House of Commons Hansard Debates for 22 Jun 1994

Ms Diane Abbott (Hackney, North and Stoke Newington) : How can the Minister claim that all those welcome phenomena are due to British Government policy ? We await his claim that the Government are responsible for the sun rising and setting every day. There have been positive developments in the third world, but they are no thanks to the Government and their appalling record on aid.

Mr. Goodlad : The hon. Lady is entitled to her view.

Change has been most dramatic in east and south-east Asia, where there has been development at a rate unparalleled in history. During the past 25 years, many of those countries have grown, from being poor by any standards to approaching or in some cases passing living standards in OECD countries. They are formidable competitors in their own right.

That experience is now spreading. In south Asia there is a growing commitment to economic reform. Countries are starting to reap the benefits. India--for some years our biggest aid recipient--has seen an eightfold growth in foreign investment. Growth has doubled during the past three years and India's export growth is forecast at more than 13 per cent. this year.

Those in favour of protectionism may quail at the emergence of those new competitors, but it is clear evidence that countries pursuing the right sort of policies can develop successfully and it is a development that we should welcome. Yes, they present competitive challenges, but they also present rapidly increasing markets for our trade and investment.

The most important single factor in determining whether countries develop successfully is their Government's actions and policies. Do those provide a framework in which individuals and communities can help themselves ? Do they encourage wealth creation ? It is both wrong and patronising to see the developed world as being solely responsible for the fate of the developing world. The successful developing countries are increasingly earning their own way in the world through trade and through rapidly increasing private investment to finance their development.

One encouraging feature has been the substantial increase in the flow of private finance to developing countries. The OECD estimates that total resource flows to the developing world rose by $42 billion in 1992, to $176 billion--a 23 per cent. real-terms increase. Virtually all of

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that growth was attributable to the large expansion of private finance flows, which rose by nearly 50 per cent. The World bank expects private finance flows to have exceeded official flows in 1993.

To take two examples, although world-wide foreign direct investment fell in 1991 and 1992, flows of direct investment into the developing world increased. Portfolio equity investment soared by more than 60 per cent. in 1992 as new stock markets opened, many in developing countries.

Dr. Kim Howells (Pontypridd) : I am sure that few hon. Members present will not welcome those figures, but will the Minister make it clear that much of that money is going to a few markets only ? It is going mainly to the south-east Asian countries--the Pacific tigers--and not to Africa, which is what worries us.

Mr. Goodlad : The hon. Gentleman makes a fair point. Certain developing countries, such as India, have been very aid dependent, but are beginning to attract flows of private investment, by the methods that I am attempting to describe. We want to help other countries, such as those in sub-Saharan Africa, to reach a position where they can collect such flows of private investment. That is an important point.

British companies and financial institutions have played a major part in that flow--accounting for around half the European Community total. That clear evidence of their increasing attractiveness for private investment and lending is one reason for a degree of greater optimism about the prospects for developing countries. That is a very important change.

Successes in development must not obscure the massive needs that many of the poorest people in the poorest countries still have. Progress has not been uniform. More than 1 billion people in the world are still in absolute poverty--70 per cent. of them are in sub-Saharan Africa and Asia. A key element of our strategy is, therefore, to focus our aid where it is most needed--on the poorest. Those countries do not yet have access to private investment. Many of the poorest countries, particularly those in sub- Saharan Africa, have not benefited from the increase in flows of private finance that we have seen.

Our strategy to help developing countries is clear and has a number of strands. First, developing countries need peace and security. That is not something that can be imposed from outside, but the United Kingdom's role in the United Nations, the North Atlantic Treaty Organisation and the Commonwealth makes a major contribution to the international effort to create a more stable and more peaceful world, and our armed forces provide a highly effective and highly valued presence in many peacekeeping forces.

Secondly, many countries need debt relief. For the poorest, most indebted countries, debt repayments continue to pose a massive burden. They swallow up resources which could otherwise be used to finance productive investment and thus raise living standards. If a country is not making repayments, that presents a major obstacle to its receiving renewed external finance other than aid. Again, that is an area in which we have taken the

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lead. We have relieved developing countries of the burden of £1.1 billion of old aid loans. All our aid to those countries is on grant terms.

