to publish its proposals for the reform of agricultural subsidies and the reduction of trade barriers to give poor countries the fair deal on international trade that will allow them to compete and grow. It is a particular pleasure and privilege to move this motion in Fairtrade fortnight and, at least in part, in recognition of the invaluable contribution to development work and political debate that has been made by the Trade Justice Movement.

I begin by simultaneously pleasing and displeasing. I am not here this afternoon, in valuable Opposition time, on a crucial issue of national and international importance, to pick a fight with the Government; I have no desire to do that. Indeed, I would almost go so far—although perhaps not quite, Mr. Speaker—as to offer to do a deal with the Secretary of State. That would be to say to him that if he would accept what he knows to be true—that there is real merit in the Opposition motion—I would be prepared similarly to concede that there is real merit in the Government's amendment. My purpose this afternoon is not to cavil and not to play political ping-pong. It is to highlight an evil, to describe as best I can the incidence of that evil and to suggest how that evil might best be tackled by people in all political parties who share good will on this matter.

The subject that we are debating—I know this is often said, but it happens to be true in this case—is equal to, and probably almost greater than, any other in its importance for the future of our world. We are debating the plight of the poor, and the features and manifestations of the plight of the poor are palpable, sometimes endemic, always serious.

There are currently on our planet 1. 2 billion people who have to exist—I will not say that they live—on less than a dollar a day. There are 50 countries in this world that are poorer now than they were a decade ago. Every minute of the day one woman dies in pregnancy or in labour; in the process of trying to give birth, her life ends. There are 28 million people around the world suffering from HIV/AIDS. And, as the Secretary of State knows, the poorest countries in the world have suffered a cut of approximately half in their share of world trade in the last two decades. That is the scale and those are the dimensions of the crisis and—I use the word advisedly—the evil that we are this afternoon considering.

Chris Grayling (Epsom and Ewell) (Con)

My hon. Friend rightly mentioned HIV/AIDS. Is he aware that the threat goes far beyond the humanitarian issue? I have had feedback from people working on the ground in East Africa to the effect that the prevalence and growth of HIV/AIDS are being exploited by militants, particularly Islamic militants, to try to establish footholds in those countries. Therefore, not only do we have a humanitarian obligation, but it is in our self-interest to make sure that these issues are addressed properly.

Mr. Bercow

My hon. Friend makes a powerful point, and I agree with every word that he has just said.

We must not be simplistic about this. There is no one cause of poverty in the third world. The problems that the people of the developing countries endure are multifaceted and do not lend themselves to the administration of a simple cure. But upon one point I hope all of us in the Chamber can agree: we have an obligation to do nothing to exacerbate the plight of the poor, and, by contrast, to do everything we reasonably can to tackle and alleviate that plight.

Mr. Colin Challen (Morley and Rothwell)(Lab)

rose—

Tony Baldry (Banbury) (Con)

rose—

Mr. Bercow

I give way to my hon. Friend, the Chairman of the International Development Committee.

Tony Baldry

My hon. Friend will be conscious that there was rather a lot of joshing during questions to the Secretary of State for International Development about the 0. 7 per cent. target and commitments to international development aid. Can my hon. Friend confirm that the commitment of the Conservative party and its aspiration to meet that 0. 7 per cent target is no less than the aspiration of the Government to meet the 0. 7 per cent. target? It is a recognition of the difficulty of reaching that target that the Chancellor has moved to the international finance facility, which I understand the Conservative party fully supports.

Mr. Bercow

My hon. Friend is absolutely right in what he has just suggested about the explicit and long stated support of my right hon. and learned Friend the Leader of the Opposition for the international finance facility. My hon. Friend knows me well; we are constituency neighbours. He is aware that I have a number of aspirations. One aspiration that I have this afternoon is to make the position of the official Opposition on this subject clear beyond peradventure.

Mr. Challen

rose—

Mr. Bercow

I shall give way in a moment.

My right hon. Friend the shadow Chancellor has set out our plans to contain the overall level of departmental expenditure. Individual allocations remain to be decided. We are locking closely at the scope for savings and efficiency in the use of public expenditure. We are also considering the better use of money currently spent on a multilateral basis. Yet make no mistake: a future Conservative Government would be committed to Britain's overseas aid programme, for well directed bilateral Government aid has to remain a significant component of our aid strategy. I hope that the House will agree that that is a crystal-clear statement of the policy intent of the Conservative party.

Mr. Challen

rose—

Mr. Bercow

I give way to the lion. Gentleman, who has been waiting so patiently.

Mr. Challen

I am grateful to the hon. Gentleman for giving way. I absolutely agree with him that there is great deal of agreement between the motion and the amendment before us. I do not think that that is in contention. But the hon. Gentleman referred to an evil. Might he be referring to the last 20 years of trade liberalisation, which his own motion makes clear has probably contributed to increased poverty? I sometimes wonder whether people have really grasped the fact that trade liberalisation has not yet produced the goods.

Mr. Bercow

I respect the hon. Gentleman's sincerity—[Interruption.] The hon. Member for Rhondda (Chris Bryant) should endeavour to exercise what self-restraint he is very occasionally able to muster. If he wishes to be patient, I may give way. If he does not, I will not. The position is clear, and the choice is his.

Let me say to the hon. Member for Morley and Rothwell (Mr. Challen) that I greatly respect his sincerity. I do not agree with him where there is a genuine difference of opinion between us. He thinks that liberalisation of trade has been damaging. I believe that it has been beneficial, though there is much more to be done. He will not be surprised to know that I have a great deal more to say on that important subject. Perhaps we can joust in a friend') way, in recognition that we both want a decent end, but we differ about how to achieve it.

Mr. John Gummer (Suffolk, Coastal) (Con)

rose—

Mr. Bercow

I should like at this stage to make some progress, but of course I give way to my right hon. Friend.

Mr. Gummer

Before my hon. Friend returns, as I hope he will, to the point that he was talking about, would he not agree that in the world in which we live our interdependence is such in solving such problems as the challenge of climate change or the destruction of the ozone layer, or indeed of world trade, that we have to work together with countries, however poor and however restricted, and that our aid programme is a very important part of that?

Mr. Bercow

My right hon. Friend is absolutely right. There would not be a cigarette paper, or anything less noxious than that, between us on the point.

I said that we had an obligation not to worsen the situation, and that we should instead do all we could to improve the plight of the poor. I want to develop this theme. I said that although that was our obligation, it was not, sadly, reflected in public policy on an international scale at present.

The reality is that the plight of the poor is not a misfortune. It is in very substantial measure an injustice. That trade injustice from which the developing world suffers is not the result of bad weather, defective infrastructure or a natural disaster. Indeed, I go so far as to say that it is not an accident at all. It is the knowing, deliberate and calculated policy of the most powerful Governments on earth. Trade discrimination on a grotesque scale is substantially to blame for the poverty of people in the developing world. It is shameful and shameless, and we have a responsibility to address it.

I think that I am right in saying that there are three principal components of the problem. First, there is a mismatch between aid policy and trade policy. In 2002 the countries of the Organisation for Economic Cooperation and Development gave $58 billion to the poorest countries in development assistance. But there was a chronic contradiction between aid policy and trade policy.

That leads me to the second point, which is that simultaneously the developed world, the rich countries, the most prosperous on earth, were stinging the developing countries to the tune of approximately $100 billion in trade barriers.

The third feature of the equation is the impact of massive, wholly disproportionate, trade-distorting domestic agricultural subsidies. Those subsidies are on a scale of $300 billion. That is the extent of it—a sum of money that exceeds the entire national income of the whole of sub-Saharan Africa. The contradiction between aid policy and trade policy; the impact of tariff and non-tariff barriers; the impact of export subsidies and domestic protection; the effect of tariff peaks on the one hand and tariff escalation on the other—in real measure deliberately targeted on the products and capacity of the poorest people on the planet: all that is truly devastating for those whose condition we wish to improve.

Mr. John Redwood (Wokingham) (Con)

My hon. Friend is making a powerful and passionate speech against a gross injustice. I entirely agree that there is a great moral blight on the west and on the European Union for its agricultural policies and protectionism. What advice does my hon. Friend have for the new Secretary of State on how he can get some action out of this lame, weak and feeble Government, who will not stand up to the EU and demand justice for the poor of the world by demanding abolition of the disgraceful policy of agricultural protectionism, which disfigures us all?

Mr. Bercow

I am grateful to my right hon. Friend for his intervention, and the short answer is that I want the Secretary of State to put on record this afternoon—I am hopeful that he will—exactly how he intends to advance the process of trade liberalisation.

Huw Irranca-Davies (Ogmore) (Lab)

rose—

Mr. Bercow

I have referred to the overall components of the problem, but it is worthy of a brief illustration. If we examine what is happening to cotton, for example, we can see the damage inflicted by the incredibly selfish and destructive trade policies of one of the most powerful—if not the most powerful—nations on earth. I am talking about the impact of US trade policy on west and central African cotton-dependent economies. The truth of the matter is that Benin and Burkina Faso depend on cotton for 40 per cent., and Mali and Chad for 30 per cent., of their export earnings. Those countries are efficient and cost-effective producers of cotton; they need it; it is crucial to their chances of survival and development.

The United States is one of the highest-cost, least efficient and most trade-distorting producers of cotton to be found anywhere in the world. Frankly, it is a damnable indictment—I use the expression advisedly—of the US Government that they currently spend more than $3 billion a year subsidising inefficient cotton manufacture. That costs the developing world about $250 million a year and throws people out of work. The US is spending and subsidising its own inefficient cotton production, and feather-bedding 10 rather large US corporations with three times the country's budget contribution to the whole of Africa. That is the scale of what is happening.

Bob Spink (Castle Point) (Con)

May I bring my hon. Friend back to Europe? We are, of course, a member of the EU and have a crucial responsibility in Europe. Is it not disgraceful that European protectionism damages the developing world so dramatically?

Mr. Bercow

My hon. Friend is right. He will be aware, and the rest of the House should be reminded, that in 2002 the EU spent $113 billion on domestic agricultural protection. That is wrong; it inflicts harm; and I regret it.

My hon. Friend has helpfully brought me on to my second example—dairy policy. It is a serious problem. Currently, the EU subsidises every cow to the tune of about $2. 40, when there are 2 billion people in the world who live—or exist—on less than $2 a day. Britain spends approximately £4 billion on the common agricultural policy, while many countries—Kenya, India, the Dominican Republic and many others besides—have had their domestic markets, their prospects of advance and their capacity to improve their condition enormously undermined through the selfish application of that policy over a long period. It has been hugely damaging.

I am conscious—if I do not make the point, others will remind me—that there is a CAP reform package, aspects of which are welcome. However, the Secretary of State, many right hon. and hon. Members and I would agree that there is still a great deal to do and much further to go. It is not surprising that there is a pervasive cynicism about the likely efficacy of the reform package, for the simple reason that one does not need to look into the crystal ball when one can read the book. We have been there before; there have been earlier reform packages; we have seen changes made. There have been prospective alterations in, and even reductions of, the trade-distorting support, but they have not always worked.

The reality is that, in its operation over a lengthy period, the CAP has clobbered the consumer. It has clobbered the taxpayer and the small-scale farmer. It has also clobbered businesses that are dependent on agricultural products. Above all, and most central to our debate today, it has clobbered the developing world, which deserves a better deal, a chance to compete and grow, a chance to raise its expectations and to improve living standards. It should have a realistic prospect that public policy will not stop it from doing so. That is the seriousness of the issue that we are debating.

Mr. Mark Francois (Rayleigh) (Con)

I am listening to my hon. Friend's speech with great interest. Before he makes further progress, does he agree that, although he is an Atlanticist by instinct—as am I—the US bears a particular responsibility on this one issue and that it must make some concessions with its Farm Bill if the rest of the world is to make progress?

Mr. Bercow

I entirely agree with my hon. Friend. He and I have been Atlanticists together since we stood against each other for the chairmanship of the Federation of Conservative Students in April 1986. He was a fan of the US then and he is now. I was a fan of the US then and I am now, but that does not stop me criticising the US Government when what they do is wrong. We must address the question of what can be done to improve the prospects of destitute people by way of trade reform.

Huw Irranca-Daviesrose—

Mr. Bercow

I shall give way for the last time—and I mean it.

Huw Irranca-Davies

I am grateful. To return to the hon. Gentleman's previous discussion about clarity—I applaud his reasonable approach in the debate and agree with many of his points—he expressed a commitment towards many of the Government's measures, but many people would want to know whether that commitment extends to protecting or enhancing the aid budget. I agree that there must be a multi-faceted approach—there has to be, and trade liberalisation is part of it—but the international aid budget is paramount

Mr. Bercow

The aid budget is extremely important, so the hon. Gentleman makes a fair point. I would say in response, however, that I have given the most explicit statement of the current thinking of the Conservative party and I quoted my right hon. and learned Friend the Member for Folkestone and Hythe in the process. As far as I am aware, the hon. Member for Ogmore (Huw Irranca-Davies) is not a doctor. If he were, and if he were in the habit of offering his prescription before he had conducted his diagnosis, he would not be a very effective practitioner. 1t seems reasonable to study the budget, to examine what is and is not working well, to assess what measures are most effective at bilateral level and least effective at multilateral level, to reach a conclusion, to produce a policy, to outline it to the House, to put it to the country and to await the verdict. That is the eminently reasonable position that the Conservative and Unionist party has taken—

Chris Bryant (Rhondda) (Lab)

rose—

Mr. Bercow

I am probably doing the House a disservice, but I suppose I had better give way to the hon. Gentleman.

Chris Bryant

The hon. Gentleman's generosity is unbounded. He was trying to make out earlier that he was being extremely clear, but his clarity is not very clear. He is trying to suggest that he aspires somewhere towards the 0. 7 per cent. figure, but he offers no guarantee that he will move up towards that percentage at all—unless he expects that, under a Conservative Government, gross domestic product would fall, so he might get closer to the 0. 7 per cent. but the amount of money would remain the same.

Mr. Bercow

The disadvantage of the hon. Gentleman talking about clarity that is unclear is that it serves only to remind the House that he is in danger of confusing not only it but himself. That seems a regrettable state of affairs and I am not sure that I have done the House a great service by giving way to him—[Interruption.] He has had one go and made a mess of it, and I can assure him that he will not get another opportunity during this debate.

We have a responsibility to take matters forward. We need to establish freer trade and to go for liberalisation. We know what the estimates are: they range from an increase of $150 billion in world trade, as the consequence of a 50 per cent. cut in tariffs, to the prognosis of the International Monetary Fund, the World Bank and the OECD whereby a figure that ranges from $250 billion to $620 billion will be added to world trade if we go for liberalisation.

That, of course, is the theory—the prognosis—but again we should be guided by the evidence and consider the example set by countries that have themselves gone for free trade. We can see in China, India, Mexico, Vietnam and Uganda a common thread in their policy and performance: increased productivity, a greater share of world trade, a capacity re bolster their export performance and a demonstrable improvement in living standards. That is obviously good sense.

Cancun—the breakdown of the trade talks thereat—was very sad. I do not share the view of those who think it was beneficial to the world; it was extremely damaging. It is important that we get those talks back on track and I appeal to the Secretary of State to set out the Government's position explicitly and in detail, because my right hon. and hon. Friends and I are convinced that we need to remind ourselves of the objectives of the Doha development round. We need to remember the negotiating mandate agreed in November 2001; it is about improving market access, reducing export subsidies, cutting and, in many cases, phasing out those subsidies and reducing the level of domestic agricultural trade-distorting subsidy. Those critical tasks must be undertaken, and my submission to the House is that that is all about free enterprise and the practice of capitalism.

