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Mr. Norman Baker (Lewes): Does my hon. Friend agree that it is entirely wrong that the Department for International Development is not represented on the Cabinet committee dealing with biotechnology? Should not the Government correct that omission?
Mr. Breed: I am sure that the Minister will take that on board.
Miss Anne McIntosh (Vale of York): It gives me great pleasure to participate in this debate, as I have taken a great interest for months in the looming trade war. I am bemused by what I gather will be the Labour party's campaign slogan for the forthcoming European elections. Labour is talking about "Leading in Europe." This debate has shown that the Labour Government have woefully missed an opportunity to lead from the front in the EU on this matter--in particular, on food safety and our relations with third-world countries.
I wish to make a personal comment about the next motion on the Order Paper. The House will know that I am still a part of the Conservative group in the European Parliament, which is referred to in the motion. I have been called many things in my time, but I do not think that I have been called "complacent" before. Nor do I think that the word "antipathetic"--or, as the Spanish would say, "antipatico"--refers to me. I much prefer the word "sympathetic", or "simpatico."
My hon. Friend the Member for Christchurch(Mr. Chope) took a lead in showing that Conservative Members are much more in sympathy with the businesses
in this country that are concerned about the Government's lack of leadership, especially in the banana debate, and failure to give any reassurance to the Caribbean countries concerned, which are members of the Commonwealth.
There is clearly an uneven playing field for our producers. I am deeply concerned because the Government appear to be all over the place on foodsafety. My hon. Friend the Member for North Wiltshire(Mr. Gray) referred to the fact that the Government readily banned the sale of beef on the bone, without conclusive scientific evidence, yet still allow in imported pork that we know comes from animals fed on meat and bonemeal. A complete assurance has been given to the British public that none of the meat produced and sold here is from such animals, but the imports continue, and that is deeply worrying. The imports also place our producers in an uncompetitive position.
The failure to lift by 15 June the ban on US beef produced with hormones means that further sanctions will have to be negotiated. There will be 100 per cent. import duties on a wide range of products, including pigmeat, poultry and tomatoes, corresponding to the estimated $500 million loss of earnings for the US cattle men. Have the Government considered the impact on UK producers of pigmeat, poultry and tomatoes, especially in the Channel Islands? What compensation might be offered?
I pay tribute to Sir Leon Brittan, who has led the negotiations in Brussels. The Minister was right to say that the European Union will rely on scientific evidence. That is being considered as we speak. If there is conclusive scientific evidence--which I believe there is--that hormone-produced beef is bad, I hope that the Government will show some leadership for once in Europe and move to ban the imports.
I would find it difficult to explain to both producers and consumers in the Vale of York that beef imports will be allowed in even though we know that there is conclusive evidence that the meat can be damaging to health. The motion refers specifically to food safety, but we must also consider what unfair competition there may be for beef producers. We do not have many in the Vale of York, but they will be very badly affected.
I pay tribute to my noble Friend Lord Plumb, who for the past few years has chaired the parliamentary assembly between the African, Caribbean and Pacific countries and the European Union, especially when it meets under the auspices of the European Parliament. We owe a great deal to that body for its efforts to bring the two sides together, especially in the banana debate.
The ACP agreements, through the first Lome convention, considered sugar as a staple produce for many of the developing countries. We respect and admire the role that those countries play in the Commonwealth. Bananas are the only practical crop on which they can rely. We must not lose sight of the fact that the Canary Islands, within the European Union, produce the small, rather tastier and more delicate bananas that are preferred by the British consumer. I regret the fact that the Government have shown a distinct lack of leadership.
A wider trade war is looming. My hon. Friend the Member for North Wiltshire referred to the air freight agreement. It is most unhelpful that Ministers have found no time to meet the British companies involved. No
British or European Union carrier is given access to United States routes--known as cabotage--for either freight or passengers, or is allowed to buy more than 49 per cent. of shares. The Government should take the opportunity to consider the fly America policy, whereby any US Government official must by law fly only on an American carrier.
My hon. Friend the Member for Christchurch referred to the hushkits agreement. It was reached only on the basis of postponement for a year. There was a strong British interest at stake: we would have lost our Concorde flights to the US because the Americans refused to accept that their reconditioned aircraft are simply too noisy. Anyone living near or representing an airport with those noisy aircraft will understand the problem only too well.
There are problems with bananas, beef produced with hormones, genetically modified organisms, hushkits and air freight. I yield to no one in my support for free trade between the EU and third countries such as the US, and I regret the increasingly protectionist moves by the US Government in their economic relations with the EU.
I regret the fact that--contrary to the slogan that we will no doubt hear over the next three weeks, in the context of the European Parliament elections, that Labour is "leading in Europe"--there has been gross lack of leadership and the Government are reluctant to apply the right to ban hormone-produced beef, which is enshrined in law under article 36 of the original treaty of Rome.
Dr. Vincent Cable (Twickenham):
I make no apology for the fact that we have, for the second time in a short period, introduced a trade debate in the House. That reflects our recognition of how much our manufacturing and agriculture depend on an open trading system and the rule of law in trade; our concern about the threat posed by the current cycle of retaliation--there have been two major disputes--to large parts of our economy, including vulnerable constituencies; and our belief that the Government have a role and responsibility in the matter, because of our country's bipartisan tradition of support for liberal trade and because the Government, who, like previous Governments, are close to the Americans, can bring more influence to bear on the disputes than other European countries.
