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Dr. Godman: What my hon. Friend says makes much sense, but may I point out that many of the small producers in the Windward islands, for example, are deeply concerned about the massive lobbying power that Chiquita and others have on Capitol hill? The Caribbean producers feel at a distinct disadvantage because of that massive lobbying campaign.
Mr. Bell: Of course. We have heard much tonight about the various brands--Chiquita and the rest. I am grateful to my hon. Friend for reminding me of the situation in the Windward islands of Dominica, St. Lucia and St. Vincent, where bananas provide over half all export earnings. In St. Lucia, for example, the industry contributes about 16 per cent of GDP. In St. Vincent and Dominica, the figure is 17 per cent. Notwithstanding that, over the past year, production in St. Lucia has dropped by 7 per cent. because of drought and poor prices.
I take up the point about the African, Caribbean and Pacific countries and the negotiation with the EU. It may be an appropriate time for the two sides in the convention to design a specific and long-term aid package for banana growers that reconciles the need of those producers to continue to export to the EU, and ensures that agreement is reached between the United States and the EU on the implementation of WTO rulings. We come back to the rulings and to resolution of the dispute on bananas.
When we talk about the conclusion of the Uruguay round, I am reminded of the terrible difficulty that the EU had with the United States in resolving agricultural issues. There was a conference at Blair House in Washington in the United States. There were huge demonstrations in Paris by French agriculture workers and farmers, yet the issue was resolved in such a way that the Uruguay round
could be signed. As we come up to 12 April, it is important for the EU and United States to resolve the issue of bananas in such a way that we can continue with our rules-based trade and with the type of conference that is to be held in Seattle, to which the Minister for Home Affairs and Devolution, Scottish Office referred.
It is interesting and significant that the United States declined to enter into a new Uruguay-type round. It wished to tie up all the fine pieces of string that had been left lying around after the Uruguay round. In the end, it agreed that there should be a new comprehensive round that took into account trade, the environment and other issues.
Therefore, the United States is making an effort in that area. That effort should be welcomed and commended, but this is the beginning of a series of major trade disputes. The question of beef hormones has been referred to. I understood from the hon. Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore) that genetically modified foods might be raised by the hon. Member for Lewes (Mr. Baker) before the evening is out. All that is significant and important. It means that the rules of the WTO become even more important.
The President of the United States has received telephone calls from the Prime Minister on the issue. The Secretary of State for Trade and Industry has made his views known. The Minister for Home Affairs and Devolution, Scottish Office has done so, and so will my hon. Friend the Minister for Trade, but I agree with the recent statement by the President of the United States:
Dr. Vincent Cable (Twickenham):
It is a great pleasure to speak in support of the excellent speech by my hon. Friend the Member for Tweeddale, Ettrick and Lauderdale (Mr. Moore). I do so from two standpoints. One is a constituency interest and the other is a long-standing interest in trade policy, particularly the current dispute, which has rumbled on in different forms for the best part of a quarter of a century.
The constituency issue is not textiles, unless it is well concealed in Twickenham. Other industries are affected. One in particular, the sweet biscuit industry, touches base
in south-west London. I have heard from the companies concerned about the problem, but the major issue is the fundamental one of principle that underlies the whole subject: the idea of the rule of law applied to international trade.
We should not underestimate the achievements of the early 1990s when the Uruguay round produced a dispute settlement agreement under the WTO. For the best part of 40 or 50 years, there had been semi-anarchy in international trade, with disputes being settled largely by force. Now we have a system of law. Independent panels apply the rule of law principle, which is of value, above all, to small and weak countries.
There have already been several examples of the system's value. In cases brought by Costa Rica, which is a very small country, and by Venezuela, the United States has been obliged, for example, to accept rulings based on the principles by which the World Trade Organisation disputes settlement panels operate. We should be concerned with upholding that principle. Both the major powers involved in the current dispute, in roughly equal measure, have done violence to that principle.
I do not think that it is helpful for us to be picking sides between the United States and the European Union. In their different ways, they have each added to the dispute and aggravated it. The United States has, for example, acted unilaterally, and the current case is not an isolated example. For a very long time, the United States has fallen into the habit of acting unilaterally and without warning in trade disputes. Throughout the 1980s, it used the so-called section 301 powers to bully countries into opening their markets.
The US's behaviour has been curbed somewhat by the World Trade Organisation, but its habits are still there. The US Congress has passed the Helms-Burton and D'Amato legislation, which are all about using power unilaterally to force other countries to open their markets. Its habits are now returning.
The European Union also has had serious faults. Although the hon. Member for Christchurch (Mr. Chope) was at the receiving end of some barracking in doing so, he was quite right in how he catalogued the way in which the dispute has evolved, and the fact that, for the best part of two years, the European Union has dragged its feet in implementing an international legal agreement.
There is a feeling--I am sure that some hon. Members will echo it in the debate--of some sympathy for the European Union, which is acting in the interests not of its own producers, but of producers somewhere else. However, we have to get the issue in balance. In many ways, I have some emotional sympathy for the Caribbean producers. In the 1980s, I worked for some time in the Commonwealth Secretariat and helped in negotiating the Lome convention, and I saw the force of feeling in the Windward islands about the vulnerability of their economies. However, I do not think that we should be over-sentimental about the issue, as there is another side to it.
The main banana producer in Latin America is Ecuador. Producers in Ecuador are not in large multinational plantations; they are small-scale peasant producers. Honduras is another major Latin American producer. It has just been devastated by a hurricane, in which the northern city of San Pedro Sul, the banana
capital of Honduras, was virtually destroyed. They are very poor people who are trying to earn a living in the world market. They, too, have legitimate interests.
I think that the European Union has been seriously negligent in not appreciating sooner the problem that has been building, and has been around for a very long time. In the mid-1970s, I worked for some time in the diplomatic service, in London, and the section that I headed dealt with Latin America. We were perpetually on the receiving end of missives from the Ecuadorian and other Governments complaining about the dollar-area quota, which discriminated against them. The reply that we always gave was that it was a temporary measure.
The British Government--the Colonial Office--had invested a lot of money in the Windward islands, and, having given them that aid, we could not abandon them. That was 25 years ago. Consequently, we went out to the Caribbean islands and talked to people at St. Lucia, Dominica, St. Vincent and the other producing islands, and agreed with them that they had to diversify. That was a quarter of a century ago.
Mr. Dorrell:
I have been listening with great care to the hon. Gentleman's comments; he is making a powerful case very well. His point on the alleged temporariness of protectionist controls is not unique to bananas, as the argument is used to justify almost every protectionist measure that is introduced. The "temporary" nature of the controls almost always proves to be much longer than people imply at the time.
"This dispute is not really about bananas, it is about rules.
As I have said, in terms of finance, the rules should be through the World bank and the International Monetary Fund. In terms of workers, they should be through the International Labour Organisation.
We cannot maintain an open trading system which is essential to global prosperity unless we also have rules that are abided by".
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