Capitalism is not a panacea; it is not perfect. The Secretary of State's distinguished father spent nearly 50 years in the House eloquently inveighing against capitalism, but in my view it is the best we have. Capitalism has three distinctive advantages. First, it is the greatest wealth-creating mechanism known to mankind; secondly, it has tended to improve living standards in every country in which it has applied; and, thirdly, it is the economic system most compatible with personal liberty. For those reasons, it is in a free-market, trade-encouraging, capitalist-oriented direction that we need to go.

Ann McKechin (Glasgow, Maryhill) (Lab)

Will the hon. Gentleman give way?

Mr. Bercow

No, not at this stage.

As we go in that direction, however, those of us in the rich western world have to examine our attitudes; we need to consider how we behave, because we require a wholly different mindset from that which has been deployed hitherto. We need an end to brinkmanship and a start to statesmanship.

I do not want to dwell excessively on the past, but it was desperately unfortunate that, at Cancun, the European Union made the major mistake of pressing ahead so insistently, for so long and to such disadvantage with the Singapore issues of trade facilitation, transparency in Government procurement, and investment and competition, when the whole purpose and raison d'être of the conference was to achieve a development round. Previously, development rounds had been principally for the benefit of the richer countries—they had focused on manufactured goods and the needs and preferences of the industrialised countries. The task now is to do something for those who have very little, yet what we have witnessed is the exertion of massive power by those who have against those who have not. That seems wrong.

Present trade policies of which the United States, the EU, sometimes Japan and China, and many others besides are guilty are morally wrong. They are economically counter-productive and politically dangerous. One-nation Tories, of whom there is a plentiful supply on the Opposition Benches today, know that Governments cannot do everything—but they can do something to help. One-nation Tories know that if one is confronted with the choice of giving people $10 a day or enabling them to earn $10 day, the latter is infinitely preferable. One-nation Tories know that it is in our attitude, and that of all democratic politicians, to the liberalisation of agriculture that the sincerity and credibility of our claims to be fighting world poverty will ultimately be tested; for 70 per cent. upwards of the world's poor live in rural areas and depend on agriculture.

I believe that we must go for free trade, and that we must open markets and liberalise. I believe that the Secretary of State should tell us more about that today, because liberalisation and free trade would be good for poor countries, good for consumers in rich countries, good for the generation of prosperity and good for the state of international relations.

Members of the House, of whatever party, presumably aspire to bequeath to our children and our children's children a world in which the blemish and scar of global poverty have gone. It disfigures the world and, in a very real sense, shames and discredits us. We need to change that. We need to reform and make progress. We need to achieve liberalisation. Let us work together and achieve something for our constituents, but above all, let us achieve something for the most destitute people on the planet. They have suffered too much for too long as a result of too selfish policies. It is time that that was changed.

1. 46 pm

The Secretary of State for International Development (Hilary Benn)

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof: welcomes this debate and congratulates the Trade Justice Movement on its efforts to raise public awareness of this vital issue; reiterates the commitment made in the White Paper Eliminating World Poverty: Making Globalisation Work for the Poor to improve international trade rules; urges the European Union to make further progress on reforming the Common Agriculture Policy regimes for cotton, sugar, tobacco and olive oil; welcomes the UK's call for action on HIV/AIDS; congratulates the Government on the £160 million it has allocated to trade-related capacity building in developing countries since 1998; welcomes the fact that the UK's aid budget for Africa will rise to over £1 billion by 2005; welcomes the launch of a new initiative, the Commission for Africa, to take a fresh look at the challenges Africa faces; notes that a successful Doha Round could contribute substantially to the achievement of the Millennium Development Goals; congratulates the Government on the lead it has taken within the EU and the WTO to promote free and fair trade; believes that significant progress must be made to improve access for developing country exports to both developed and developing country markets, including through substantial reductions in trade distorting agricultural subsidies; calls on all WTO members to continue to demonstrate their commitment to the Doha Development Agenda; and underlines this House's commitment to ensuring the Doha Round produces real benefits for the poor. I very much welcome the opportunity to hold this debate. I also welcome much of what the hon. Member for Buckingham (Mr. Bercow) said and the passion and characteristic eloquence with which he said it, which got us off to an extremely good start.

I listened with particular interest to the words that the hon. Gentleman read out about Conservative spending commitments, but I have to tell him in all honesty that I am not much the wiser. It sounded as though the words had been drafted by a lawyer, so although we shall try to appreciate exactly what the Conservative party's aspiration is on the figure of 0. 7 per cent., I hope that he and other colleagues will forgive us if we look at the record. When the Labour Government left office in 1979, we were spending 0. 52 per cent. of our gross national income on overseas aid, but when we returned to office in 1997, spending was 0. 26 per cent. That was the legacy bequeathed us by the Conservatives, so I am afraid that the record of the hon. Gentleman's party hangs like an albatross around his neck. He will have to grapple with that, although I am sure he will do so ably.

I, too, welcome the fact that the debate is taking place at the beginning of Fairtrade fortnight, which is all about the things that we can do personally to try to remedy the inequities of the current trade system. The fair trade movement is all about consumers trying to ensure that poor producers get a fairer return. The idea is simple: it reaches out across the globe and connects buyer and seller, and does not depend on the world trade talks for something to happen. That is what makes it so powerful. We can see the results in the sharply growing market for Fairtrade products—tea, coffee, orange juice, flowers, footballs, bananas—which are increasingly available on the shelves of leading supermarkets. It is estimated that fair trade is worth £100 million a year. We support the Fairtrade Foundation and I take this opportunity to thank it for its work.

Ethically sourced and fairly traded products are only part of the solution to what the hon. Gentleman rightly described as a series of complex challenges facing poor producers and developing countries. I agree with him that what we really need to do is to help developing countries gain access to the global marketplace and to create fairer trade rules in the World Trade Organisation.

The first thing for the House to acknowledge, however, is how far, in one sense, we have already come. From the earliest times, the history of human relationships has, in part, been the history of trade and, as trade has grown and become global, we have established systems to try to manage it. For some, trade has brought enormous wealth; for others—especially those denied access to the markets of the world—it has not, and the hon. Gentleman spoke clearly about the consequences of that.

For almost half a century, the general agreement on tariffs and trade was primarily concerned with tariffs on industrial products and was dominated by the developed countries. Agriculture, which is the issue for developing countries, was included in the multilateral negotiations at the Uruguay round, concluded a decade ago—about the time that the WTO itself was created.

Today, we are talking seriously in Geneva about an end date for export subsidies. With last summer's historic breakthrough on CAP reform, we are committed to making significant reductions in trade-distorting domestic subsidies. This is a very substantial change compared with a generation ago, and over that same period the link between development and trade has become central to the multilateral trade negotiations. Never mind a decade ago—40 years ago it would have been inconceivable for the Chancellor of the Exchequer and the Secretary of State for Trade and Industry to be such passionate advocates of the interests of developing countries in trade talks.

In the same way, it is inconceivable that 40 years ago we would have seen something like last summer's record-breaking mass constituency lobby organised by the Trade Justice Movement, in which I know many hon. Members took part. That lobby showed the extent of the groundswell of public opinion in support of freer and fairer trade. I take the opportunity, as the original motion and the Prime Minister's amendment do, to pay tribute to the Trade Justice Movement for the work it has done to make this happen and for keeping the issue at the forefront of the public's mind. All that passion, and all that commitment, which is shared by many people across the world, helped the UK to play its part in bringing trade and development issues to the fore, including in the result of the Doha round.

Mr. Patrick McLoughlin (West Derbyshire) (Con)

What did the Secretary of State find so objectionable in the motion tabled by the Leader of the Opposition that the Government felt they had to amend it?

Hilary Benn

There is much in the motion with which I agree, but the amendment includes things that it did not cover, and I invite the House to support the amendment at the appropriate moment.

Mr. Gummer

The Secretary of State could have agreed with the motion, and we could all have begun Fairtrade fortnight with a united motion. Would it not have been better if he had been a little less churlish and had said that the motion might nom g o as far as he would like but that he would accept it to show that both sides agree on these matters?

Hilary Benn

I think that the debate has already demonstrated that there is a shared analysis and a lot of common ground—one or two things divide us—but I would return the request to the right hon. Gentleman and simply say, in that same spirit, that I look forward to seeing him in the Lobby in support of the Prime Minister's amendment when that moment arrives.

Mr. Robert Walter (North Dorset) (Con)

Will the right hon. Gentleman give way on that point?

Hilary Benn

It is a third go but I am a generous soul, so of course I give way.

Mr. Walter

I have studied the Prime Minister's amendment closely and it uses the words, urges the European Union to make further progress on reforming the Common Agriculture Policy regimes for cotton, sugar, tobacco and olive oil". Does that mean that the Government have given up on any further reforms to the common agricultural policy and that we are going to be stuck with European farmers being subsidised to the tune of nearly €50 billion a year?

Hilary Benn

No, it does not mean that because the Government have clearly set out their view on the need for reform, but the amendment also makes specific reference to the products that the hon. Gentleman has just read out.

Mr. Jim Cunningham (Coventry. South) (Lab)

Does my hon. Friend recall that successive Conservative Governments promised to reform the common agricultural policy but singularly failed to do so?

Hilary Benn

I do indeed, and if the House were being honest with itself it would recognise that reform of the CAP has been a consistent theme running through our political debates in the House for 30 years, which is what makes the agreement that was reached last summer, with the tireless efforts of my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, such an achievement.

If the current round is to succeed, it must address the unfairness of the world trade system, whereby, for example, developing country cocoa producers receive only a fraction of the retail price of products such as chocolate. Developing countries have 90 per cent. of the world market in cocoa beans but just 4 per cent. of global chocolate production. That is just one example of how little of the final value is captured by developing countries.

Why does all this matter? First, it matters because three quarters of the world's poor live in rural areas and 96 per cent. of the world's farmers live in developing countries. As the Chancellor of the Exchequer said recently, when 900 million farmers in poor countries struggle to survive on less than a dollar a day while rich people in rich countries spend millions a day on subsidising agriculture, something is very wrong and it has to change.

Secondly, it matters because there is a great deal of evidence that the opening up of trade contributes to higher economic growth, which is just what developing countries need. For example, in the 1990s, while average income fell by 1 per cent. a year in developing countries with high trade barriers, it rose by 5 per cent. a year in those with fewer barriers to trade. The World Bank estimates that up to half the gains from eliminating barriers to merchandise trade would accrue to developing countries, which could lift more than 300 million people out of poverty by 2015.

Ann McKechin

My right hon. Friend has made a very correct point about the need to reduce barriers, but does he agree that the least developed countries are not likely to gain as much from trade liberalisation as countries such as China and India, and that the aid budget and the amount of aid that we give in debt relief therefore still remain the most vital elements?

Hilary Benn

I do agree with my hon. Friend. That is why a rising aid budget—rising support—is so important, and it is also why the way in which countries are asked to open up their trade is so important. I intend to come to that point later.

Mr. Bercow

Will the right hon. Gentleman give way?

Hilary Benn

I will give way, although I want to make progress; I know that many other hon. Members want to speak.

Mr. Bercow

I am sorry to interrupt the flow of the right hon. Gentleman's eloquence—or even the eloquence of his flow—but it seems to me that in recognising that over decades the common agricultural policy has been the most protectionist racket known to mankind, we need to know in some reasonable measure of detail how the Government intend to proceed. Could the right hon. Gentleman give some indication of what stance the British Government are taking within the European Union, in respect of the CAP as a whole at the development negotiations, and in respect of a number of the commodities to which his amendment refers?

Hilary Benn

Indeed, I will. If the hon. Gentleman will contain himself a little while longer, I intend to come to those important points.

The third reason why all this matters is that it is through economic development that we stand the best chance of enabling poor people in poor countries to earn and trade their way out of poverty. Africa is the only continent that has actually got poorer in the last generation; its share of world trade has halved. It cannot even hang on to just under half of the savings that it generates each year, and yet we know it needs to grow at 7 per cent. a year if we are to have any prospect of meeting the millennium development goals.

Fourthly, all this matters because the longer the multilateral trade system fails to deliver for the world's poor, the longer poverty will persist and basic services such as health care and education will be denied. I saw one of the consequences of that during my recent visit to Ethiopia. I shall never forget visiting the health centre in Mekane Salam, which serves a community of 180,000 people but has no doctor. One consequence of the lack of a doctor is that when women come in with complications of pregnancy, and the people who work very hard to run the centre realise that they cannot assist, the women are referred on to the hospital 100 miles away. When I asked what happened to those women, the staff said, "To tell you the truth we have no idea how many of those women make it, because there is no transport to take them to the hospital. There is a bus once a week, but they have to be able to afford the fare, and they might well die of the complications of pregnancy before the bus arrives. " That is really all the illustration that the House needs, and it comes from a recent experience of mine, which demonstrates why this matters, because this is about the daily lives of fellow human beings of ours, who do not benefit from the things that we take for granted. That is one reason why 2005 will be a year both of opportunity and of expectation—expectation that this time we, collectively, the world, will deliver.

What are we doing? That is the challenge that the hon. Member for Buckingham put to me. We recognise the failure of the Cancun meeting, although the one thing that did come out of Cancun was that the voice of developing countries was heard more loudly and clearly than at any previous world trade talks, and I, for one, unreservedly welcome that.

Between now and 2005, the US elections will take place, the existing Commission for Africa will come to the end of its life and a new one will be appointed, and elections will take place in many other WTO countries over the next two years. That has led some people to question whether it will be possible to make progress in the world trade talks. I happen to think that progress can be made, not just because of the consensus on trade justice issues that has been expressed in recent debates in the House and elsewhere, but because everyone now recognises that the Cancun meeting was a missed opportunity, a failure of political will. I hope that that will encourage everyone to work much harder next time to ensure that we are successful.

What do we need to do, and how will we do it? That is the key question. First, we must get developed and developing countries to engage in the round and to open their markets, particularly to the least-developed countries. Secondly, we must secure new agreements on the issues that matter most to developing countries— agriculture and non-agricultural market access. We must also push—the hon. Member for Buckingham did not refer to this in his speech—for more effective special and differential treatments, to which I shall return. We will help developing countries to adapt to their new obligations through the development of appropriate adjustment mechanisms. What are we doing to try to help to make that happen?

The round will not be a true development round if the WTO and its members retreat into protectionism; developed and developing countries must stand up to powerful domestic lobbies. There are some recent encouraging signs of greater engagement and a new resolve to make progress. Both Bob Zoellick and Commissioner Pascal Lamy are now talking to a range of WTO members, and member states are talking about what they need to do to get the round back on track. That underlines the need for, and the responsibility of, the richer WTO members to seize the initiative, show leadership and make meaningful offers and concessions to get the round back on track.

I agree very much with the point about the new issues, to which the hon. Member for Buckingham also referred, that the International Development Committee made in its very good report on the lessons of the Cancun meeting. The honest truth is that the developing countries have made their position very clear on investment and competition. At the end of the Cancun meeting, those issues were taken off the table, and I have said on a number of occasions that, having disappeared from the table, they should stay off the table. There are sound arguments about why it is good to make progress on public procurement and trade facilitation, but, in the end, they should not stand in the way of achieving a development round, and we need to be absolutely clear about that.