The issue is important, as the Minister acknowledged, and we are glad to have the opportunity to debate it. We begin to part company with him on the seriousness of the problems. The hon. Member for Vale of York(Miss McIntosh) captured very well the exact nature of the threats that we face. The Minister was right to say that there has been some scaremongering. Some have cried wolf, and whenever a trade dispute breaks out, some people prophesy the imminent collapse of our trading systems. The Uruguay round went through two years of trauma, but eventually the disputes were resolved.
It is possible to put a positive gloss on what is happening, but I urge the Minister to accept that the problems are serious, for several reasons, one of which is the fact the European Union and the United States, for very different reasons, are both behaving irresponsibly. The European Union is, to some extent, dragging its feet.
The hon. Member for Christchurch (Mr. Chope) accurately chronicled the history of the dispute. The foot dragging was partly for administrative reasons involving the slowness of getting 15 countries into line. There is also a highly reprehensible unwillingness to accept the rules of the dispute settlement procedures. That is unforgivable. On the other side, the United States, instead of waiting to see how the rules of dispute settlement can be implemented, rush in unilaterally, threaten sanctions, raise the temperature and make the problems worse. So there is blame on both sides, but it is a serious problem.
There is a deeper issue here. The international trading system now has to cope with more difficult and irreconcilable problems than those that faced early generations of trade policy makers. In the past, disputes were about tariffs and quotas. We are now dealing with something much more subtle--with what happens when, in opening up the trading system, we run into national health, hygiene or technical regulations. We are familiar with that in the European Union. Quotas and tariffs disappeared long ago, and there is now a long-established practice of harmonisation and mutual recognition to get over the problems. At global level, we do not have that framework.
It is easy to understand where the World Trade Organisation is coming from and why it tends to take a sceptical view of health restrictions. The classic case was Japan. The Japanese argued for many years that they could not possibly have imported beef because Japanese stomachs and intestines worked in a different way from ours. It was never clear whether they believed that scientific nonsense, but it was sustained none the less for many years. That provided the background to the somewhat sceptical approach to health standards that is often taken. The real danger is that genuine concerns about health are not taken sufficiently seriously. We are now seeing a generation of genuine health problems that have to be dealt with much more sensitively through international trade negotiations.
The underlying principle of international trade agreements is that they must be based on sound science. The problem with that is that it is a slogan. The slogan is right, but science constantly evolves, there is no settled scientific consensus and scientists in different countries say different things. Genuine public anxiety may not always be scientifically based. That is our difficulty in responding to the real issues of trade policy and the World Trade Organisation has not come to terms it.
My hon. Friend the Member for Eastleigh(Mr. Chidgey) rightly sketched out how we could extract ourselves from the beef hormone dispute, but a succession of other disputes is coming. It suffices for the purposes of this debate to sketch out the principles for handling disputes. The first is one with which the Government should feel comfortable because they are setting up a Food Standards Agency. The Minister of State, Ministry of Agriculture, Fisheries and Food is the architect of the agency. All major trading countries will have to have agencies independent of Government and the private sector to make credible scientific assessments.
A second principle is labelling. The Minister for Energy and Industry has sketched out the Government's commitment on labelling. It is surely a matter of fundamental principle that people should know what they are eating and make an informed decision about it. That may require a strict labelling regime. We have seen that,
in the case of GM food, that is not easy, but we must insist on it as a matter of principle. It is a principle that the Americans have so far resisted. So a combination of independent standards agencies, labelling--in some case, obligatory labelling, but often it can operate on a voluntary basis--and international agreement backed up by dispute settlement procedures is the basic ingredient for preventing disputes from getting out of control.
The Liberal Democrats have tried to press the environmental agenda over the years. One issue that is looming is the inability of the international system to enforce multilateral environmental agreements. My hon. Friend the Member for Eastleigh has already referred to that. There is no reason why such enforcement should not be carried out within a set of multilateral trade rules. Many people who believe, as I do, in a liberal, open, free trade system believe that the WTO can adapt to the problem and build a set of safeguards into the rules without enormous difficulty. I hope that the Minister will tell us that the Government are committed to the process and will take the lead in finding answers to the problem.
My hon. Friend the Member for South-East Cornwall (Mr. Breed) referred to the problems posed by developing countries. In the past decade, there has been a big change in the way in which the developing countries see trade. Until the mid-1980s, many of them, especially the biggest such as China and India, maintained largely siege economies. It is now generally accepted that that was contrary to their interests. Many of them have now embarked on liberalisation, which is welcome from both their standpoint and ours. There are barriers to the continuation of that process, one of which is the fact that the western world is often highly hypocritical. We demand market access to developing countries, but we present serious barriers to their products, especially agricultural and manufacturing items. The developing countries then ask why they should comply with demands for, for example, social legislation that could be used as a barrier to their products.
The concern of developing countries that is more relevant to the debate is that many demands for access are driven by narrow commercial interests. What my hon. Friend the Member for Eastleigh said about GM foods needs repeating. It may well be that in the long term, GM seeds will be beneficial to a country such as India. I have an open mind about it. Certainly 30 years ago, the introduction of new agricultural technology transformed the economies and agriculture of the Indian sub-continent for the better. Perhaps the same thing will happen again. However, there is a crucial difference between then and now.
Thirty years ago, agricultural research was carried out independently. For example, research was done at the rice institute in the Philippines. That provided confidence for Governments and private farmers to introduce seeds on a voluntary basis. That process will not happen for GM technology if it is forced through by western Governments at the behest of some of their corporate clients. If developing countries are to be helped to maintain a broadly liberal approach to trade, which is in their interests, it will have to be done in a sensitive way. The way in which the United States is approaching the matter is not helpful.
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