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Mr. Battle: I would suggest that, economically speaking, the term "mercantilism" might apply better to the problems that he has raised, but I, too, defer to the Table Office's judgment on the use of language. However, we must remember that, if we constantly heighten the language, we make diplomacy harder. We should look for common points of contact on which we can build a world trade system that enables the vast majority of the substantial trade and investment flows to proceed fairly between us.
Disputes are rare and, without wanting to minimise their individual importance, I have to say that there is a danger that if we over-emphasise them, we risk discolouring the overall relationship and jeopardising the future. It is possible for trading partners to resolve differences if there is a willingness to work patiently towards practical solutions. It is all the more important to do that when the two trading partners are the European Union and the United States, not only because of the massive and dynamic bilateral trading relationship that exists between us, but because of the impact of that relationship on the development of the world trading system as a whole.
Mr. Christopher Chope (Christchurch):
We welcome the opportunity to debate United Kingdom trade policy and the World Trade Organisation, and we agree with many of the constructive sentiments expressed by the Minister. We deplore the woolly wording of the Liberal Democrat motion, and some of the scaremongering and irresponsible statements by the hon. Member for Eastleigh (Mr. Chidgey), which disclosed some of the muddled thinking that we have come to expect of the Liberal Democrats. I have read the motion on the Order Paper for the second half of this afternoon, and if this is supposed to be an example of how the Liberal Democrats hold the Executive to account, it carries about as much punch as a bowl of overcooked noodles.
When the Minister said that the original wording of the motion made reference to American food imperialism, the hon. Member for Eastleigh said that he thought that nonsense. I was in the House this time last week, when the Leader of the House announced that this afternoon there was to be
If the references to American food imperialism were meant to be the soundbite that would motivate plenty of people to vote for the Liberal Democrats in my constituency last Thursday, which was polling day, it manifestly failed, because the Conservatives were returned in 36 of the 44 district council seats, gaining no fewer than 13 seats from the Liberal Democrats and reducing their number in my constituency to a mere five.
Conservative Members recognise and support the importance of the World Trade Organisation as a body committed to promoting global free trade and the reduction of trade barriers. We, as a global trading nation, have more to lose from protectionism and trade barriers than does any other member of the European Union. I think it fair to say that some of our European partners are instinctively more protectionist than we are, and given attitudes to British beef exports, too many European Union countries have shown a willingness to appease protectionist lobby groups rather than defend the virtues of open markets, sound science and the leadership of the World Trade Organisation.
We last debated this subject on 22 March 1999, before the World Trade Organisation's April ruling on the banana regime. During that debate, I and several other hon. Members asked the Minister a series of questions about what would happen if the World Trade Organisation endorsed the United States' trade sanctions against the EU for failure to comply with the WTO rulings on bananas. We did not receive any answers, and we now realise why. It is obvious from what has happened since that the Government had failed to ensure that the European Union drew up prudent contingency plans. The consequence is that the legally authorised WTO sanctions, amounting to $131 million a year, are now in place, and several United Kingdom niche businesses are suffering very seriously as a result.
What action are the Government taking? What is the European Union doing? If ever there was an issue that demanded immediate answers from the Government, it would be this one. It is a pity that the Liberal Democrats did not even mention that in their long-winded motion.
On 29 April 1999, I tabled a question to the Secretary of State for Trade and Industry, asking on what date he expected the European Union to introduce a banana regime that was in compliance with the ruling of the World Trade Organisation. By 11 May, following a holding reply, I received the answer. It is a matter of great regret to Opposition Members that, on an issue of such sensitivity, it took the Secretary of State the best part of a fortnight to reply to such a question. The reply, from the Minister for Trade, said:
When the Conservatives were in government and the Minister of State, Ministry of Agriculture, Fisheries and Food, the hon. Member for Birmingham, Perry Barr(Mr. Rooker), was an Opposition Member, Secretaries of State were several times found by the courts to be acting unlawfully. The hon. Gentleman was very quick to say how appalling that was, and to say that the Government should immediately comply with those rulings. That is a perfectly legitimate line to take; compliance with the rule of law is fundamental to any regime that commands respect.
The WTO has made its ruling and the European Union is saying, "We shall comply, but we are not quite sure when." In the meantime, sanctions against innocent firms in the European Union are biting. This is not an academic debating point. As we speak, the sanctions are costing British jobs and successful British businesses. So far, the Government have given all the appearance of being pretty indifferent to the plight of those businesses.
On 11 May 1999 the Minister for Trade gave a written answer to my question, tabled on 29 April 1999, containing his estimate of the number of jobs put at risk by the trade sanctions of the United States authorised by the World Trade Organisation:
One such firm, to which I drew attention in oral questions last week, is called Beamglow. It had invested heavily in the US market--about £2.5 million. It is quite a small business, employing only 100 people. About25 per cent. of its turnover is with the United States, and it has lost all that business as a result of the sanctions. The firm has communicated with Ministers, but has had no satisfactory response.
When I raised the matter with the Secretary of State in oral questions last week, he made it seem as though it was everyone else's problem but his. He said that
"a debate entitled 'American Food Imperialism and European Trade Policy'."--[Official Report, 6 May 1999; Vol. 330, c. 1089.]
I presume that that title was not invented by the Leader of the House, but emanated from the Liberal Democrats.
"It is unclear how quickly the European Union can amend the banana regime to bring it into compliance with the ruling of the World Trade Organisation. The Council has asked the Commission to provide proposals by the end of May. However, the forthcoming elections to the European Parliament are likely to delay their approval of a new regime until at least September. In the meantime, we are pressing the Commission to find an interim arrangement which could be agreed quickly and which would displace US retaliation against EU industries."--[Official Report, 11 May 1999; Vol. 331, c. 84-5.]
What a farce; what a state of affairs. Anyone would think from that reply that the World Trade Organisation ruling or the date of the European elections came as bolts from the blue. All along, the European Union approach has been one of indecision, prevarication and delay--of hoping that the problem would go away. It did not go away, and when the European Union was confronted with the decision and the authorisation of the World Trade Organisation, it gave all the appearance of having made no arrangements to deal with it. It is now claiming the European elections, the chaos in the European Commission and various other factors as explanations for not addressing the issue with greater urgency.
"In terms of the historical levels of exports to the US in each sector, it is not possible to say what the overall impact on British jobs might be. Much depends on how long the retaliatory measures
13 May 1999 : Column 450remain in place, the ability of affected businesses to find alternative customers for their products, the extent to which orders have been brought forward before these measures took effect and local market conditions."--[Official Report, 11 May 1999; Vol. 331, c. 85.]
That may well be correct, but it ignores the fact that, as the Minister knows, many niche firms very much depend on their export trade to the United States, and they have lost business which they cannot replace in other markets.
"the real solution is to resolve the trade disputes."
Fine.
"The Government are committed to achieving that long-term solution to the problems."
Fine.
"The solution to the problems that companies such as Beamglow face lies in the Government using our best efforts to ensure that the trade disputes with the United States are resolved"--
fine--
"and that free trade and commerce are able to flourish."--[Official Report, 6 May 1999; Vol. 330, c. 1072-3.]
But what will happen in the meantime? By the time the dispute is resolved--the Minister for Trade estimates that that will be no earlier than September, and some people say that it might drag on beyond the turn of the year--Beamglow will have been obliged to lay off a very significant number of its employees.
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