Chris Bryant

This is, in a sense, a slightly different issue, but my right hon. Friend refers to a series of issues that was taken off the table. Audio-visual and cultural services have been included in previous rounds in a rather negative way— France has tried to protect itself against American trade—but China, which has come into the WTO in the past few years, is trying to ensure that audio-visual services, such as free and independent news, are not made available in China. Could we not use the next round, when one comes along, to ensure that China opens up its market in the interests of ending human rights abuses?

Hilary Benn

My hon. Friend raises a number of issues that will be the subject of debate. As a matter of general principle, free news media are very important features of any society that hopes to function and thrive. All our experience demonstrates that independent media help to promote good governance. They make the Government's life difficult from time to time, but we have to live with that in the interests of democracy.

Mr. Challen

Will my right hon. Friend give way?

Hilary Benn

I want to make a bit of progress, and then I will give way.

New developing country groupings emerged at the Cancun ministerial meeting. One of the things that we have to recognise is that the interests of developing countries are not uniform, and we saw that with the G20 group and the G90 alliance. They, too, have a responsibility to help to move the negotiations forward. In particular, they need to reduce the barriers to south-south trade because countries such as India, Brazil, China and other significant countries stand to benefit, alongside the poorer producers, from trade liberalisation. South-south trade now accounts for more than a third of developing country exports—about $650 billion.

The World Bank suggests that, during the past 15 years or so, developing countries' own liberalisation has been the primary channel through which trade reform has expanded their export growth. For example, negotiations on a common market are taking place as we speak between Kenya, Tanzania and Uganda. Those countries tried to agree on that 20 years ago, but they failed. They are now close to making that happen finally. That is a good example of some of the steps that developing countries can take to help themselves, but the hon. Gentleman is right to suggest that there is recognition that, to make progress, the EU and the US must offer more on three main elements of agricultural negotiations: first, market access; secondly, an end date for export subsidies; and, thirdly, a substantial reduction of trade-distorting domestic subsidies.

Many developing countries have a comparative advantage in agricultural exports, yet, as we have heard, the developed world uses taxpayers' money to block that advantage. We therefore continue to take steps to promote further agricultural reforms to benefit the world's poor, including a reform of the EU sugar and cotton regimes. The hon. Member for Buckingham referred to cotton, and I shall take a moment to address that very issue. He clearly set out why the west African cotton producers face unfair competition.

We need to find a solution to trade-distorting cotton subsidies, as part of the negotiations on agriculture, but there is a need to move swiftly on to consider what can be done to secure the livelihoods of thousands of west African cotton producers, who would be highly competitive on world markets if it were not for EU and US subsidies. They need our help now and until subsidies that lead to over-production are phased out. Their plight is one of the starkest examples of unfair trade rules. In the US, cotton producers received nearly $4 billion in assistance in 2001–02 That is more than the entire gross domestic product of Benin—to which the hon. Gentleman referred—where the cotton industry, which is now in crisis, accounts for 85 per cent. of exports.

West African states that have followed the prescriptions of the World Bank and IMF and ended all subsidies to producers now and that they have liberalised into a highly distorted market and are paying the price. Unless we make progress, we risk undermining their confidence in the interests of liberalisation and their faith in the WTO. The US and the EU must take steps to resolve that issue. The Government are working to get the EU to agree to significant decoupling, and I discussed that with Commissioner Lamy when I was in Brussels recently. The European Commission has now made a proposal to EU member states, but we need to go further.

The same is true of sugar, but in the interests of time—other hon. Members wish to speak—I wish to get on to the third issue: the need for WTO agreement to take account of the specific needs of developing countries, which are at different levels of development. Special and differential treatment is the development jargon used to describe that issue, but it must be an integral part of the negotiations, so that poorer WTO members can implement trade reforms at a pace that enables them to exploit the benefits of trade liberalisation. My hon. Friend the Member for Morley and Rothwell (Mr. Challen) referred to that point in his earlier intervention, and if he wishes to intervene now, I shall give way to him.

Mr. Challen

I am grateful to my right hon. Friend for giving way. The hon. Member for Buckingham (Mr. Bercow) made clear his philosophical attachment to capitalism. I shall not necessarily ask my right hon. Friend to replicate that, unless he wishes to do so, but I ask him to consider the role of the City and financial institutions in developing fair trade. When we go to coffee or cocoa growers and say, "You must grow this cash crop to sell to us", we end up with a glut and they end up with very little income. As has been said, they receive 4 per cent. of the price. Should we have floors to guarantee prices? Should we ask financial institutions to contribute to the process?

Hilary Benn

My hon. Friend makes an important point about commodities. I am afraid that all those devices to which he draws attention have been tried in recent years to deal with the problem of low coffee prices, but the fundamental difficulty is one of oversupply. One of the reasons for that is that there has been a big, new entrant into the market, Vietnam, which has been spectacularly successful in reducing poverty, but there is too much coffee in the system as a consequence, thus depressing the price.

We may all be travelling in the same direction, but different countries are able to travel at different speeds. We must take account of their interests.

Part of what we can do over the next 12 months to prepare the ground for further progress on the world trade talks is to work with Governments of developing countries so that they can think through the consequences of the changes that might be made. The money that the Department for International Development gives for trade-related capacity building means that we can work with trade Ministries to provide advice and support to help countries to think through what the changes might mean for them, which is a practical contribution. However, I must say that the trade Ministers whom I have met were extremely capable and able to work out what was in their interests.

We are just over a decade away from 2015, which is the year when we will be judged and we will judge ourselves on the progress that we have made on helping to lift our fellow citizens out of poverty. We all have the responsibility to ensure that the fine words and commitments that we utter turn not into distant promises but into results. We need to reduce the number of people who live in absolute poverty and ensure that fewer children die before they reach their fifth birthday of diseases that we know we have the means to treat, although those means are lacked in the communities in which they live. We should enable more children to have a teacher, a classroom, a desk and a textbook and to go to school—130 million children in the world currently do not go to school.

Achieving those goals will require us to make progress on not only trade, but aid, conflict, debt, good governance, human rights and the environment. If we get things right and pull the challenge off, 2005 can become a year not of disillusion, but of promise. I hope that it will be a moment that we can look back on as a time when the development movement, the development argument and the development idea truly came of age. I hope that it will be a year in which the people in the community in Ethiopia whom I visited three weeks ago will come to know that the world did not visit them only to look and see, and that we went away, learned, and did something to try to improve their lives.

2. 12 pm

Tom Brake (Carshalton and Wallington) (LD)

I congratulate the hon. Member for Buckingham (Mr. Bercow) on securing the debate, which is important at the beginning of fair trade week. I agree that there is a degree of consensus in the House on the matter. Through his oratory, he almost—but not quite—lulled me into thinking that I did not need to highlight some of the problems that he faces in his role—the Secretary of State referred to those problems. However, it is instructive to consider the Conservative party's record, if only to appreciate how much more needs to be done.

The Secretary of State said that the percentage of our gross national income spent on international aid halved during the period of Conservative government. The hon. Member for Buckingham says that the issue is less about the international development aid budget than about trade, but there are still problems—indeed, he highlighted those himself. Over the past two decades, the percentage of total world trade enjoyed by the least developed countries has shrunk by nearly 50 per cent., so no significant improvements have been made in the international aid budget or the situation of those countries over the past 20 years.

Mr. Bercow

For the avoidance of doubt, let me tell the hon. Gentleman that overseas aid, including technical assistance, capacity building, the provision of medicines and the establishment of communication networks, is incredibly important, as is the proper recognition of the prerequisite of property rights as a basis for successful free-trade economies. I am simply arguing today about trade, but other things are important, too.

Tom Brake

Other things are important, but so is the international development aid budget.

In the spirit of consensus, we will support the motion. Broadly speaking, we are comfortable with its wording. However, it might be worth pointing out slight differences between the motion and what the Trade Justice Movement says. The motion says that the House shares the concern of the Trade Justice Movement about the plight of the poorest people in the world, and congratulates the Movement on bringing their conditions to the attention of the public". It goes on to say that the House believes that trade liberalisation and increased international trade offer the best hope of alleviating poverty". It is worth pointing out that the Trade Justice Movement's website calls on world leaders to stop forcing…countries to open their markets and champion their rights to manage their own economies. Thus the motion and the TJM put a different emphasis on international trade.

It is appropriate to consider the new initiatives that the hon. Member for Buckingham has brought to the table. I listened carefully to his speech but was unable to identify any new proposals in it. I had expected him to talk about the advocacy fund to which the Leader of the Opposition referred on Monday. That appeared to have been the announcement of the day—the summary on the Conservative website suggested that it was the single new proposal. As the hon. Gentleman knows, the fund is not a new proposal because the idea has been around for six months or more.

Mr. Bercow

It is always a pleasure to joust with the hon. Gentleman, but he is on thin ice here. Of course I endorse and regularly promote the arguments for an advocacy fund, as my right hon. and learned Friend eloquently did in his speech to the Conservative party's trade justice forum on Monday morning. That was not the only feature of his speech, nor was it the main feature, and it did not need to feature in my speech today. It is important, but it is part of a picture, and I wanted to develop other parts of the picture today. I should not have thought that that was terribly controversial.

Tom Brake

I understand that point. I referred to the advocacy fund on1y because it seemed to be the only concrete proposal that was launched—or reannounced—on Monday, but reference was not made today to the fund or to any new concrete proposals that a Conservative Government, if elected, would put in place.

There are significant contradictions in Conservative party policy. The hon. Gentleman advocated development in India. yet on the Conservative website the shadow trade Minister is critical of the fact that certain jobs have gone to India. I do not want to be misquoted outside the Chamber, so I am not saying that the loss of British jobs is a good thing—clearly, it is not. However, a logical consequence of the reduction of trade barriers is that jobs will go to India rather than remaining in the UK.

Mr. James Arbuthnot (North-East Hampshire) (Con)

The hon. Gentleman needs a bit of an explanation, given the way in which he misdescribes our policy. We suggest that if the Government regulated a little less in this country, companies might not be forced to send their jobs overseas. We have no objection whatever to jobs being clone in India that can be done much better there.

Tom Brake

I thank the right hon. Gentleman for that clarification, but he should perhaps read the website to find out precisely what the shadow Trade Secretary was saying—

Mr. Bercow

He is the shadow Trade Secretary!

Tom Brake

Sorry, I should have said the shadow industry Minister—there is a slight difference. The right hon. Member for North-East Hampshire (Mr. Arbuthnot) should refer to what his colleague the shadow industry Minister said on the subject.

We understand that the question of whether a future Conservative Government would freeze the international development budget will be addressed along with the consideration of other budgets. If a decision has not been taken, it is worth outlining the financial consequences of such a freeze. According to the House of Commons Library, if the, freeze were to be applied at the 2004–05 level, the financial consequences would be about £750 million—a significant sum, which I hope the hon. Member for Buckingham will quote in arguments with his right hon. and hon. Friends to safeguard as far as he can the international development budget. In view of the announcements about a possible freeze, I thought that the Secretary of State would be rubbing his hands in glee and salivating at the 'prospect of taking on the hon. Gentleman, but the right hon. Gentleman is a different character from the Secretary of State for Defence and has not taken the opportunity offered by this debate to launch into the proposals.

The Government have lots of which to be proud—I am happy to put that on the record. Breaking the link between trade and aid was entirely appropriate, as is the focus on the poorest countries. The general trend in the proportion of gross national income contributed is going in the right direction—although the Secretary of State will be aware of the blip that occurred in the last year for which figures are available, when, regrettably, that trend went in the wrong direction.

There are a couple of issues on which our agreement is less secure and our paths diverge, including the Commission for Africa and the prospect of the international finance facility delivering the goods—the £50 billion. I hope that the Minister who responds to the debate can update us on who is backing the IFF. What happens if, for example, countries cannot deliver on the commitments they made or provide the international development budget that they had intended to provide? What happens in the event of another shock like HIV/ AIDS or some other significant occurrence that causes additional funds to be required? Is there not a risk that the available funds will have been earmarked and further funds will not be forthcoming?

On the Commission for Africa, I can do nothing better than quote the organisers of a small nongovernmental organisation, who ask whether we need "another talking-shop. " Bob Geldof has said that that is not what the commission will be, and it is not what the Secretary of State wants it to be, but the jury is out on what the commission can achieve. The announcement has been made, but the commission's terms of reference do not mention—at least, the summarised version does not; the detailed documentation might say more—the issue that I raised with the Prime Minister earlier today: the role that UK arms sales to African countries involved in violent regional conflict play in international development terms. The Prime Minister has said on the record, without caveat, that we prevent small arms sales to Africa. Clearly, that is not the case. I would like the Minister to comment on that and say whether the commission will be able to examine the matter.

Tony Baldry

Surely it is extremely good news that during Britain's chairmanship of the G8 we will again focus on Africa and return to the war on poverty, having been for so long preoccupied with the fight against terrorism. Should not the Liberal Democrats support that aspect of our presidency of the G8, which we will hopefully follow up during our presidency of the European Union?

Tom Brake

I hear what the hon. Gentleman says, but I question whether the Commission for Africa offers any added value. The Secretary of State and the Prime Minister have said that international development will be a priority for the G8 and EU presidencies, but we shall see. I am open-minded and willing to wait for what the commission produces, but I am not yet convinced that it will deliver the goods.

I hope that the Secretary of State will be able to answer one question about the membership of the commission. The Prime Minister of Ethiopia is to be a member of the commission, and I hope that that will provide a stronger focus on the Ethiopia-Eritrea issue—or at least that sight will not be lost of that important matter. On Saturday, I had a meeting with representatives of the Eritrean community, who are concerned about the stance adopted by the Ethiopian Government in respect of the boundary commission. The Eritreans consider the rulings to be final and binding. Perhaps the right hon. Gentleman will say whether he thinks that Ethiopia is breaking the agreement and whether the Commission for Africa offers an opportunity either to examine the issue, or to raise it with the Prime Minister of Ethiopia.

It is interesting to note that the summary of the commission's terms of reference makes no mention of agriculture. I am sure that the Secretary of State will be able to confirm that that will be a significant aspect of the task that the commission is to perform.

The Liberal Democrats believe that free trade needs to be balanced with wider public needs, such as a cleaner environment, civil liberties, protection of local cultures and so on. We accept entirely that the international trade system is stacked against the poorest countries.

Jeremy Corbyn (Islington, North) (Lab)

Is the hon. Gentleman aware of the huge concern and, indeed, the deep anger felt in many African countries when trade agreements are reached that force African Governments to privatise public services and utilities and to close many important public services, all in the interests of building an open free trade system, which then becomes easy picking for powerful western-owned privatised utility companies, some of which started life in this country when the Tory Government privatised the utilities?

Tom Brake

Yes, I am well aware of those issues, although I suspect that I shall not have time to address them in my speech. The hon. Gentleman has made a strong point to which I am sure the Secretary of State will respond. Better regulation of corporate behaviour is clearly needed—for example, regulation to prevent transnational corporations from exploiting individuals, countries or resources. Perhaps transnational corporations should be made accountable here in developed countries for their activities in developing countries.

The collapse of the Doha round could be seen as a disaster, but I think that it may simply have been a natural adjustment of the various lobbies at work in the World Trade Organisation. There is the potential to reform the WTO to take account of the different interests. I hope that the Minister who winds up the debate will say how it might be possible to represent both groups such as the G20, which contains strong exporters of agricultural products, and developing countries that are net food importers and would be heavily hit by policies that the G20 countries support. The Government must consider how the different preferences can be reconciled, but the developing countries must state in more detail what they want to get out of the WTO. What they do not want from it is clear; what they do want is much less clear.