We have constantly led the way in promoting international agreement on debt relief for the poorest and most indebted countries through the Toronto terms in 1988, the Trinidad terms in 1991, and now in our push for improved Trinidad terms. The current terms have so far benefited 22 of the poorest, most indebted countries. More than $2.7 billion will be forgiven over the lifetime of those agreements. We believe that more needs to be done and are pressing other creditors to agree to implement full Trinidad terms. We must move forward, with others, to maximise the benefits to indebted countries.

Mr. Cash : On that point and on the very satisfactory arrangements that we have made in regard to Trinidad, does my right hon. Friend agree with my earlier argument about the World bank ? Will he do everything that he can to encourage it to adjust its arrangements to suspend debt where necessary, and where appropriate circumstances apply, in countries that are helping to help themselves ?

Mr. Goodlad : Yes. On the Trinidad terms, we recognise the seriousness of the debt situation of the poorest, most indebted countries in Africa, which is reflected in the World bank report, and the need for the most generous levels of debt reduction, under the Trinidad terms, on a case-by-case basis. We shall continue to press our partners to take the same view. We regard it as important that multilateral debts are serviced to maintain the integrity of the institutions, but generous balance of payments aid to those countries pursuing economic reform is designed to permit such debt servicing, as well as meeting their import requirements.

I share the concern of my hon. Friend the Member for Stafford (Mr. Cash) about Uganda's heavy debt burden, but action on bilateral debt through the Paris Club will be the most effective way to tackle the problem. Full Trinidad terms--we would like Uganda to be one of the first beneficiaries if these are agreed--would release more money for multilateral debt servicing and other needs.

A critical issue is the ability to pay, and donors have been careful to ensure that Uganda has no balance of payments crisis. Altogether it received £244 million more in 1992 than it paid. This report is very flexible and can be used to service multilateral debt if Uganda so chooses.

Thirdly, developing countries need freer trade. Opening markets is probably the most important single thing that the developed world can do for developing countries as a whole and for the former eastern bloc. None worked harder than the UK in pushing for a succesful outcome to the GATT Uruguay round.

The Uruguay round presents opportunities to all countries and should be seen as a threat by no one. Certainly various studies have suggested that the benefits to developing countries will be unevenly spread. But the increased world prosperity which a successful Uruguay round will bring is good news for all the world and gives all countries the opportunity to benefit--provided they pursue the right mix of economic policies to enable them to do so.

Mr. John Denham (Southampton, Itchen) : The Minister has referred to various studies which generally show that African countries will be worse off in absolute terms as a result of the GATT negotiations because the

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relative advantage of the Lome preferences will be lost. Will the Minister give a commitment to make sure that those countries are compensated for the loss they will suffer under the new trading arrangements ?

Mr. Goodlad : The recent OECD-World bank study on the round concluded that the proposed liberalisation of trade in manufactured and agricultural products would raise incomes in non-OECD countries by some $78 billion a year. [Interruption.] I will answer the hon. Gentleman's point in a moment. [Interruption.]

Madam Deputy Speaker (Dame Janet Fookes) : Order. The House does not need a running commentary from hon. Members.

Mr. Goodlad : The report concluded that developing countries would suffer most from a continuation of protectionism or, worse still, an intensification of protectionism.

However, we agree that the effects on some developing countries will need to be looked at in the light of the real concern they have expressed, for example, about the erosion of their advantages in terms of tariff preferences. At the European Community-African Caribbean Pacific council in April we endorsed a commitment to do that, a commitment which was already enshrined in the fourth Lome convention.

Mr. Mike Gapes (Ilford, South) : What proposals will the Government make to assist the countries in the Caribbean which are particularly badly hit, as well as those in Africa ?

Mr. Goodlad : That is a matter for the Lome review.

Particular concern has been expressed about the difficulties which net food importing developing countries may face if world food prices rise as a result of cuts in subsidies under the Uruguay round agricultural agreement. But the GATT agreement includes provisions to assist net food importers in such circumstances and, in the longer term, higher prices should stimulate agricultural production in developing countries and so boost rural economies.

Mr. Cynog Dafis (Ceredigion and Pembroke, North) : I am a little worried by the facile assumption that increased world trade will inevitably lead to a better world for the people who live in it. Is not it true that constant and massive expansion of world trade could involve constantly increasingly transportation unless there is particular application to the question of the environmental effects ? Is not constantly increasing transportation one of the great threats to the environment ? Is not it time we were talking seriously about internalising the environmental costs of transportation and of trade into prices so that we could have a different and more decentralist pattern of production, consumption and distribution ?

