HL Deb 09 March 2005 vol 670 cc735-7

2.59 p.m.

Lord Faulkner of Worcester

asked Her Majesty's Government:

What is their response to recent reports that the lifting of the European Union embargo on arms sales to China would lead to a retaliatory decision by the United States Administration to restrict technology sales to European companies.

Lord Triesman

My Lords, I refer the House to the evidence that my right honourable friend the Foreign Secretary gave to the Committee on Strategic Export Controls in another place on 12 January. The United States has a legitimate and understandable interest both in the effectiveness of the EU's system of arms control and in the stability of the East Asian region. Whatever the final decision from the EU review, we need to do our best to reassure the United States on the effectiveness of the EU code of conduct, which will remain the key to controlling EU arms exports to China.

Lord Faulkner of Worcester

My Lords, I thank my noble friend for that Answer, in particular for its understanding of the need to satisfy the United States, which feels very strongly about these issues, that any change in the arms embargo policy needs to be maintained. Does he agree that it is critical to the stability of the region that the status quo is maintained on both sides of the Taiwan Strait and that there should be no loose talk of independence on the part of Taiwan? Does he also agree that, equally, no inflammatory legislation should be introduced by China which seeks to justify an invasion?

Lord Triesman

My Lords, I can assure the House that the Government recognise the importance of stability on both sides of the Taiwan Strait and of regional stability in general. The code of conduct is, and will remain, the primary means of controlling arms sales in that and other regions. In December 2004, the European Council's conclusions underlined the importance of the code's criteria on regional stability and the security of allied and friendly countries. It may be helpful to draw one element of the code to the attention of the House—that is, weapons should not be exported if they would be used, aggressively against another country or to assert by force a territorial claim". Finally in response to my noble friend, we have not yet seen—I do not believe that anyone has yet seen, other than in newspaper reports—the text of the anti-cessation legislation that the Chinese Government propose to introduce, as I understand it, next week. But it is certainly true that we welcome the more conciliatory developments between China and Taiwan and believe that anything that disturbed those would be to our disadvantage.

Baroness Rawlings

My Lords, how do the Government reconcile lifting this embargo with Britain's national interests, knowing that British defence companies must be worried by the US Congress's threat to cut off vital technology transfers to British companies?

Lord Triesman

My Lords, the resistance of the United States Government and many US companies to exchanging information is a long-standing issue. It goes back a considerable way—before these recent changes in the possibility of trading with China. Some people on both sides of Congress have observed that such resistance may be more to do with the protection of United States industries over that period than with other matters. We are fully seized of the concerns expressed in the United States, but we believe that the proposed arrangements will be an effective means of controlling both the quality and quantity of exports to the PRC. Close defence cooperation between the United Kingdom and the United States is plainly beneficial and vital to both countries, and I am sure that we would do nothing to undermine that in the long term.

Lord Wallace of Saltaire

My Lords, can the noble Lord confirm that it does not require the excuse of lifting an arms embargo to China for Congressman Hunter and others to be entirely opposed to allowing access to American technologies? Can he also confirm that the level of American and Israeli exports of arms to China over the past two to three years has been much higher than that from all the European states put together and that certainly Israeli exports to China have included some very sensitive technologies without, so far as I am aware, the US Administration objecting?

Lord Triesman

My Lords, as I think I indicated in my previous answer, I confirm that these matters may not be entirely due to changes in arrangements in Europe. Incidentally, I should add that recent legislative change in the United States has also speeded up the system of export licensing and authorisations, and so our dealings with the United States of America have not been all adverse, one-way traffic. I do not have here at the Dispatch Box figures on Israeli exports to China. However, from what I have read second-hand, I believe that both Israel and the United States exceed us in the volume of such exports.

Lord Marsh

My Lords, does the Minister agree that there is a very dangerous situation in the Taiwan Strait at present, which was not helped by the joint declaration by the United States and Japan recently? This is yet another example of the same problem. I declare an interest. I have seen the wording of the law which is arriving next week, and that at least should provide an opportunity, whether it will work or not, to get some stability in this area.

Lord Triesman

My Lords, the Government believe it is absolutely vital to get stability on either side of the strait. Our view is that the Taiwan question should be settled peacefully through negotiation between the peoples on both sides of the strait. We are actively encouraging both sides to take that course of action rather than any other, and certainly rather than anything that would inflame the situation. It is the case that a large number of people from Taiwan—more than 1 million, I believe—live in China, and I think that a high proportion of inward investment into Taiwan is by China. Everyone there has every interest in a normal, peaceful and stable relationship. We will encourage that.