A number of hon. Members have referred to agricultural subsidies, which are key. I sent out a number of e-mails asking people what they would discuss if they were participating in this debate. Someone said, "Agricultural subsidies, agricultural subsidies, agricultural subsidies", which is less succinct than "Education, education, education", but it gets across the message that agricultural subsidies are key.

To enable other hon. Members to speak, I shall conclude by saying that the debate is less confrontational and more reflective because of the general consensus on the important issues. That should not disguise the fact that the issues are a matter of life and, regrettably, death for people in developing countries. Developing countries do not want compassion, and I have yet to be convinced that they want commissions. They want concrete commitments—indeed, their survival depends on them. If the Secretary of State for International Development secures such commitments when the UK holds the presidencies of the EU and G8, people in developing countries will hold him in high esteem. If he does not do so, the despair in developing countries can only deepen.

Mr. Deputy Speaker (Sir Alan Haselhurst)

Order. Six hon. Members indicated earlier that they want to speak in the debate, and I hope that the length of hon. Members' speeches will reflect that.

2. 31 pm

Huw Irranca-Davies (Ogmore) (Lab)

I shall restrict the length of my speech.

I welcome this timely debate. Whether the hon. Member for Buckingham (Mr. Bercow) or the shadow Cabinet secured it, it shows that the House keeps a serious watch on these matters. We all focus on our constituencies and on domestic matters, but what is happening overseas also concerns us greatly. If we can keep the issue on the agenda, we will do ourselves a lot of good—I shall consider that point in a moment.

I welcome the general mood expressed by both Opposition spokesmen, the hon. Members for Buckingham and for Carshalton and Wallington (Tom Brake). There is general agreement on the way forward, but differences on some of the detail. I want to give the hon. Member for Buckingham an opportunity to pick up on a point that I know he did not intend to make.

When we debated this issue one year ago, a Conservative Member made a speech that seemed to advocate old-style, free market economics—unfettered trade, bringing down the barriers and letting all hell loose. I am sure that the hon. Member for Buckingham does not advocate that. Indeed, I saw him nodding when we discussed special and differential treatment as we open up trade. I would welcome an intervention from him because it would do him credit to clarify that point.

Mr. Bercow

I am happy to provide the hon. Gentleman with the reassurance that he seeks. First, special and differential treatment is important. One can argue the toss about how it works, but the need for it has been established. Secondly, we do not live in utopia, and no such destination is likely. We must work in a practical way with gradual liberalisation in the promotion of free trade and recognise that different countries are in different situations and therefore necessarily start from different positions. We must have a clear target and an end date for some of those reforms.

Huw Irranca-Davies

The hon. Gentleman's clarification gives us a good basis from which to move forward with, as far as possible, cross-party consensus.

I want to focus on why we should support the aims of the Trade Justice Movement, the Fairtrade Foundation, which is supporting many events in my constituency over the next fortnight, and the Government. Opposition Members have recognised that the Government are undoubtedly trying to exert pressure in the right places. Although we cannot secure everything that we want—the reform of the common agricultural policy or of World Trade Organisation agreements—the impetus towards satisfying the needs of developing countries is firmly entrenched within the Government's credentials. The more support that Back Benchers and non-governmental agencies provide, the better, particularly as we move into the next round of talks.

Jeremy Corbyn

Does my hon. Friend think that we should also put considerable pressure on the United States because of its food-dumping policies? Those policies are, in effect, a subsidy for the farming lobby in the United States. They destroy agriculture in the developing world and lead to poverty, shantytowns and mis-development, which we all dislike.

Huw Irranca-Davies

I entirely agree with my hon. Friend. We also have a lot to do within the European Union. The hon. Member for Buckingham made the point that we cannot aim at utopia, but we must keep pushing at the problem. As Oscar Wilde once said, there is no point in having a map without utopia marked on it. We must move towards utopia, while recognising that we will not get there tomorrow.

Why is trade justice good for us? It is different from the feel-good factor that we get from putting a donation into a charity box; in fact, it is not charity at all. It is good for us because it will put money back into our pockets, if we can do it correctly. Hon. Members have mentioned the £45 billion of CAP funding that we put into the European Union. However, the position is worse than that because, as fellow Europeans, we spend about £50 billion over and above the odds to pay for subsidised products, and we are doing ourselves down.

If we can develop effective trade liberalisation that works to the benefit of developing countries and ourselves, and if we can work to bring down barriers in the US and Europe, we will put money back into our pockets, and most importantly back into the pockets of some of the poorest people in my constituency. There is a strong argument to be made.

Mr. Kelvin Hopkins (Luton, North) (Lab)

To reinforce my hon. Friend's point, it has recently become obvious that every single region of Britain is a net contributor to the European budget simply because of the operation of the CAP. I have made the point to my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs that we are well placed to call for the abolition of the CAP and its replacement by different forms of agricultural subsidy.

Huw Irranca-Davies

The point is well made. A typical, four-person household spends about £1,000 more than it should every year on the CAP. Forget about council tax reform and the balance of funding review; households are needlessly spending £1,000 a year. We must move away from the archaic CAP funding formula.

A point was made earlier in the debate about capitalism, but I will not get into ideological warfare.

Mr. Andrew Love (Edmonton) (Lab/Co-op)

Oh, why not?

Huw Irranca-Davies

I will not be tempted down that route. A prime foundation of socialist movements is socialism not only on one's doorstep but internationally, which relates to my next point on intra-generational equity. Rising prosperity in this country is not good enough. In November, the Joseph Rowntree Foundation independently pointed out how many people we are lifting out of poverty —there is much more to do—but we must also lift people out of poverty on a worldwide basis.

Mr. Bercow

I respect the hon. Gentleman, and wait with bated breath and with beads of sweat upon my brow for his views on intra-generational equity. In all politeness and sincerity, I put it to him that the position is, as Sir Robert Peel once said, that the vice of capitalism is its unequal distribution of blessings; the virtue of socialism is its equal distribution of misery.

Huw Irranca-Davies

Very well put. I am pleased to see that we have a measure of agreement. We cannot have unfettered capitalism, and we need controlled measures to avoid breakdowns in markets, which result in abject poverty.

I will not go into the realm of intra-generational equity, although I lectured on the subject for six years. If we were to reduce barriers and to away with distorting subsidies, as much as £620 billion—the conservative figure is £250 billion—would he released into the world economy. At least half of that would go directly to developing nations, if it were done in the right way. It has already been said that 1. 2. billion people in the poorest parts of the world live on less than $2 a day, which is lower than the subsidy per capita for a single European cow. There were disappointments at Cancun but hopefully, as my right hon. Friend the Secretary of State said, that will give us the energy to proceed with stronger resolve. However, without a doubt, Cancun showed that we need to strengthen the voice of developing nations. That started to happen at Cancun and, in response to people who say that liberalisation will tear developing countries apart. let me say that I believe that we need to ensure that those countries have a voice at the seats of power, not only in the WTO but in other worldwide non-governmental agencies. The Government share that aspiration, and we must work to make that happen.

Many church groups, such as the Catholic Fund for Overseas Development and Christian Aid, have been involved in the movement for trade justice. The summary that Christian Aid provided for today's debate says that it supports the reform of EU agriculture subsidies and the reduction of trade barriers to give poor countries a fair deal". However, it goes on to say that the reform of those subsidies and the reduction of trade barriers …should not be granted in exchange for far-reaching liberalisation in developing countries themselves. In particular the EC should endorse the rights of developing countries to protect their poor farmers from unfair competition. I should be interested to hear how the Under-Secretary of State for Trade and Industry, my hon. Friend the Member for Edinburgh, South (igel Griffiths), defines special and differential treatment, because the history of countries that have developed rapidly and enjoyed long-term prosperity is that in the early stages they needed appropriate measures to prevent all hell from breaking loose in free trade.

Trade justice is good for the world, international agencies and Governments. If we can make a success of the next round of talks, that will dramatically improve our relations with developing nations. There were disappointments after Cancun, but the members of the G90 are starting to flex their muscles and assert themselves. As far as possible, we must force the pace of CAP reform and discussions with the Americans on their own trade barriers and tariffs. I should be grateful if the Minister would explain his thinking on the so-called Singapore issues, particularly the removal of investment and competition from the agenda, before he goes into the next round of talks.

I urge the House, people listening to our debate, and those who marched to Parliament last year to crack on with the trade justice agenda, and to ignore the detractors, many of whom will point to the failure of talks. We are moving forward and doing the right things. We should be proud of what we have achieved so far, but should recognise that it is not enough. The Government amendment urges the European Union to make further progress on CAP reform on cotton, sugar, tobacco and olive oil, and takes note of the £160 million that the Government have allocated to essential trade-related capacity building in developing countries since 1998. The aid budget, which I mentioned earlier, will, in the case of Africa, rise to over £1 billion by 2005. We should be proud of those achievements and of the efforts of many people up and down the country. Members of the Trade Justice Movement are reasonable, responsible, well informed and, as we saw last year, well behaved in their protests. I pay particular tribute to the branch of the Trade Justice Movement in my constituency. Its members are holding a coffee morning on Friday—I cannot attend, but my sentiments are with them.

2. 44 pm

Mr. John Gummer (Suffolk, Coastal) (Con)

There is considerable common ground on these issues among Members on both sides of the House. I remind the House of my entry in the Register, because much of the work that I do outside the House is to try to help companies behave better and more effectively in developing countries. We have accepted that there is a common view, and I do not have to repeat my long-term support for trade justice. However, I urge the House to pay attention to the problems that we have to face. I am sorry that the Government do not agree with our motion, but their amendment has the advantage of reminding us of some of those problems. As the Secretary of State has said, the developing countries are not an amorphous mass dealing with the same issues and concerns. They have a great need to trade among themselves but must recognise that some ways of liberalising trade and getting rid of distortions can do huge harm.

I shall use the example of sugar, which the Secretary of State discussed. Perhaps we should always talk about sugar rather than cotton, because we do not grow cotton, so it may appear that we are pointing the finger at those who do. We do grow large amounts of sugar, which is an important part of crop rotation in constituencies such as mine. We are therefore not making a vague argument about the need to get rid of a dreadful system to help people who manifestly need help; we are talking about changing fundamentally the way in which most of the east of England farms, so it is not surprising that there are considerable concerns. I am certain that we have to take action, but I am less certain that the Government have a plan for helping the European Union to find a solution.

It is not only our own farmers who are affected. We do not want to give up our markets to countries that are better producers and in greater need, only to find that they are almost all taken by Australia and very large producers in Brazil. Countries such as Mozambique and Togo would lose the markets that they currently enjoy under preferential treatment. I do not pretend to have a simple answer but, if they are to be effective in the EU, the Government must present the House and the public with proposals for change in the EU. Only then will we begin to prepare our own people and the rest of Europe for the considerable alterations that are necessary.

Problems arise not just from the bad things in the EU but from good ones. I agree with the Secretary of State that we are loth to say how much has been done. We should acknowledge that even at Cancun the EU made a clear commitment to considerable reform. However, the United States was unable to make any such commitment. Some of my friends throw around the term "Atlanticist" as if it were opposed to "European", but the two concepts are necessarily part of the same proper view of the world. Good Atlanticists ought to be prepared to tell the United States, quite honourably, that its position on the Farm Bill is intolerable, intolerant and unacceptable. I was at Cancun when the Americans told the peoples of the world that there were reducing subsidies for its farmers—not existing subsidies, but those that would be in place after the Farm Bill was passed. The United States would still subsidise its farmers more than the European Union does its. In effect, that is asking the European Union to repeat what happened at the Uruguay round by doing considerably more than the United States, which means that some markets will go not to those whom we had hoped to help, but to the rich, subsidised producers of north America. That cannot be acceptable. The Government must speak out clearly—politely, of course—to say that that is not the basis for a development round and that we cannot recover Cancun until there is a real willingness on the part of the United States to move on the issue.

Mr. Hopkins

There are two components to the bad behaviour of the rich in relation to agricultural products: one part is to subsidise their own production for their own use, and the other is to export and dump surpluses on world markets at ridiculously low prices. Does the right hon. Gentleman agree that if we could get rid of dumping in the first instance, that might be a step forward?

Mr. Gummer

The two issues are intertwined. A country with heavily subsidised products does not need to use dumping techniques to undermine products that are not subsidised, even in home markets, as in the case of European-produced rapeseed oil that competes with coconut oil in the markets of west Africa. The two issues are so closely combined that they must be dealt with together.

The European Union has gone thus far but must go further. The Government must provide greater clarity on the next steps in the EU, which I hope will take place soon. The Secretary of State for Environment, Food and Rural Affairs has negotiated extremely effectively the results that have been achieved so far, and I pay tribute to her for that, but one effect of her reforms is that many British farmers will have to cope with significant reductions in their incomes. I say to the hon. Member for Ogmore (Huw Irranca-Davies) that the time for offensively attacking the common agricultural policy has passed. CAP reform will make it evident to many people in Britain just how tough the movement from subsidy to non-subsidy will be for agricultural areas. A great deal of explanation will be required by people such as hon. Members who are speaking in this debate and who, because we are committed to the developing countries and to the success of the European Union, are determined to make the necessary changes. During the 10 years of change, we will have to be there, on the front line, among the people who will be significantly disadvantaged.

Chris Bryant

Will the right hon. Gentleman give way?

Mr. Gummer

I shall carry on, because I should sit down in about two minutes.

The next issue to be addressed—I hope that it will be done carefully—is the way in which we deal with the governance of the countries that we seek to help. I agree with the Secretary of State's presentation of the Singapore issues. Our priority is to secure the changes that make the development round move forward, and if that blockage is so great, it is perhaps not worth fighting for those principles. Multilateral terms for carrying out investment are very important to developing countries in a world where the bilateral terms dictated by the United States or the European Union are often unfair. It may be better, although the developing nations may find it difficult, to have minimum arrangements of some kind—I hope that we can. If, however, we have to proceed without them, we must pay much more attention to the need for the benefits of freer trade and lower subsidies to reach the peoples of the developing countries instead of being stopped at the gates. That is where governance, the battle against corruption and the determination to ensure openness and transparency are important. I hope that the Minister will recognise that those issues are of huge importance if ordinary people in developing countries are to benefit from the changes.

My final point concerns fish. I am chairman of the Marine Stewardship Council, which seeks to ensure that fish production becomes sustainable. Tomorrow, we shall celebrate that cause at a gala that will be opened by the Prince of Wales. We are raising money to help poor communities to ensure that their fisheries are sustainable and thereby derive benefit from the markets in the rich world without destroying their own fish stocks. We need to recognise that the rich always win: if there is a shortage of something, the rich get what there is. In relation to fish, stocks of which have been increasingly depleted through pollution and, largely, greed, it is not the rich who go short, but the poor. The rich reach out ever further to buy other people's fish stocks, while the huge proportion of the world's poor who depend on fish for their protein will lose it in order that we have it in our shops.

Because it is Fairtrade fortnight, I suggest that we should add to fair trade the use of other mechanisms, of which the MSC is one, to remind people that when they buy products they should do it to the advantage, not disadvantage, of those who produce them. I hope that the Minister will use his position to bring considerable pressure to bear on the European Union to change its arrangements for agreeing fishery deals with poor countries in Africa. Many of those deals are not sufficiently policed, which allows rich nations to take more from the seas than is safe for next year's harvest. That situation could be improved if we in Britain were prepared to take such steps and to press the European Union to do likewise.