Mr. Goodlad : I think that the increase in world trade will benefit all countries, but it will be uneven in its impact. I accept that transportation increases will have environmental effects, and I shall say something about environmental matters in a moment.

Ms Abbott : On the specific point of the GATT round, is the Minister aware of the particular problems in the eastern Caribbean, which almost wholly depends on the export of bananas for its balance of trade ? When will Ministers face up to the fact that one cannot look at the

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issues of aid and development in isolation ? If the small agriculturists in the countries of the eastern Caribbean are no longer able to sell their bananas, many of them will instead turn to drug production. We cannot look at aid policies in isolation, because they also impact on issues such as the international drugs trade and the refugee question.

Mr. Goodlad : I quite agree that we cannot look at aid issues in isolation, and I am trying to demonstrate that a large number of factors are involved. I hope that we have fought a good fight for Caribbean banana producers.

Mr. Lester : Does not my hon. Friend agree that, as far as the GATT round is concerned, developing countries co-operated fully in the negotiations for the first time ? They have been the largest group in the negotiations and they are queuing up to join the World Trade Organisation. That hardly suggests that those countries have all the fears which are being expressed by Opposition Members. The House had a debate on GATT last week.

Mr. Goodlad : My hon. Friend is very knowledgeable on these matters and he makes an extremely accurate point as usual.

We welcome the establishment of the World Trade Organisation which will put the GATT on a permanent institutional footing for the first time ever.

Fourthly, we have a substantial aid programme, one that has been highly commended for its effectiveness. As the Development Assistance Committee of the OECD recently reported :

"The UK has a highly concessional, well organised bilateral programme based on substantial natural expertise and is orientated towards the poorest developing countries."

At over £2.2 billion this year, it is the sixth biggest programme in the world. I understand that new OECD figures are likely to be released tomorrow showing that in 1993 the UK's Aid-GNP ratio of 0.31 per cent. was above the average for all donors, and that the UK was one of seven donors who increased their aid. At a time when many donors are facing pressures on their budgets, that is clear evidence of the Government's commitment to a substantial aid programme. One key factor in the programme's effectiveness is that it is closely focused on where it will do most good. It is targeted closely on the specific needs of developing countries. Focusing our aid on the individual needs of countries means taking account of the changes in the developing world which I described earlier.

For the more successful and better-off developing countries, well-targeted aid has played a major part in helping their countries develop. In many of them it continues to do so. But with their increasing access to private investment, many no longer need large scale concessional finance to finance their development.

Aid is equivalent to less than 1 per cent. of the GNP of Asian developing countries, and less than 0.5 per cent. of that of Latin American developing countries. In those countries, our aid strategy therefore is increasingly to provide advice and know-how, and filling skills gaps in areas central to their development.

We have also helped the vital transition to market economies and political pluralism in east and central Europe and the former Soviet Union.

Dr. Norman A. Godman (Greenock and Port Glasgow) : Will the Minister give way ?

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Mr. Goodlad : I must make some progress.

That has involved help through multilateral channels and through our bilateral programme, the know-how fund, which seeks to harness British expertise to help this vital transition. Our know-how fund was a pioneering idea, and has offered a model of technical assistance which others have tried to copy. Much of the know-how fund is directed at bringing about systemic change, particularly in areas central to the functioning of the market economy such as privatisation, banking and capital markets. In Russia, we are co-operating with the International Finance Corporation in launching and testing a system for land privatisation which has been adopted by the Russian Government as a model for the country.

Longer-term institutional development is not neglected, however. A major part of know-how fund resources is devoted to training, including the setting up and strengthening of local institutions. In Poland, we have helped to set up a network of four regional management centres to train a new generation in private investment. Nor do we neglect the importance of the political transition to democracy. In Russia, for example, our programme for democracy is supporting a variety of parliamentary exchanges and educational programmes involving democratic institutions and principles. The know-how fund's responsiveness and effectiveness in supporting reform are known and recognised throughout the region.