We are agreed on the essential need for urgent action, and the time has come for us to be honest about how difficult that action can be. Perhaps we can discuss it in a spirit of cross-party co-operation, unlike the Liberal party spokesman, the hon. Member for Carshalton and Wallington (Tom Brake), who spoiled the debate by seeking to find division. The real issues are very difficult, and it is in recognising that that vie should find the best kind of bipartisanship.

We need to move forward in a way that is not disruptive to the poor nations that lag behind the majority or to the rich nations, many of whose members are poor and have benefited from subsidies, and will need to be helped to move into the new world. I hope that the House will see this debate as the beginning of a rather different approach to the way in which we deal with the world's greatest problem: the ability to live together—rich and poor, north and south, European and American—in a world in which we increasingly have to act interdependently or perish.

2. 59 pm

Tony Baldry (Banbury) (Con)

The Select Committee on International Development has published two reports, which I commend to colleagues. One was published before and the other after Cancun. Both the Secretary of State for International Development and the Secretary of State for Trade and Industry gave evidence. We were also fortunate in having a debate in Westminster Hall and I do not intend to repeat its contents or those of the reports, which, I hope, colleagues will read.

I want to make three brief points. First, we shall not make progress if nations approach the matter as a mercantilist exercise. The other day, several members of the Select Committee met a trade Minister of a fellow European Union country. I shall not embarrass the country by naming the person, but we were discussing the Singapore issues and that Minister asked, "What are we going to get in return for making concessions on the Singapore issues?" When a mature, fellow EU state takes the purely mercantilist approach that if we take the Singapore issues off the table, the developing countries must make some concession in exchange, it makes one fear that we shall never make progress. As my hon. Friend the Member for Buckingham (Mr. Bercow) said, the world has to focus on how to make the Doha development round a proper development round, not simply on who can make the greatest gains and who can extract the greatest concessions.

Secondly, I do not believe that there is any disagreement in the House on the aspects of the second report that dealt with the common agricultural policy. The Select Committee comprises 11 members who represent the three main political parties and its report was unanimous. The Government's response to that post-Cancun report and the various boxes on agriculture shows that there is no disagreement. However, Commissioner Fischler's comments to the European Parliament Development Committee a few weeks ago show that there is clearly some difference between the House's view and that of Commissioner Fischler. He clearly feels that EU support that is anything other than direct agricultural support should not be included in the equation.

We must work out a way in which to engage with other Parliaments in Europe; otherwise, we shall continue to hold debates among ourselves and agree a view, but without influencing other Parliaments. I hope that the Conservative party will continue to remain engaged with centre-right parties, such as the Christian Democrats, in Europe because it gives us an opportunity to influence parliamentary colleagues in those parties. Many represent farming constituencies, and we need to engage them in discussions on the CAP. We must work out a way in which to do that.

We must also work out a way of engaging the United States Congress. How do we engage our fellow parliamentarians there? Sadly, few Members of Congress came to Cancun and it was not therefore possible to engage them in debate. Some nongovernmental organisations, such as the Catholic Fund for Overseas Development, have been trying to work with, for example, Roman Catholic Congressmen, but parliamentarians too must somehow work with Congressmen; otherwise we shall hold the debate only among ourselves. We need to reach out.

Thirdly, statistics show that wealth in developing countries is considerably enhanced if we improve the trade position. However, we must accept that even enhancing trade will not necessarily solve every developing country's problems. Last week, I was in Sierra Leone. The Secretary of State will be there next week for the opening of the special court. I visited a part of the country called Bonthe, which used to be a rice-exporting area, where previous Governments planted palm oil plantations. United Kingdom research into specific types of coconut led to coconut plantations being based there. The area also exported piassava, which goes into brooms. Its tragedy is that the country now imports rice, the palm oil plantations are going to rack and ruin and the piassava market has disappeared. Sierra Leone is now a net importer of foodstuffs. I therefore welcome the Government's consultation paper on aid to agriculture. The Secretary of State has heard me banging on about the subject, and I make no apology for doing that again.

It is good news that the Department has produced a consultation paper on what more can be done about aid to agriculture. I spent days in Bonthe examining the dereliction there. People there had become so poor and existed at such a subsistence level that they did not have the wherewithal to buy the machinery to start growing rice again. They had lost contact with the way in which to establish markets in Loughborough, where broom makers require piassava. They did not have the ability to work out how to get the technology to develop palm oil. That cannot necessarily be done by the state because, in the past, it has often led to corruption. However, those communities must somehow be helped, and not only by the World Trade Organisation, before they can even begin to think about exporting or gaining access to markets. They must first be able to feed themselves. It is a tragedy that the cost of rice in Freetown is higher than it has ever been. It is beyond the means of many people simply to buy rice.

Whatever we do here about trade justice is brilliant but more must be done to help the poorest countries in the world to attain the bottom level to enable them to trade at all.

3. 5 pm

Alistair Burt (North-East Bedfordshire) (Con)

I thank my hon. Friend the Member for Buckingham (r. Bercow) for tabling the motion. He builds on the excellent work of his two immediate predecessors, my hon. Friends the Members for South-West Devon (Mr. Streeter) and for Meriden (Mrs. Spelman), who over the years have built a sharp and compassionate platform for Conservative party policy on international development.

I want to make two brief points. First, although we concentrate on the opportunities that trade provides to help world development, I do not want to forget aid. Secondly, I want to reflect on the difficult issue of balancing market liberalisation with sensible interventionist policies to help trade grow in the countries that matter.

It is crucial not to forget the role that aid still has to play. The motion acknowledges the work of voluntary groups and I should like to thank those people throughout the country who support voluntary aid agencies around the world. They are often unsung, and, in some cases, give their lives to working in places around the globe t o make them better. They are a remarkable combination of people, who use their lives to help their neighbours, however far away. They have been political lobbyists, active on the streets and reflective in their writings, thus contributing to development theory as well as practice. They have engaged millions of others in their activities.

I pay particular tribute, because of my personal connections, to those who work in Christian-based aid organisations. Tearfund, CAFOD, World Vision and many others have made an extraordinary contribution. Sometimes it is necessary to be reminded of how dreadful conditions are in some places and the hurdles countries have to overcome before they even reach the world stage to discuss finance and trade.

My former researcher, Anthea, is now a regional officer for Tearfund in Burundi. Since 1993, that country has been engaged in a racially based civil war and hundreds of thousands of lives have been lost, yet the patient work of development goes on. Anthea e-mailed me yesterday She wrote: Burundians are in many ways similar to the British, it is difficult to get them to talk about the way they feel and it takes time to get to know them and to have any kind of real friendship. People never talk about the genocide, except as a historic event which they refer to as la crise' so the other day I was really surprised when …our logistics assistant told me what had happened in his family. In 1993 both his father and his brother were killed when all the male Tutsis in the commune where they lived were murdered. That year he said if you include his extended family fifty people were killed. It's hard to imagine how people deal with that kind of loss and yet one of the ways Burundian society seems to have tried to come to terms with the past is to bury it and never mention it; I In: genocide has become a taboo. God's healing is still very much needed before peace will become a reality. This month Tearfund are running two peace and reconciliation workshops, one in Bujumbura and one in Kirundo for church leaders. The aim is to encourage the church to play an integral role in the process of healing and reconciliation. Please pray that these workshops really inspire and excite church leaders and that they also go someway towards healing the rifts in the church. By contrast, Habitat for Humanity addresses the basic problem of poverty housing throughout the world. It is a non-profit-making, ecumenical Christian housing ministry, which aims to take poverty housing and homelessness from the world and make it an issue of raised consciousness. That organisation has built more than 150,000 homes and provided more than 750,000 people in 3,000 communities worldwide with decent, affordable shelter. I am proud to be an honorary UK patron of its work, along with Members from each of the major parties. It is a model of sensible international development. It encourages local leadership to get on board, it uses local materials and it helps people, by engaging them in what it calls "sweat equity", to gain access to affordable housing ownership in their communities. That is an example of how Christian scripture can act as a basis for professional community development, effective delivery systems and practical action in the community.

The basic capacity building of homes and the provision of peace and reconciliation in conflict-torn areas are absolutely essential before we even consider how nations can then tackle the international crises that we seek to address through trade, and through negotiation and discussion on such matters as finance. On the reform of trade rules, I sign up unequivocally to the general view that freer trade is likely to be better for people. On balance, that is the way in which the world has worked and progressed, and there is plenty of evidence of how trade regimes that are too restrictive can cause damage. However, on the wider issue of how far that free trade is to go, the evidence suggests that the jury is still out and that there are serious differences between major players, which need to be resolved. Strong, persistent voices from those in a position to know seem to be raised determinedly against the substantial extension of unprotected, unmoderated free trade.

Mr. Hopkins

I am interested in what the hon. Gentleman is saying. Is he aware that Joseph Stiglitz, formerly of the World Trade Organisation and a Nobel prize winner, has expressed severe doubts about trade liberalisation and WTO policies?

Alistair Burt

I think that we are in the same general area of discussion, and I am happy to develop this point for a couple more minutes.

I raise this point because it is a matter of concern for the world's poor, and for those of us who seek to understand their position and to intervene and speak for them—that there appear to be strong differences of opinion among international financial institutions such as the World Bank and the International Monetary Fund, organisations such as the WTO, individual Governments and, by contrast, the voices of certain development agencies.

As an example, Focus on the Global South, a regional organisation for policy research, analysis and action, which works in conjunction with the United Nations in Asia and the Pacific, produced a report in October 2003, entitled "Anti poverty or anti poor? The millennium development goals and the eradication of extreme poverty and hunger". It was critical of the World Bank, and quoted a study on structural adjustment programmes and their effects on countries across Latin America, Africa and Asia. That study found, among other things, that indiscriminate trade and financial sector liberalisation devastated local industry, especially the small and medium-sized enterprises that provided the bulk of national employment; that such trade and liberalisation undermined the viability of small farms and agricultural producers, which weakened food security and damaged the national environment; and that macro-level problems have accompanied those local-level failures, which means that the promised gains of efficiency, competition savings and revenues have not materialised.

World Vision, in a paper that it prepared for me for this debate, says that there are significant dangers for developing countries in having their policy options foreclosed by IMF and World Bank loans, conditionalities and inappropriate, restrictive WTO rules. It might be reasonable to assume that some who work for development agencies are not by nature well disposed toward liberal, free market economics, and they sometimes show a touching faith in state production and institutions of whose effectiveness and success there is scant evidence. However, I find that there are too many well researched, well written papers coming from people on the ground, who ought to know what is happening in practice and what the effects of various measures are, for them to be too easily dismissed.

I ask my own Front Bench, the Secretary of State and the Minister for Small Business and Enterprise, who is replying to the debate, how we stand on that. Do the Government feel that the conflicts between the agencies and some financial institutions on the extension of free trade can be easily overcome? Is synthesis possible? Do the Government come down on one side of the line or the other?

The very nature of the debate troubles our constituents, who want to believe what politicians tell them on this matter, but sometimes find politicians' views diametrically opposed by the churches and voluntary agencies that they wish to support, and to which they give their money and time. To put the question simply, is there a way through? Is there a synthesis of opinion, and can the difficulties that the agencies have raised, and the conflict over some free trade issues, be reconciled? I hope that I am not alone in being puzzled by that, on behalf of those who are interested in the matter. In the spirit of debate, I should genuinely be interested to find an answer.

In conclusion, I think our constituents will be well pleased to find that on occasion, we speak collectively with one voice—on an issue. On this issue, the day for which our constituents are waiting is the day on which, collectively, we can deliver.

3. 15 pm

Mr. Robert Walter (North Dorset) (Con)

I should like to join other colleagues in congratulating my hon. Friend the Member for Buckingham (Mr. Bercow) on introducing this debate on fair trade. Following what the hon. Member for Ogmore (Huw Irranca-Davies) said, I can tell the House that my hon. Friend the Member for Buckingham will be joining me for a Fairtrade tea in my constituency in a week or so.

I had the honour to serve on the Select Committee on International Development for two years, under the chairmanship of my hon. Friend the Member for Banbury (Tony Baldry). Some former colleagues are present today. I served on that Committee until just before Christmas, and we produced two reports on trade and the issues surrounding the World Trade Organisation and the abortive Cancun summit. I found that preparing those reports was fascinating, if sometimes depressing. During our year of inquiry, we visited the WTO, the European Commission and the European Parliament. We took evidence in Washington from trade representatives and representatives of the Department of Agriculture, and we heard evidence from many developing countries, as well as countless NGOs.

One point that has become clear to me from those deliberations is that Europe and the United States hold the key to the solution of this issue. Europe and the United States appear to pay lip service to that solution, but neither is prepared to undertake the reforms necessary to bring it about. The trade and agricultural policies on either side of the Atlantic ocean are blocking real progress. We heard numerous examples of that, highlighted in the report to which my hon. Friend the Member for Banbury referred: the inability of Indian dairy farmers to compete with subsidised European skimmed milk exports to the Middle East; the damage caused to the Jamaican dairy sector by the dumping of skimmed milk powder by the European Union; and the problems in the sugar industry and the cotton sector, to which my hon. Friend the Member for Buckingham and others have referred.

I was particularly struck by the remarks of the Prime Minister of Ethiopia, in his evidence to the Committee, about the inability of Ethiopian producers to compete with subsidised US corn exports to Yemen, which is the Ethiopians' traditional market. He was cautious, although I tried to prompt him, about calling that "dumping", but we all knew what he meant. European leaders seem to have been rather pleased with themselves during the past year over their agreement to the reform of the common agricultural policy. However, that will not tackle directly the problems related to export subsidies, and it will fall far short of stopping the dumping of European Union surpluses.

Agriculture is the key to fairer trade in both the developed and the developing world. Although it is by far and away the most distorted sector, agriculture is the most important issue for developing countries. As I hinted in my intervention on the Secretary of State, I take issue with the element of generosity and common purpose in the opening remarks of my hon. Friend the Member for Buckingham to the Secretary of State. In the motion, my party urges the Government both to press for the talks to restart and to publish its proposals for the reform of agricultural subsidies", whereas the Prime Minister's amendment refers only to urging the European Union to make further progress on reforming the Common Agriculture Policy regimes for cotton, sugar, tobacco and olive oil". We have to go much further than that.

In the Committee's report, we pointed out that three quarters of the world's poor live in rural areas, that 27 per cent. of developing countries' gross domestic product and export earnings comes from agriculture, and that agriculture provides 50 per cent. of employment in those countries. Its importance in the poorest countries is even greater, because it provides employment for more than 60 per cent. of the labour force and represents some 70 per cent. of their exports. The World Bank estimates that up to 70 per cent. of the gains from trade liberalisation would come from the agricultural sector, which could increase developing countries' exports by anything from $30 billion to $100 billion a year. Our report suggests that that could add an extra 1 per cent. to the GDP of Africa.

So, removing subsidies, ending dumping and reducing barriers to trade will put an end to what one of the witnesses before the Select Committee described as a catalogue of scandalous destruction of livelihoods or missed trade opportunities for developing countries".

Chris Bryant

It has been clear throughout this debate that everyone shares the hon. Gentleman's desire for change in the common agricultural policy. However, elections are coming up in Spain and Greece in the next few weeks, and both those countries are likely to return Governments with a renewed mandate for keeping—and, indeed, enhancing—the common agricultural policy. How are we to set about the political process of achieving further reform?