I referred earlier to the continuing needs of the poorest countries. Our strategy is to focus most of our concessional finance assistance on those countries whose needs are greatest and which are unable to attract significant private finance. Some 80 per cent. of our bilateral aid goes to the poorest countries--a larger proportion than is provided by any other G7 donor. Our 10 biggest aid recipients are all low-income countries in sub- Saharan Africa and Asia : our record stands comparison with that of any major donor. All our aid is on grant terms, thus avoiding adding to the debt burden of developing countries.

In those countries, sustainable development and the reduction of poverty are at the centre of our effort. Our aid is targeted on areas that were recognised at the United Nations conference on environment and development at Rio as being central to promoting sustainable development--such as support for sound economic policies that encourage wealth creation, and helping developing countries to improve the education and health services that they provide. An important example is the increasing part that we are playing in the effort to help developing countries to address the population pressures that many of them face. The world's population is currently 5.6 billion ; it is growing by almost 1 billion each decade, and could double by the year 2050.

Recent decades have seen remarkable progress in the provision of family planning information and services for millions of people in developing countries, but population growth in such countries is at an historic high. More than 90 per cent. of the annual increase in population of over 90 million takes place in the countries that can least afford to provide for their new citizens. In the poorest countries, population growth threatens the prospect of achieving sustainable dvelopment and reducing poverty. Half a million women in developing countries die each year from pregnancy- related causes, including unsafe and often

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illegal abortions. There are at least 250 million cases of sexually transmitted disease each year, and more than 14 million people are now estimated to be infected with HIV.

Providing safe, effective and affordable reproductive health services, including family planning, will lead to improvements in the health of women and children and reduce the number of maternal and child deaths.

Mr. Richard Ottaway (Croydon, South) : I am delighted that my right hon. Friend is focusing his remarks on the question of population. I know that, as a founder member of the all-party group on population and development, he has a personal interest in the matter. Many of us agree with my right hon. Friend that over-population is a root cause of poverty. Does that not make it all the more surprising that the hon. Member for Monklands, West (Mr. Clarke), whose speech was made in all sincerity, made no reference to the population question ?

Mr. Goodlad : I am grateful to my hon. Friend. He is right : I was a founder secretary of that all-party group, under the chairmanship of my right hon. Friend the Member for Mole Valley (Mr. Baker). When I entered the Government, I was succeeded by my hon. Friend the Member for Loughborough (Mr. Dorrell), who is now Financial Secretary to the Treasury. We attended the 1979 United Nations conference in Columbo, to which I believe an extremely distinguished contribution was made by Madam Speaker herself.

The hon. Member for Monklands, West (Mr. Clarke) did not mention population in his speech ; he could not mention everything, and I cannot do so either. It is an important matter, however. I believe that providing the services that I have mentioned will enable women to take more control over their lives.

Mr. Tom Clarke : I am grateful to the Minister : I know that he said that there were many issues with which we might have wished to deal. Today's debate is taking place in Opposition time. I promise that, if the Government give us a full day to debate these matters, I shall be happy to deal with the question of population and other issues.

Mr. Goodlad : I would hardly support my right hon. Friend the Leader of the House if he gave us a whole day to debate population. The services that we are providing will help to slow population growth and lead to improvements in the quality of life for families. Helping family planning and other reproductive health services is an integral element of our sustainable development strategy. The ODA aims to continue to help more women and men to choose when to have children, to improve their reproductive health. We shall focus on improving access to family planning for both women and men, making pregnancy and childbirth safer for women and improving the sexual health of men and women.

We are playing an active part in preparations for the United Nations international conference on population and development, to be held in Cairo in September this year. Agreement among donors and developing countries on the need for urgent action has never been greater. The conference will provide a good opportunity for us to build on the current level of consensus, which is extremely important. We are working hard to ensure wide support for the Cairo action plan.

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As I have said, most of our aid is long-term development assistance ; but if disaster strikes--whether man-made or natural--we make a major contribution to the international emergency aid effort. The terrible conflict in Rwanda, of which the hon. Member for Monklands, West gave a moving account, is at the centre of our attention. My noble Friend the Minister for Overseas Development announced a further allocation of £5.23 million in emergency aid on 2 June. A large proportion will continue to support the relief activities of non- governmental organisations. More than £11 million has now been committed bilaterally since 6 April.

We were one of the first countries to respond with key logistical help to open up communications in northern Tanzania to the refugee camps. We are providing 5,000 tonnes of emergency food aid--a quarter of the amount specified in the world food programme appeal. We are monitoring the position closely. In May we sent an assessment mission to the region ; it found that British emergency aid, including that of the NGOs, is being used effectively and is much appreciated. The co-ordination between the United Nations agencies, the NGOs and the Red Cross movement was impressive. A further ODA assessment mission will be sent next month.

As the hon. Member for Monklands, West knows, the political situation is still volatile and the refugee exodus continues. External emergency aid is required for the foreseeable future. We remain ready to do more, particularly when safe access to other parts of Rwanda is possible. We have offered logistical support to the United Nations aid mission in Rwanda, but not troops.

We continue to be at the forefront of the international community's efforts to help to relieve the suffering of those caught up in the conflict in the former Yugoslavia. We have committed nearly £175 million in humanitarian aid so far. More than 100 British trucks, together with drivers and support staff, are working as part of the delivery operation of the United Nations High Commissioner for Refugees. We are also assisting with vital work to restore the infrastructure--such as electricity supplies in central Bosnia--and helping to restore water and sewerage systems. We are at the forefront of the international reconstruction effort in Sarajevo. In 1992-93 we provided, bilaterally and multilaterally, more than £290 million in emergency assistance. I pay particular tribute to the NGOs, with which we work both in providing emergency aid and in our long- term development programmes. They show great dedication--as both the hon. Member for Monklands, West and I have seen for ourselves--great industry and, in many cases, great courage. More of our aid is being channelled through them--more than £140 million in 1992-93--in recognition of their special abilities, particularly in working with the poorest. I am sure that the whole House will join me in recognising the dedication of those NGOs and the people who work in them.

Finally, we use aid to help developing countries to address issues such as climate change, the destruction of biodiversity and ozone depletion, helping them play their part in tackling those global challenges. The United Kingdom has contributed £130 million to the global environment facility, which helps developing countries to meet the costs which they face in doing so. That makes us the fifth largest contributor overall.

The speech of the hon. Member for Monklands, West, who is the kindest of men, was an excellent example of

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what his party does best : pious sentiments combined with woolly thinking--not to mention an intellectual sleight of hand which I will come to in a moment. Predictably, he plays games with numbers, and I make no complaint about that. But he should come clean with the House. Is he prepared to pledge that Labour would reach the UN target of 0.7 per cent. of GNP within the lifetime of a Parliament ? Is he aware that the shadow Chancellor, the hon. Member for Dunfermline, East (Mr. Brown), is repudiating all the spending pledges made by his fellow Front- Bench spokesmen in his bid to win the Labour party some economic respectability ? Has he cleared his lines with the shadow Chancellor, or does he have his own personal supply of confetti money ?

Once again, the Labour party is trying to have it both ways, and it will be rumbled. Fine intentions are simply not enough : the last Labour Government gave a firm pledge in 1974 to meet the UN target and ended up cutting £50 million off the aid budget in 1977 and 1978.

There is only one way to maintain a substantial aid programme, and that is to pursue policies for enterprise and sustainable growth. Until the Labour party understands how prosperity is generated, it will have to go on looking for ever more ingenious ways of dividing up a shrinking cake.

If we are serious about helping the poorest countries, we must let the facts of economic life intrude. Nowhere is that more true than with trade, which brings developing countries three times as much revenue as aid. If we do not take their exports, we shall condemn them to continued poverty. The crucial point is that trade is not a zero-sum game. All countries benefit from increased trade. Yet the Labour party cannot get its collective brain, or its collectivist brain, around this point. The European socialist manifesto, to which Labour is committed and which the shadow Foreign Secretary, the right hon. Member for Copeland (Dr. Cunningham), apparently co-authored, warns that

"the principle of free trade must not be used to undermine social standards in Europe. We must protect our economy from unfair trading and we must try to combat social and environmental dumping". We could not have it clearer than that. The Labour party sees an inherent conflict between the interests of the developing countries and the interests of Europe. It is worried that the poorest countries might try to exploit their competitive advantage by exporting into our markets. It calls that dumping. We on this side of the House call it something rather different. We see trade with the developing world for what it is--a chance for developing countries to build up their own economies and to become more self-reliant. That is why we have led the drive to open up world markets. The Labour party's hostility to free trade shows that, when the chips are down, it puts the interests of the trade unions--its paymasters--over the interests of the world's poorest countries. While Labour postures, the Conservatives will leave our friends in the developing world in no doubt that only we can be relied upon to champion their interests. The Government have helped to transform the international debate about aid to the overwhelming advantage of the world's poorest countries. Unlike many who strike attitudes on the subject of aid, our aim has been not to salve our consciences but to take practical steps to help developing countries achieve self-reliance.