Mr. Walter

I agree, to some extent, with the frustration that underlies the hon. Gentleman's question. This is one of the reasons why we must be firm in our united resolve, on both sides of the House, to get the point across to all our European partners that this situation cannot go on. I shall develop that argument just a little more, if I may.

This is not just about export subsidies. The United States and the European Union have to deliver wholesale cuts on domestic subsidies as well. I do not believe that the CAP reform that has been negotiated will deliver any such change in this subsidy-dependent culture. I have been a farmer, and I have enjoyed the subsidy regime. It distorts every business decision. People used to ask me what I farmed, and I would reply, rather light-heartedly, that I farmed subsidies and kept sheep to justify them.

I take issue slightly with my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), in that I believe that British farmers would love to see the back of the subsidy-dependent culture that exists right across Europe. However, it is not the British farmers in my constituency who are defending the indefensible. Many of my constituents would not be prepared to give up their subsidies until their European and American cousins had done the same thing, and if I were still farming, I would feel the same. However, we have to work in a concerted way to achieve that. Any British farmer will tell us that the current system of land-use subsidies, production subsidies, export subsidies, dumping and barriers leads to us all here in the north producing far more than the market demands.

I should like to say a few words about the reform of the common agricultural policy, because Commissioner Fischler has been referred to briefly. I shall quote from a report by the US Department of Agriculture economic research service, which concluded that US subsidies increase the level of output, even though they are meant to be production-neutral. The report states: Transfers that are not commodity specific can increase the overall level of agricultural production by increasing the wealth (financial well-being) of farmers, thereby expanding agricultural investment and boosting the use of land and other inputs.

Mr. Bercow

My hon. Friend is making a characteristically thoughtful speech. Does he not agree that the single most shocking feature of agricultural policy in the United States is that the Farm Act 2002 represents a serious regression from the position established in the 1996 Act?

Mr. Walter

I agree absolutely.

I was about to quote from Agra Europe, a well-known research body on this side of the Atlantic, which reported: Overall, the new legislation is expected to increase spending on US farm support by an additional 70 per cent. or $73 billion, over the next ten years. Its specific criticisms of those subsidies were as follows. They guarantee the US farmer a given level of income… Lower prices will mean that farmers gain a higher income than they would if market prices were higher—thus sustaining market disequilibrium… Since guaranteed income means guaranteed return on everything grown irrespective of whether it is sold, and Resulting increased production will flood the market and further drive down prices". Those new subsidies will reduce US export prices, particularly for wheat, which already forms 40 per cent. of the world's total production. That will have a depressing effect on third world prices and reduce the attractiveness of US domestic markets to developing country exporters.

In 2002, total agricultural support in OECD countries amounted to the equivalent of 1. 2 per cent. of GDP—more than $300 billion—which meant that prices were on average about 31 per cent. above world prices. In the European Union, export subsidies are explicit. In the USA, they are not always quite so clear and straightforward. None the less, they are as great, if not greater. Our Committee reported that the average external agricultural tariff around Europe is 19 per cent., and reaches a peak of 260 per cent. The average external tariff around the United States is 5 per cent., reaching a peak of 350 per cent. We are dealing here with export barriers and subsidies, import tariffs and the overall level of subsidy.

I leave the House with a simple question. If I were a washing machine manufacturer, and each year the European Commission shared out up to €50 billion among all the washing machine manufactures, just to keep the factories going and for the privilege of telling all my friends that I was a washing machine manufacturer, I imagine that some of the other washing machine manufacturers in the world might get a little upset. They might use terms such as "unfair competition", or get their Governments to impose tariffs or block our washing machine exports. I guess they would. But that is exactly what we are doing in just one sector today—the agriculture sector—and the reforms we have agreed make little difference. They do not alter the basic equation. NV', in Europe—this is replicated in the United States—are giving our farmers nearly €50 billion a year, which is not available to our competitors. That is simply not fair.

3. 28 pm

Mr. Quentin Davies (Grantham and Stamford) (Con)

The consensus that has emerged this afternoon, both in the remarks from those on the two Front Benches and in the motion and the amendment, is rather striking. It is also valuable. I suspect that the Government tabled their amendment because, like many of us, they had an automatic, instinctive partisan reaction, and felt that they ought to say something of their own in the form of a counterblast. I hope, however, that on reflection they will not divide the House. Such a decision would be a positive gesture because we can achieve more on CAP reform if there is a consensus.

The emphasis of my remarks will differ slightly from that of some of my colleagues, although we all share the objectives involved. Human history teaches us unambiguously that international trade is a prerequisite for growth in output and wealth and for the reduction of poverty. The enormous and, at the time, unprecedented expansion of output and wealth in the 19th century was associated with the even faster growth rate of trade. When that rate began to be reduced at the end of the 19th century by protectionist measures from the continent and from the United States, the output growth rate began to fall.

In the inter-war period, protectionism was unprecedented, at least since the 17th century, and enormous trade barriers were raised, beginning with the appalling Smoot-Hawley tariffs in the United States in the early '20s. During those 20 years, we had the most disappointing growth rates, and in the 1930s a memorable and appalling recession. Over the last 50 years, the enormous increase in wealth and well-being has been associated with an international trade growth rate many points higher than the output growth rate. That could not have been achieved without the liberalisation measures and, in particular, the creation of the European Union, as well as the international measures that started with the Kennedy round in the `60s, moving through the general agreement on tariffs and trade and now the Doha process.

Against that background, Cancun is disappointing. At the very least, it is a serious reverse in a favourable process and we are all right to be concerned about that. When it comes to drawing lessons, we must—at the same time and by the same token—assign blame. The most popular target seems to be the EU. A lot of people in this country, for the noblest motives, like to feel that they are being more critical of themselves than of other people. Perhaps that is a good principle in one's private life, but it can sometimes lead one astray in one's political judgments.

In Cancun, the EU made a considerable effort, which was the decision to go for decoupling last year. It involved considerable sacrifice by many politicians who depend on the farming vote. I am not always nice to the French in this Chamber, but let me say that it was positive, and rather unexpected, that the French went along with that, so they deserve credit.

What is more, when we got to Cancun Commissioner Lamy made a number of major concessions. He gave away two of the Singapore points—those on investment and on competition. Both are sensible proposals that are much in the interests of the developing countries; I shall come to that in a moment. Nevertheless, operating tactically while also showing good will and emphasising the importance of the whole issue, he gave way.

The Americans did nothing at all. They had done nothing beforehand to prepare for success and, so far as I can see, they did nothing when they got to Cancun to contribute to success. Their Farm Act 2002, which has been referred to several times this afternoon, was a complete disaster, as it went in the opposite direction and increased agriculture support when the EU was at least reducing ours. That was most extraordinary.

The Americans' record in trade matters recently has been really dreadful. The sudden, arbitrary imposition of steel quotas and the tax subsidies for exporters, which are causing a trade war between us and the United States and which are a serious matter, flowed from entirely selfish, short-sighted and lobby-driven pressures on the US Administration. In so many other ways, I greatly respect and greatly support them because—other colleagues have referred to this—I am a strong Atlanticist as well as a strong and, I hope, good European.

We have to try to consider things as dispassionately as we can in this matter, but the United States does not come out of it with any credit at all. It will not help the argument at all, nor will it help our relations with the United States, if we are anything less than frank with it about that, as I would expect, among friends and allies, the US to be with us if it had a similar problem.

Mr. Hopkins

rose—

Mr. Davies

Because of time pressure, I hope that the hon. Gentleman will forgive me for not giving way.

We cannot end the indictment there. I am about to say something that has not been said and I may be clashing with a consensus that I value, for which I apologise in advance. I have to say that the position taken up by the G90 at Cancun was irrational and very unhelpful. It is not sensible, as the Trade Justice Movement seems to believe, that the slogan should be, "Open up your markets, do whatever the G90 asks for and let them get on with governing their own countries in whatever way they want. " That is not a realistic line to take.

Even if we could persuade all our EU colleagues to go along with an entirely altruistic policy of making unilateral concessions without demanding anything in return, we would not persuade everyone else in the world who needs to be part of an agreement—the Japanese and the South Koreans, for example, who took a strong line on the Singapore issues at Cancun— to come along on that basis, nor would it be reasonable to expect them to do so. Human affairs are not normally conducted in such a way, so that is bad advice to give anybody. I would be sorry if it were the message that went out from the House this afternoon.

I also have to say that it is irresponsible of us not to take an opportunity that offers to assist in the cause of good governance and rational economic policies among those poor countries whose poverty we are desperately trying to alleviate. In life, we cannot help people who will not help themselves. We all know that if 50 countries have gone backwards and become poorer in the last 20 years—that is a quarter of the countries in the world, which is an appalling statistic—that is largely because of the policies that they have adopted.

There are classic, egregious examples of appallingly destructive economic policies, sometimes based on a lot of cloudy rhetoric about socialism, fairness and so forth, that ruined a country—Ghana under Nkrumah and Tanzania under Nyerere are the two classic examples. Perhaps I will not be quite so blunt about people who are still in power, but there are too many of them around, particularly in Africa. They are a major problem.

With the best will in the world, I believe that we have made all the trade concessions that we want and we provide all the aid and all the development assistance that we want. We are providing $50 billion at the moment, although I know that that is not much. All that can be discounted and made as nothing by self-destructive economic policies adopted by the beneficiary—the recipient—states. So, it is absolutely right, if we are to make this effort, that we should do so alongside the countries that we hope will benefit—on a partnership basis, of course.

We should indeed seek to exert subtle but effective leverage on the policies of those countries and try to ensure that when we are in a position to give them something that they want we use that opportunity. That is quite normal in human affairs, and is not in any sense a humiliating policy to adopt. We should seek to influence them to tat e a sensible and rational direction. That would be very much in the interest of the world as a whole, but particularly in the interest of their own populations, who are suffering from too much poverty.

For all those reasons, the G90 should not escape its fair share of the blame for what happened. We should be just as blunt and just as frank with those countries, nor should we patronise them by treating them any differently from normal, adult, responsible human beings with whom we deal in life, politics, business or any other context. We should speak clearly, saying, "We want to help you. We believe that we can and there will be a great effort on our part to remove some of the subsidies, although there will be a political cost. We want to talk through what you can do. We will end up with a blueprint for a batter world. " That is the dialogue that we should be having.

I have a final point to make. Somebody else should not escape a mention in the debate and a measure of the blame—Senor Luis Ernesto Derbez, the appalling chairman at Cancun, who behaved with an unbelievable lack of imagination, flexibility and competence in chairing a complicated international meeting.

It was crazy to think that there was any chance of reaching agreement in five days. To close the whole show then—just a few hours after a critical concession had been made by Commissioner Lamy and before anyone had the chance to digest it and work out where we might go from there—was quite extraordinary. I have no idea why the chairman did that, but of course it was a completely mistaken tactical approach. He should have allowed that concession to be absorbed and seen whether some people would come back with some more.

There is no question but that the problems that we have to deal with in this matter are far too important and far too complex for it to be responsibly expected that they can be dealt with definitively within five days; a great deal longer way necessary. When we get back to business on this one, which I hope we will as soon as possible after the American presidential election, I hope that all those lessons, and indeed many others, will be effectively learned.

3. 38 pm

John Barrett (Edinburgh, West) (LD)

There is clearly consensus on both sides of the House about the vast majority of issues that have been discussed this afternoon. The Government have made much progress, but while the hon. Member for Buckingham (Mr. Bercow) made the most eloquent speech, the Secretary of State was right to raise the Conservatives' track record. The best indication of future performance is past performance—that cannot be airbrushed out of history.

There is consensus in this place. but the public are mystified. because all that they ask is that we politicians give the poorest, the hungriest and the starving a decent trading system, so that they have a level playing field and can get a leg up and participate in trade. Trade with developing countries is occurring, and not just in agricultural products, although they are clearly the No. I issue. There is trade in mining, a growing trade in tourism, trade in arms, as my hon. Friend the Member for Carshalton and Wallington (Torn Brake) mentioned, and trade in technology. One thing that has affected my constituency is the trade in financial services jobs, which are going to the developing world.

Unfair barriers must be tackled Non-tariff barriers make it difficult for products from the developing world to enter our market. It is right that we have high standards, and that we demand that the food that ends up on the supermarket shelf is of the highest standard. The knock-on effect of that, however, is that people who want to enter the food market must comply with the same standards. If we are to help the developing world, we must therefore assist those developing countries in a number of ways to enter our markets.

The effect of trade on the environment has not been mentioned. If we trade with the developing world in timber, for instance, we must consider the effect that that has on the environment and on greenhouse gases. Clearly, there is not enough time to discuss many aspects of trade, although they have been discussed in the Chamber and in Westminster Hall a few times recently. I appreciate that the Secretary of State has always shown a great interest and has turned up for those debates.

I have mentioned the national issues, but it is also worth mentioning and recognising local initiatives that are helping. When the Minister replies, he may mention the fair trade policy of Edinburgh university, in his constituency. Our city of Edinburgh has adopted fair trade city status. Fair trade bananas are now on display in my local Tesco, and at a village in my constituency, South Queensferry, people are signing up to participate in fair trade.

The issue is trade justice, and a number of Members have already mentioned the injustice of EU farm subsidies and the United States Farm Bill. Europe and the United States are part of the problem, not part of the solution. I would like to see some movement on that, and given the special relationship that exists, or is supposed to exist, between the Prime Minister and the US President, it could be emphasised how important it is that they roll back some of the subsidies that they are giving their domestic producers and their exporters, which are effectively destroying markets.

Aid and trade are also linked. As the Chairman of the Select Committee, the hon. Member for Banbury (Tony Baldry), has pointed out in the past, we must accept that in good years, when developing countries are producing a great deal of whatever agricultural product they produce, the price falls, whereas in bad years of agricultural production, we send out more aid and, once again, there is a danger that local market prices can be undermined. We must make sure that we integrate our aid and develop trade at the same time.

A classic example of things having gone completely pear-shaped is the world coffee market. The Secretary of State and others mentioned the problems of Ethiopia. If Ethiopia is to move forward, with its growing population and huge AIDS crisis, it must develop irrigation, agricultural production, its road system and its education and health systems, all of which will work together in letting it develop as a nation and develop its trade. Coffee production is at the heart of Ethiopia's future potential. While there are new players in the market, such as Vietnam, which was mentioned earlier, one of the problems is that we are paying increased prices for coffee on our supermarket shelves, yet the world coffee price to the local farmer is dropping. On a rough calculation, a coffee farmer must produce enough coffee for 1,000 cups of coffee to be paid as much as we in the UK pay for one cup of coffee.

As time is moving on, I want to end with what I said when we last discussed this subject: Trade agreements should be developed to help the poor, to protect the environment and to be a force for positive change. If that development does not take place, we shall all suffer as we help to develop a world where the obese watch the poor starve to death on television. All that is being asked for is what is fair. We should settle for nothing else. "—[Official Report, 19 June 2002; Vol. 387, c. 315.]

3. 45 pm

Ann McKechin (Glasgow, Maryhill) (Lab)

I welcome this debate, which is timely. I add my support for Fairtrade fortnight. I will support one or two fair trade shops in my constituency on Friday.

I had the privilege to attend last year's WTO summit in Cancun. I want to comment on some of my observations at the conference. First, we need to stop playing the poker game when we arrive at conferences by leaving every decision to be dealt with in four days flat. The capacity of someone from a poor developing country to be able to deal with the wide-ranging and complex issues within such a short period is virtually nil. It would be of great assistance if all nations could concentrate on reaching the majority of decisions in Geneva during the course of the year in normal negotiations rather than leaving everything to the last minute.

Language is also important, particularly within the European Union. I heard the French Trade Minister talk about the unique cultural quality of his agriculture and how he wanted to refer it to UNESCO. I heard the Italian Trade Minister talk about the unique value of Italian soil. Considering that his audience consisted of Trade Ministers from some of the poorest countries in the world, where 70 to 85 per cent. of the population are involved in subsistence farming, that must have been fairly hard to swallow. The first thing that we could therefore do is to talk about development and truly mean what we say. I give credit to the British Minister who, in complete contrast, emphasised the need for true development and the need of the poorest countries. The United States of America was not even present—despite having more than 250 people in its delegation, one would have been hard-pressed to find them in Cancun, for they spent most of their time hiding away, considering the embarrassment of having to speak to Ministers and others representing farmers in west Africa and cotton farmers who are now facing bankruptcy because of the failure of the Cancun talks.

We also need to differentiate the needs of the G21 group, comprising countries such as India, China and Brazil, which are looking for more access to our markets, and those of the G90, which need more time spent on special and differential treatment as opposed simply to reducing barriers. Different needs exist, and we must find an agreement that will suit both sets of views and needs.

The Singapore issues have been mentioned. Pascal Lamy left it far too late in the game to make his offer, which was one of the major problems with the Cancun debate. Trade rules are not necessarily a good basis on which to establish an investment agreement. There are different nuances, which require differentiation, not a one-size-fits-all approach. We should remember that the policies of the World Bank and International Monetary Fund already require developing countries to liberalise without any trade-off. When developing countries attend the WTO, therefore, they have already liberalised many of their markets as a result of World Bank and IMF policies, and have little to offer and negotiate with at the table. It is no wonder that developing countries feel so defensive when attending conferences of this kind.

We need World Bank, IMF and WTO policies that recognise the fact that countries such as India and China protected their own markets before agreeing to trade liberalisation. They developed their domestic industries before allowing them to be left to the open market. We must consider how the various agencies can best work together to achieve the millennium development goals and economic growth in the world's poorest countries.

The International Labour Organisation recently held a special commission on globalisation. One of its best recommendations was that we should concentrate not on freer regulation but on actual employment growth. That should be the test of whether we are achieving a reduction in absolute poverty.

I hope that the Government will consider those points, and that they will form part of our discussions on progress and trade agreements in the coming year.

3. 49 pm

Mr. James Arbuthnot (North-East Hampshire) (Con)

This moving and rather unusual debate has featured the House at its best—with the exception, I am sorry to say, of one speech fairly near the beginning. Although it is a shame that there were only two Labour Back-Bench speeches, we have seen the House united on a subject, and in its language on that subject. The value of that lies in the fact that, as my hon. Friend the Member for Buckingham (Mr. Bercow) pointed out, this is one of the world's crucial issues, which affects the living or dying of millions of people.

I congratulate the Government on the non-partisan nature of both the Secretary of State's speech and his amendment. I have no quarrel with the amendment; my only question to the Secretary of State is whether he disagrees with anything in the motion. I heard nothing in his speech that suggested that he did. I think he agrees with the motion but would have worded it slightly differently himself. In his opening remarks, he invited the House to unite in support of the amendment. I do not think we shall have an opportunity to do so, because the Conservatives will not oppose it. Indeed, that will arise only if the Secretary of State takes the step of voting down our motion—with which he agrees, so I hope he will not. My right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) said, in an extremely powerful speech, that this debate would provide an opportunity for a good deal of consensus. It can still provide that opportunity.

As I have said, I accept the amendment, but there are points on which we need more detail. The Secretary of State urges the European Union to make further progress on reforming the Common Agriculture Policy regimes". Of course we all do, but what is he doing to achieve that further progress? My right hon. Friend the Member for Suffolk, Coastal said that it was not clear to him that the Government had a plan to help the European Union make such progress, and it was not clear to me, either, from the Secretary of State's speech, welcome though it was.

The amendment calls for action on HIV/AIDS. Yes, but once we have called for that action, what will we do to achieve something for those desperately poor countries? It calls for a successful Doha round. Of course, but the prospects do not look good at present. The Doha round is intended to finish by January next year, but given the way things are going, that will not happen. The Secretary of State referred to the millennium development goals. He said that there were targets to be achieved by 2015, and that we would be judged on them. That is right, but if we cannot even achieve a successful development round at Doha, how are we to achieve those goals by 2015? The hon. Member for Glasgow, Maryhill (Ann McKechin) made a similar point.

The amendment says that significant progress must be made to improve access for developing country exports". But, as my right hon. Friend the Member for Suffolk, Coastal said, such things are very difficult to achieve, so we need some mechanisms through which such progress can be made. Let us consider the question of substantial reductions in trade-distorting agricultural subsidies. In a very well informed speech—as always—my hon. Friend the Member for North Dorset (Mr. Walter) said that he farms subsidies and keeps sheep to justify them. What are we actually going to do to achieve these substantial reductions in trade-distorting subsidies?

I therefore accept the Government's amendment; all I suggest is that when the opportunity comes to oppose our motion, they fail to take it.

Before I finish, I want briefly to discuss the Singapore issues. I welcomed what the Secretary of State said—

Mr. John Taylor (Solihull) (Con)

Before my right hon. Friend moves on. may I draw his attention to the compelling speech of my hon. Friend the Member for Grantham and Stamford (Mr. Davies), who seeks mechanisms that can couple the aid given to countries that deserve it with stewardship of how it is spent, the economic consequences of the use of that aid, and its effectiveness and efficiency?

Mr. Arbuthnot

If one is allowed to refer to Lord Copper in this Chamber, I would say, "Up to a point". My hon. Friend the Member for Grantham and Stamford (Mr. Davies) made a characteristically trenchant speech about the Singapore issues with which I entirely agreed. He rightly said—as, indeed, did the Secretary of State—that those issues have considerable value. There is value in reducing corruption in developing countries, and in improving free trade and public procurement. That is all to the good. We need to pursue those issues, and it is important that we do so for the developing countries themselves. But as the Secretary of State and my hon. Friend the Member for Banbury (Tony Baldry) said—I thank him, incidentally, not only for an outstanding speech but for his outstanding Select Committee work and the skill that he brings to it—that should not be done at the expense of more important and urgent issues relating to the Doha round. That is particularly true of agriculture. As the Secretary of State said, the Singapore issues should not themselves stand in the way of the Doha round, however important they are.

Free trade is sometimes said to be in contradiction with the principle of fair trade, but both freedom and fairness are crucial values in trade, as in all other things. They must be balanced, but the trouble is that all too often, in trade as in other things, we have neither freedom nor fairness. The richest countries—the United States and the countries of the European Union—subsidise and protect their markets. Fairness is of course very important for rich countries, but for developing countries it is more than important: it is a matter of life and death—not just for individual people but for whole communities.

I should like to draw particular attention to the moving speech of my hon. Friend the Member for North-East Bedfordshire (Alistair Burt), who discussed issues relating to Burundi. Freedom to trade is likewise more important to developing countries than to rich countries. Protectionism is not the answer, but it is particularly not the answer to protect rich countries, especially the United States and those of the European Union. Many of us have detected in the Democratic primaries worrying signs of protectionism arising as a positive issue in the United States election, and worrying signs of US behaviour in respect of steel tariffs. I am delighted that the US has now removed them, but I suspect that that was done more out of self-interest than anything else.

Protectionism in the United States or in the European Union will not help the billion people in the world who live on less than a dollar a day, or the billion people in the world who have inadequate drinking water. We have the opportunity today to send out a message that this House is united in its determination to help those people and to change the world with real answers. Let us take that opportunity.

3. 59 pm

The Parliamentary Under-Secretary of State for Trade and Industry(Nigel Griffiths)

This debate shows the House at its best, with thoughtful points, searching questions and helpful suggestions. I am sorry that I was briefly absent from the Chamber when the hon. Member for Carshalton and Wallington (Tom Brake) spoke, but I have notes from my right hon. Friend the Secretary of State. Doubtless the debate will get no media coverage because of that consensus.

I want to pay tribute to Baroness Chalker of Wallasey, who has greatly enriched these debates and was most respected in this House and outside. Twenty years ago, with my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz), Alistair Grimes and Alan Sinclair, I was one of the founder members in Edinburgh of Scottish Education and Action for Development, one of the first fair trade organisations in the United Kingdom. I began a journey for justice in developed countries and the elimination of poverty, a journey that will end only when there are no more starving children, no children who do not go to school and no children who cannot get fresh water.

I am pleased that the Department of Trade and Industry stocks fair trade items, including coffee, tea, chocolate and bananas. I hope that the House of Commons will consider following in our footsteps. At the launch of Fairtrade fortnight on Monday—the tenth anniversary of the Fairtrade Foundation—I was pleased that the Government were able to support the fortnight with almost £1 million to continue the work of ensuring that we have trade justice. I am delighted that the Co-op is doubling the stocking and sale of its own-brand fair trade items; it is showing a great lead. Finally, I am particularly grateful to my constituent Anne Howard for allowing me to help launch Fairtrade fortnight in St. Columba's church in Newington a short time ago.

It is clear from today's debate that there are many well informed and keenly interested Members. I was grateful for the contribution from the hon. Member for Carshalton and Wallington, who asked quite rightly about the international finance facility. My right hon. Friend the Chancellor and other leading members of the leading world economies are taking a close interest in the World Bank and IMF spring meetings, which will cover the issue. The hon. Gentleman also mentioned the boundary commission report on Ethiopia; the Government's position is that this should be implemented fully.

In an intervention, the hon. Member for Banbury (Tony Baldry), the distinguished Chairman of the Select Committee, gave strong support for the commission for Africa. The Prime Minister is on record about the steps that we need to take to prevent small arms sales to Africa. The hon. Gentleman also stressed the need to engage other Parliaments, particularly in Europe—a point echoed by other hon. Members—as well as the need to engage the United States of America. The hon. Member for North Dorset (Mr. Walter) spoke of his involvement in engaging the United States. It is important that the international nature of the issue is taken on board.

The right hon. Member for Suffolk, Coastal (Mr. Gummer) made a thoughtful speech and I pay tribute to his work as chairman of the Marine Stewardship Council. He spoke of the pressing need to ensure that the EU agreements on fisheries are fair and equitable to the countries of Africa and do not become yet another opportunity for despoiling the sea stocks. I welcome the right hon. Gentleman's support for the outstanding work on the issue that was done at the end of last year in Cancun.

The hon. Member for North-East Bedfordshire (Alistair Burt) also spoke with great knowledge about the need to reconcile what should not be contradictory aims of aid agencies and financial institutions. He will know that my right hon. Friend the Secretary of State meets all the large aid agencies regularly, and that we stress the appreciation, shared by everyone in Britain, of the £70 billion of debt relief that the heavily indebted poor countries have benefited from, thanks to both political intervention and the intervention of financial institutions.

My hon. Friend the Member for Ogmore (Huw Irranca-Davies) spoke of one of the critical needs, which is to develop the voice of poorer and developing nations. He will share my gratitude to my right hon. Friend for ensuring that £160 million is going into capacity building, building the knowledge base, I hope from within, so that those nations are in a good position to enter the negotiating chamber well armed with the facts and with the 21st century skills that are equally needed to negotiate a fair settlement on their behalf. This is an important issue.

The hon. Member for North Dorset stressed a theme common to all speakers, but did it particularly eloquently, in demanding reforms to the common agricultural policy. Those who were not able to be present today would do well to read the Official Report of the proceedings, including the very thoughtful and challenging comments about the British agricultural position and the realities that we have to face. If all politics were as straightforward and honest with regard to difficult issues, we would all be the better.

The hon. Member for Grantham and Stamford (Mr. Davies) stated something that we all accept: our disappointment with Cancun. He made some challenging and critical remarks about the G90 nations. Of course, their expectations must be tailored to the realities, but we cannot expect them to move without the European Union, the United States of America and other advanced economies moving as well.

I was grateful to the hon. Member for Edinburgh, West (John Barrett) for showcasing Edinburgh and what the university, the council, and church and faith groups in our city do. I am also grateful to my hon. Friend the Member for Glasgow, Maryhill (Ann McKechin) for her thoughtful contribution.

In winding up for the Opposition, the right hon. Member for North-East Hampshire (Mr. Arbuthnot) made a number of points and put a number of fair questions. He stressed the details needed on how we are intervening with the CAP. Clearly, we want to build on our good record on textile reform, which has been very beneficial to developing countries in showing that it is possible to ensure that trade is much fairer and much better at boosting their economies.

Flowers from Kenya are a great market, having reached £35 million from almost nothing in a few short years, because we allow those flowers into the European Union. We must both appeal to consumers and have a good and sensible approach to the agricultural sector. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs announced such an approach in January and is proceeding with it.

We are all concerned about HIV/AIDS, and I know the right hon. Gentleman for North-East Hampshire will share my congratulations to my right hon. Friends for increasing our spending in that regard sevenfold.

With regard to Doha, the right hon. Gentleman and his colleagues will want to work with us to put forward a sensible agenda to secure a result that benefits everyone.

It has been a pleasure and a privilege to take part in the debate. I thank all hon. Members for their valuable contributions and the spirit in which the debate took place. Would that all our proceedings were the same.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 200, Noes 326.