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We have led the way on debt relief. We have introduced the idea of using aid as a lever for good government, sensible economic policies and human rights. We have led the fight for open and generous trade arrangements for the third world through the GATT. We have argued that aid programmes should be targeted first and foremost on the poorest countries, and we practise what we preach. With our excellent voluntary agencies, whose expertise and experience in the field is second to none--not to mention our outstanding military personnel--we have shown how emergency relief should play a key role in aid strategy. We are saving hundreds of thousands of lives in the process, as we are in Bosnia-- [Interruption.] The hon. Member for Glasgow, Central (Mr. Watson) thinks that that is funny. He has a warped sense of humour.

We have helped to bring about a whole new emphasis on the quality and effectiveness of aid programmes, with the European Commission next in our sights.

The British people are a generous and outward-looking people, with broad horizons born of our history. Under this Government, they have seen Britain recover its standing as a global power with global interests and global responsibilities. Under this Government, there can be no question of shuffling off those responsibilities or retreating into our shell. Nor will we fight shy of asking some hard and searching questions when it is in the interests of the poorest countries that we should do so.

Those are the measures of our commitment to work with others to eliminate the poverty and misery that still affect much of the world. The British public expect nothing less. The world's poorest deserve nothing less.

5.25 pm

Sir David Steel (Tweeddale, Ettrick and Lauderdale) : I have never heard the Minister's best friends accuse him of being a dangerous demagogue and I suppose that we must congratulate him on batting nobly for the Government this afternoon. I hope that he will not take it personally if I say that overseas aid debates have suffered in this Parliament from the fact that the Minister responsible for those matters is in another place and not here to participate in the debates ; but that cannot be helped.

I do not know whether hon. Members can be accused of tedious repetition if they repeat what they said on previous occasions. I suppose that they should be, and I shall not repeat all our criticisms of the decline in the overseas aid budget, our recognition of what the Government have done on debt, or the fact that they need to do more. I have spoken on those subjects before. In this brief contribution, I wish to support the basic plea for a White Paper on overseas development made in the Opposition motion, but to do so in the context of two issues that are rarely dealt with in these debates : first, the campaign against the arms trade and, secondly, the campaign against corruption.

I remind the House that, last year, a young graduate, Sean Devereux, was killed in Somalia while working for UNICEF. Some time later, his father wrote to me enclosing a last letter that the young man had written to his parish church. In it, he described the chaos in Somalia. I shall quote two paragraphs from it as it serves as an introduction to my remarks this evening. He wrote :

"Everything was turned upside down because of the greed and ego of certain men. Siad Barre, the former dictator, General Aideed, Morgan and Ali Mahadi, the so-called warlords, are the

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usual names mentioned in this battle of power. But one must add to the list : the US Congress, the former Soviet Politburo, the Italian and British parliaments ; apparently a noble collection of men and women, who over the years approved the production and delivery of weapons of destruction to Somalia--for its own self-interest of course. The greed starts here.

Today in Somalia, in the southern part of Kismayo, I cannot walk from my house to my office (a distance of 400 metres) without heavily armed bodyguards. Thousands upon thousands of men in Somalia have their own weapons . . . they tell me this is for survival'. Boys of 14 live out their Rambo fantasies, believing they are fighting for freedom. They are so blind . . . but who can blame children. In Kismayo I wander through the market, checking the prices of looted UN food--wheat, rice, beans, etc., and I see next to the bananas and camel meat--AK47s, Kalashnikovs, Barrettas, M16s, Bazookas, varying in prices from $75 up to $200--all made in the so-called civilised world'. Next door to my home is a shack with the sign SPARE PARTS'. Sadly it's not for cars but for weapons, again made in the civilised world'. We have a lot to answer for."