Division No. 72]	[4:09 pm
AYES
Ainsworth, Peter (E Surrey)	Chapman, Sir Sydney (Chipping
Amess, David	Barnet)
Ancram, rh Michael	Chope, Christopher
Arbuthnot, rh James	Clappison, James
Bacon, Richard	Clarke, rh Kenneth (Rushcliffe)
Baker, Norman	Clifton-Brown, Geoffrey
Baldry, Tony	Collins, Tim
Barker, Gregory	Conway, Derek
Baron, John (Billericay)	Cormack, Sir Patrick
Barrett, John	Cotter, Brian
Beggs, Roy (E Antrim)	Cran, James (Beverley)
Beith, rh A. J.	Curry, rh David
Bellingham, Henry	Davey, Edward (Kingston)
Bercow, John	Davies, Quentin (Grantham &
Beresford, Sir Paul	Stamford)
Blunt, Crispin	Davis, rh David (Haltemprice &
Boswell, Tim	Howden)
Bottomley, Peter (Worthing W)	Djanogly, Jonathan
Bottomley, rh Virginia (SW	Dodds, Nigel
Surrey)	Donaldson, Jeffrey M.
Brady, Graham	Doughty, Sue
Brake, Tom (Carshalton)	Duncan, Alan (Rutland)
Brazier, Julian	Duncan, Peter (Galloway)
Breed, Colin	Duncan Smith, rh lain
Brooke, Mrs Annette L.	Evans, Nigel
Browning, Mrs Angela	Ewing, Annabelle
Burns, Simon	Fabricant, Michael
Burnside, David	Fallon, Michael
Burstow, Paul	Flight, Howard
Burt, Alistair	Flook, Adrian
Butterfill, Sir John	Foster, Don (Bath)
Cable, Dr. Vincent	Fox, Dr. Liam
Cameron, David	Francois, Mark
Campbell, Gregory (E Lond'y,	Gale, Roger (N Thanet)
Campbell, rh Sir Menzies (NE	Garnier, Edward
Fife)	George, Andrew (St Ives)
Carmichael, Alistair	Gibb, Nick (Bognor Regis)
Cash, William	Gidley, Sandra

Gillan, Mrs Cheryl	Portillo, rh Michael
Goodman, Paul	Price, Adam (E Carmarthen &
Gray, James (N Wilts)	Dinefwr)
Grayling, Chris	Prisk, Mark(Hertford)
Green, Damian (Ashford)	Pugh, Dr John
Green, Matthew (Ludlow)	Randall. John
Greenway, John	Redwood, rh John
Grieve, Dominic	Reid, Alan (Argyll & Bute)
Gummer, rh John	Rendel, David
Hague, rh William	Robertson, Laurence (Tewk'b'ry)
Hammond, Philip	Robinson, Mrs Iris (Strangford)
Harvey, Nick	Robinson, Peter (Belfast E)
Hawkins, Nick	Rosindell, Andrew
Heald, Oliver	Ruffley, David
Heathcoat-Amory, rh David	Russell Bob (Colchester)
Hendry, Charles	Salmond, Alex
Hermon, Lady	Sanders, Adrian
Hoban, Mark (Fareham)	Sayeed, Jonathan
Hogg, rh Douglas	Selous, Andrew
Horam, John (Orpington)	Shephard, rh Mrs Gillian
Howard, rh Michael	Shepherd, Richard
Howarth, Gerald (Aldershot)	Simmonds, Mark
Hunter, Andrew	Simpson, Keith (M-Norfolk)
Jack, rh Michael	Smyth. Rev. Martin (Belfast S)
Jackson, Robert (Wantage)	Soames, Nicholas
Jenkin, Bernard	Spicer, Sir Michael
Johnson, Boris (Henley)	Spink, Bob (Castle Point)
Jones, Nigel (Cheltenham)	Spring, Richard
Keetch, Paul	Stanley, rh Sir John
Kennedy, rh Charles (Ross Skye &	Steen, Anthony
Inverness)	Streeter, Gary
Key, Robert (Salisbury)	Stunell, Andrew
Kirkbride, Miss Julie	Swayne Desmond
Kirkwood, Sir Archy	Swire, Hugo (E Devon)
Knight, rh Greg (E Yorkshire)	Syms, Robert
Laing, Mrs Eleanor	Tapsell, Sir Peter
Lait, Mrs Jacqui	Taylor. Ian (Esher)
Lamb, Norman	Taylor. John (Solihull)
Lansley, Andrew	Taylor, Sir Teddy
Laws, David (Yeovil)	Teather, Sarah
Letwin, rh Oliver	Tonge, Dr. Jenny
	Tredinnck, David
Lidington, David	Trend Michael
Llwyd, Elfyn	Tyler, Paul (N Cornwall)
Loughton, Tim	Tyrie, Andrew
Luff, Peter (M-Worcs)	Viggers Peter
McIntosh, Miss Anne	Walter, Robert
Mackay, rh Andrew	Waterson, Nigel
Maclean, rh David	Watkinson, Angela
McLoughlin, Patrick	Webb, Steve (Northavon)
Malins, Humfrey	Weir, Michael
Maples, John	Whittingdale, John
Marsden, Paul (Shrewsbury &	Widdecombe, rh Miss Ann
Atcham)	Wiggin Bill
Mates, Michael	Wilkinson, John
Mawhinney, rh Sir Brian	Willetts. David
May, Mrs Theresa	Williams, Roger (Brecon)
Mercer, Patrick	Willis, Phil
Moore, Michael	Wilshire, David
Moss, Malcolm	Winterton, Ann (Congleton)
Murrison, Dr. Andrew	Winterton, Sir Nicholas
Norman, Archie	(Macclesfield)
Oaten, Mark (Winchester)	Wishart, Pete
O'Brien, Stephen (Eddisbury)	Young rh Sir George
Öpik, Lembit	Younger-Ross, Richard
Osborne, George (Tatton)
Ottaway, Richard	Tellers for the Ayes:
Page, Richard	Mr. Peter Atkinson and
Paice, James	Mr. Mark Field

NOES
Abbott, Ms Diane	Anderson, rh Donald (Swansea E)
Adams, Irene (Paisley N)	Anderson, Janet (Rossendale &
Ainger, Nick	Darwen)
Ainsworth, Bob (Cov'try NE)	Atherton, Ms Candy
Allen, Graham	Atkins Charlotte

Austin, John	Dean, Mrs Janet
Bailey, Adrian	Dhanda, Parmjit
Baird, Vera	Dobbin, Jim (Heywood)
Banks, Tony	Dobson, rh Frank
Barnes, Harry	Donohoe, Brian H.
Barron, rh Kevin	Doran, Frank
Battle, John	Dowd, Jim (Lewisham W)
Bayley, Hugh	Drew, David (Stroud)
Beard, Nigel	Drown, Ms Julia
Beckett, rh Margaret	Dunwoody, Mrs Gwyneth
Begg, Miss Anne	Edwards, Huw
Bell, Sir Stuart	Efford, Clive
Benn, rh Hilary	Ellman, Mrs Louise
Benton, Joe (Bootle)	Ennis, Jeff (Barnsley E)
Berry, Roger	Etherington, Bill
Betts, Clive	Farrelly, Paul
Blackman, Liz	Fisher, Mark
Blizzard, Bob	Fitzpatrick, Jim
Borrow, David	Fitzsimons, Mrs Lorna
Bradley, rh Keith (Withington)	Flint, Caroline
Bradley, Peter (The Wrekin)	Flynn, Paul (Newport W)
Bradshaw, Ben	Foster, rh Derek
Brennan, Kevin	Foster, Michael Jabez (Hastings
Brown, rh Nicholas (Newcastle E	&Rye)
Wallsend)	Foulkes, rh George
Brown, Russell (Dumfries)	Francis, Dr. Hywel
Browne, Desmond	Gapes, Mike Ilford S)
Bryant, Chris	Gardiner, Barry
Buck, Ms Karen	George, rh Bruce (Walsall S)
Burden, Richard	Gerrard, Neil
Burnham, Andy	Gibson, Dr. Ian
Byers, rh Stephen	Gilroy, Linda
Campbell, Mrs Anne (C'bridge)	Godsiff, Roger
Campbell, Ronnie (Blyth V)	Griffiths, Jane (Reading E)
Casale, Roger	Griffiths, Nigel (Edinburgh S)
Caton, Martin	Griffiths, Win (Bridgend)
Cawsey, Ian (Brigg)	Grogan, John
Challen, Colin	Hain, rh Peter
Chaytor, David	Hall, Mike (Weaver Vale)
Clapham, Michael	Hall, Patrick (Bedford)
Clark, Mrs Helen (Peterborough)	Hamilton, David (Midlothian)
Clark, Dr. Lynda (Edinburgh	Hamilton, Fabian (Leeds NE)
Pentlands)	Hanson, David
Clarke, rh Tom (Coatbridge &	Harman, rh Ms Harriet
Chryston)	Harris, Tom (Glasgow Cathcart)
Clarke, Tony (Northampton S)	Havard, Dai (Merthyr Tydfil &
Clelland, David	Rhymney)
Coaker, Vernon	Healey, John
Coffey, Ms Ann	Henderson, Doug (Newcastle N)
Cohen, Harry	Henderson, Ivan (Harwich)
Coleman, Iain	Hendrick, Mark
Colman, Tony	Hepburn, Stephen
Cook, Frank (Stockton N)	Hesford, Stephen
Cook, rh Robin (Livingston)	Heyes, David
Cooper, Yvette	Hinchliffe, David
Corbyn, Jeremy	Hodge, Margaret
Cox, Tom (Tooting)	Hoey, Kate (Vauxhall)
Cranston, Ross	Hoon, rh Geoffrey
Crausby, David	Hope, Phil (Corby)
Cruddas, Jon	Hopkins, Kelvin
Cryer, Ann (Keighley)	Howarth, rh Alan (Newport E)
Cryer, John (Hornchurch)	Howarth, George (Knowsley N &
Cummings, John	Sefton E)
Cunningham, rh Dr. Jack	Howells, Dr. Kim
(Copeland)	Hughes, Beverley (Stretford &
Cunningham, Jim (Coventry S)	Urmston)
Cunningham, Tony (Workington)	Hughes, Kevin (Doncaster N)
Curtis-Thomas, Mrs Claire	Humble, Mrs Joan
Dalyell, Tarn	Hurst, Alan (Braintree)
Davey, Valerie (Bristol W)	Hutton, rh John
Davidson, Ian	Iddon, Dr. Brian
Davies, rh Denzil (Llanelli)	Illsley, Eric
Davies, Geraint (Croydon C)	Ingram, rh Adam
Dawson, Hilton	Irranca-Davies, Huw

Jackson, Glenda (Hampstead &	Martlew, Eric
Highgate)	Meale, Alan (Mansfield)
Jackson, Helen (Hillsborough)	Merron, Gillian
Jenkins, Brian	Michael, rh Alun
Johnson, Alan (Hull W)	Milburn, rh Alan
Johnson, Miss Melanie (Welwyn	Miliband, David
Hatfield)	Miller, Andrew
Jones, Helen (Warrington N)	Moffatt, Laura
Jones, Jon Owen (Cardiff C)	Mole, Chris
Jones, Kevan (N Durham)	Moonie, Dr. Lewis
Jones, Lynne (Selly Oak)	Moran, Margaret
Jones, Martyn (ClwydS)	Morgan, Julie
Joyce, Eric (Falkirk W)	Morley, Elliot
Kaufman, rh Gerald	Mountford, Kali
Keeble, Ms Sally	Mudie, George
Keen, Alan (Feltham)	Munn, Ms Meg
Kemp, Fraser	Murphy, Denis (Wansbeck)
Kidney, David	Murphy, Jim (Eastwood)
Kilfoyle, Peter	Naysmith, Dr. Doug
King, Andy (Rugby)	Norris, Dan (Wansdyke)
King, Ms Oona (Bethnal Green &	O'Brien, Bill (Normanton)
Bow)	Olner, Bill
Knight, Jim (S Dorset)	O'Neill, Martin
Kumar, Dr. Ashok	Organ, Diana
Ladyman, Dr. Stephen	Osborne, Sandra (Ayr)
Lammy, David	Owen, Albert
Lawrence, Mrs Jackie	Perham, Linda
Laxton, Bob (Derby N)	Picking, Anne
Lazarowicz, Mark	Pickthall, Colin
Lepper, David	Pike, Peter (Burnley)
Leslie, Christopher	Plaskitt, James
Lewis, Ivan (Bury S)	Pollard, Kerry
Liddell, rh Mrs Helen	Pope, Greg (Hyndburn)
Linton, Martin	Pound, Stephen
Lloyd, Tony (Manchester C)	Prentice, Ms Bridget (Lewisham
Love, Andrew	E)
Lucas, Ian (Wrexham)	Prentice, Gordon (Pendle)
Luke, Iain (Dundee E)	Prescott, rh John
Lyons, John (Strathkelvin)	Primarolo, rh Dawn
McAvoy, Thomas	Prosser, Gwyn
McCabe, Stephen	Purchase, Ken
McCartney, rh Ian	Purnell, James
McDonagh, Siobhain	Quin, rh Joyce
MacDonald, Calum	Rapson, Syd (Portsmouth N)
McDonnell, John	Raynsford, rh Nick
MacDougall, John	Reed, Andy (Loughborough)
McGrady, Eddie	Robinson, Geoffrey (Coventry
McGuire, Mrs Anne	NW)
Mclsaac, Shona	Roche, Mrs Barbara
McKechin, Ann	Ross, Ernie (Dundee W)
McKenna, Rosemary	Roy, Frank (Motherwell)
Mackinlay, Andrew	Ruane, Chris
McNamara, Kevin	Ruddock, Joan
Mactaggart, Fiona	Russell, Ms Christine (City of
McWalter, Tony	Chester)
McWilliam, John	Ryan, Joan (Enfield N)
Mahmood, Khalid	Salter, Martin
Mahon, Mrs Alice	Sarwar, Mohammad
Mallaber, Judy	Savidge, Malcolm
Mann, John (Basset/aw)	Sawford, Phil
Marris, Rob (Wolverh'ton SW)	Sedgemore, Brian
Marsden, Gordon (Blackpool S)	Shaw, Jonathan
Marshall, David (Glasgow	Sheerman, Barry
Shettleston)	Sheridan, Jim
Marshall, Jim (Leicester S)	Simon, Sion (B'ham Erdington)

Simpson, Alan (Nottingham S)	Trickett, Jon
Singh, Marsha	Truswell, Paul
Skinner, Dennis	Turner, Dennis (Wolverh'ton SE)
Smith, rh Chris (Islington S &	Turner, Dr. Desmond (Brighton
Finsbury)	Kemptown)
Smith, Geraldine (Morecanbe &	Twigg, Stephen (Enfield)
Lunesdale)	Vaz, Keith (Leicester E)
Smith, Jacqui (Redditch)	Vis, Dr. Rudi
Soley, Clive	Walley, Ms Joan
Spellar, rh John	Ward, Claire
Squire, Rachel	Wareing, Robert N.
Starkey, Dr. Phyllis	Watson, Tom (W Bromwich E)
Stevenson, George	Watts, David
Stewart, David (Inverness E &	White, Brian
Lochaber)	Whitehead, Dr. Alan
Stewart, Ian (Eccles)	Wicks, Malcolm
Stoate, Dr. Howard	Williams, Deny \\^uiivvyj Wills, Michael
Strang, rh Dr. Gavin	Winnick, David
Stringer, Graham	Woodward, Shaun
Sutcliffe, Gerry	Woolas, Phil
Tami, Mark (Alyn)	Worthington, Tony
Taylor, rh Ann (Dewsbury)	Wright, Anthony D.(Gt
Taylor, Dari (Stockton S)	Yarmouth)
Taylor, David (NW Leics)	Wright, David (Telford)
Thomas, Gareth (Clwyd W)	Wyatt, Derek
Thomas, Gareth (Harrow V)
Timms, Stephen	Tellers for the Noes:
Tipping, Paddy	Derek Twigg and
Todd, Mark (S Derbyshire)	Mr. John Heppell
Touhig, Don (Islwyn)

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended to be agreed to.

Resolved,

That this House welcomes this debate and congratulates the Trade Justice Movement on its efforts to raise public awareness of this vital issue; reiterates the commitment made in the White Paper Eliminating World Poverty: Making Globalisation Work for the Poor to improve international trade rules; urges the European Union to make further progress on reforming the Common Agriculture Policy regimes for cotton, sugar, tobacco and olive oil; welcomes the UK's call for action on HIV/AIDS; congratulates the Government on the £160 million it has allocated to trade-related capacity building in developing countries since 1998; welcomes the fact that the UK's aid budget for Africa will rise to over £ 1 billion by 2005; welcomes the launch of a new initiative, the Commission for Africa. t, to take a fresh look at the challenges Africa faces; notes that a successful Doha Round could contribute substantially to the achievement of the Millennium Development Goals; congratulates the Government on the lead it has taken within the EU and the WTO to promote free and fair trade; believes that significant pr egress must be made to improve access for developing country exports to both developed and developing country markets, including through substantial reductions in trade distorting agricultural subsidies; calls on all WTO members to continue to demonstrate their commitment to the Doha Development Agenda; and underlines this House's commitment to ensuring the Doha Round produces real benefits for the poor.