As I have said before in the House, there is no more appalling hypocrisy in international politics today than the way that countries in the developed world compete in the sale of arms to unstable regimes, then stand around wringing their collective hands the moment that they are used.

The United Nations Children's Fund, the organisation for which Sean Devereux worked, estimates in a recent report that throughout the late 1980s, the world's military spending was running close to $1 trillion a year, or the equivalent of the combined annual incomes of the poorest half of the world's people. Those are shattering statistics. The donor nations, including ourselves, need to re-examine collectively our military spending and our dependence on the export of military equipment and technology. I acknowledge that the United Nations register of arms sales is a start, but it needs to be upgraded into an instrument to control the trade.

One of the places where we must begin is the European Union, because it is no good one nation unilaterally taking steps if another undermines the policy. All hon. Members--or most, at any rate--have ended up subscribing to the intentions of the Maastricht treaty to develop a common foreign policy in the European Union. If one considers the arms trade in the European Union, one realises the need for such a policy. For example, Portugal decided on a national ban of arms sales to Indonesia, but the German Government provided naval vessels to Indonesia, so the action of one European Union member state is vitiated by the action of another. The need for a common policy could not be more obvious.

That is also true of land mines, which were mentioned by the hon. Member for Monklands, West (Mr. Clarke), the Opposition spokesman. As long ago as last December, the United Nations General Assembly overwhelmingly passed a resolution calling for a ban on the export of anti-personnel mines. If the Government will not listen--as, apparently, they do not--to the Opposition or myself, they might take note of the trenchant article written by that wise old bird, Lord Deedes, in The Daily Telegraph as a result of his experiences in Angola, where he saw the effect of land mines. That is another issue on which the European Union could give a lead.

On the wider issue of the effect of arms sales on the developing world, the United Nations Development Programme has just published a substantial and valuable report showing clearly how reductions in weapon expenditure in the developing world could give major help with human resource development. It has argued in that

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report that it is doubtful whether the spending by the developing world brought increased security to the average citizen. It says : "In developing countries, the chances of dying from social neglect (from malnutrition and preventable diseases) are 33 times greater than the chances of dying in a war from external aggression. Yet, on average, there are about 20 soldiers for every physician" in the developing world.

"If anything, the soldiers are more likely to reduce personal security than to increase it."

We know of plenty of evidence of that. It also says :

"Developing countries have fought few international wars, and many have used their armed forces to repress their"

own

"people. Arms spending undermines human security in another way--by eating up precious resources that could have been used for human development."

It is a great pity that we do not allow visual aids in the Chamber because that report publishes a graph, which I can only attempt to describe to the House. It shows, on the left hand side, a column of the military spending in the developing world, and points out that a 12 per cent. cut in such spending could have the following effect on the health of the people in the third world. It could make available the additional funds to provide primary health care for all, including immunisation of all children, elimination of severe malnutrition, the halving of moderate malnutrition and the provision of safe drinking water for all.

A further 4 per cent. cut in military spending in the developing world could produce the resources to reduce adult illiteracy by half, providing universal primary education and educating women to the same level as men. A further 8 per cent. cut, making a total of a 24 per cent. cut in military spending, would provide the additional cost of a basic family planning package to all willing couples and--this takes up the Minister's point-- stabilise the world population by the year 2015. In other words, the gains to be had by giving greater political priority to the control of the arms trade are colossal. I believe that we should pay far more attention to that subject.

Secondly, but more briefly, I shall mention the fight against corruption. Although I am not suggesting that our overseas aid has to a large extent been misused in the developing world, it is a common perception that that might be so. There are undeniably too many examples of the misuse of power for private profit and large-scale corruption in some countries, involving the holders of public office and corporations. That tendency is on the increase.

The victims of that corruption are the poorest people--those who suffer most--because public resources are wasted instead of being used to meet their basic needs. The social fabric of their societies is undermined, accountable government is subverted and market competition itself is distorted. Obviously, grand corruption exists everywhere on the globe. It is shocking enough when we come across it in the north, but countries in the south and the east simply cannot afford it.

That is why I hope that the Government will give full support to a new organisation, which was established last year, called Transparency International. It is a non profit-making organisation registered in Germany. The support for that initiative has come from leaders in developing and industrial countries, from non-governmental institutions, from some multinational corporations and from foreign assistance agencies. It is a timely initiative, because in my opinion the fight against

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