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6.27 pm
Mr. Tom Clarke (Coatbridge and Chryston): Last year at this time, during a similar debate on the Queen's Speech, some of us spoke against the backdrop of the
global economic crisis. It was a deeply worrying time. The integrated nature of a modern global economy meant that the shocks in Russia and Asia had a real impact, especially in terms of investment and jobs, on us, too, in the United Kingdom.
Since the height of the financial instability in September 1998, the Government and many other Governments throughout the world have taken decisive action by putting in place new long-term disciplines--indeed, a new financial architecture--to promote greater economic stability throughout the world.
Significant progress has been made. Reform, based on transparency and accountability, has begun to restore confidence in the stability of the global economy that was lost over the past couple of years. Growth prospects across the world, based on sound foundations, are now substantially better than they appeared even a few months ago.
Only last week, China agreed to a package of trade liberalisation measures that will provide even greater trade opportunities to the west. The opening up of the world's largest potential market is, of course, welcome, but those opportunities should not be reserved solely for the west and the other countries in the developed world. Those opportunities should be available to all, particularly those in the developing world, many of whom feel left behind in the rapid development of the global economy.
Plainly, past policies on trade and investment have been accompanied by increasing disparities between rich and poor, both between and within countries. True, there has been a huge growth in global wealth and consumption, which we welcome, but that does not tell us the full story. Many within developed countries have bathed in the fruits of the new global economy, but millions upon millions of people today live in avoidable poverty, in part because of their inability to develop their economies. That remains a major international challenge, and a challenge to us all. We simply cannot continue to live with a situation where, globally, 20 per cent. of the world's people in the highest income countries account for a massive 86 per cent. of total private consumption expenditure, and the poorest 20 per cent., a minuscule 1.3 per cent.
The facts are simply devastating and I am glad that they are being addressed in the Queen's Speech as well as in the Government's approach to the global economy. That is necessary. The least developed countries have seen their share of exports decline to a tiny 0.4 per cent. during the past 20 years, while, on the other hand, the United States and the European Union, containing roughly the same number of people, account for nearly 50 per cent. of the world's exports. We cannot, in all conscience, allow that trend to continue unchallenged, and I am glad that the Government see the need to respond. That is why I am genuinely delighted that the Chancellor in particular has acted on those appalling statistics. The debt relief measures initiated by the Government have, for me, been the highlight of their term so far, and they deserve to be warmly congratulated.
I am sure that the Chancellor would agree that there is no room for complacency. In the New Statesman recently, I wrote:
As the House will know, one of the main problems in the past has been that policy making has been fragmented, and organisations such as the International Monetary Fund, the World Bank and the World Trade Organisation, have often operated with separate agendas. Some of us have long argued that the international bodies responsible for global financial supervision should work together more effectively.
We all look forward to next week's WTO ministerial meeting in Seattle, and the Government have our support when pressing for a new initiative led by the World bank and the WTO, involving the IMF, to ensure more and more effective trade-related assistance to developing countries, and to improve coherence in global economic policy making.
The closer relationship between those bodies in responding to the needs of the poorest and most vulnerable is a hugely important development in its own right, and provides a strengthened opportunity to make a real impact on complete poverty eradication. The Seattle ministerial conference presents a key opportunity for our Government--one which I believe that they will grasp--to take a lead in shaping trade regulations to the benefit of the many in the third world. Ministers' decisions will have significant implications for poor people whose lives are increasingly affected by multilateral trade rules and commitments. It is therefore vital that, among the many areas of debate, there is a real and proper focus on the relationship between trade and development.
I passionately believe that the trend towards rising inequality and marginalisation of the world's poorest people and countries from the benefits of international trade must simply be reversed. I believe, too, that the real challenge for the WTO is to design international trade rules so that they contribute to sustainable development and generate benefits for the world's poor. Therefore, I particularly welcome the call made by my right
hon. Friend the Secretary of State for International Development for the forthcoming negotiations to have that development focus, especially when we consider that developing countries account for four fifths of WTO members.
Many poor countries feel that the Uruguay round--the previous big trade round--has brought them few economic benefits and has left them struggling to catch up with the developing world. It is there that we must be seen to be offering hope, inspiration and a practical response to the demands that exist. Economic liberalisation can have a positive impact on economic growth, but where it is carried out too quickly, or without a proper understanding of economies, the results can be negative--the opposite of our worthy intentions.
Mr. Paul Tyler (North Cornwall):
It is now 25 years since I was first elected to the House, although I immediately acknowledge that you, Mr. Deputy Speaker, and other hon. Members, have had a much more distinguished and continuous service to the House. It is tempting to look back to see how little seems to have changed. In 1974, the Conservative party was spectacularly split over Europe, so nothing has changed there. The larger group was then sane, but the lunatics have taken over the asylum, as I think that the right hon. Member for Huntingdon (Mr. Major) would now acknowledge. Similarly, the term "sleaze" had not been invented 25 years ago, but there was a feeling that the Tories had gone stale in office. We all know what happens to a product that goes stale--it starts to smell unpleasantly. Although the sleaze was not of Archer, Hamilton or Ashcroft proportions, it was nevertheless serious.
"Fundamental to the whole package are the contributions of the USA . . . the Republican dominated House of Representatives may not agree to President Clinton's request for funds for debt relief."
24 Nov 1999 : Column 666
Sadly, since I wrote that article, we heard only last week that that is precisely what has happened. I know that the House, and particularly the Chancellor--I am glad to praise him in his presence, as I did in his absence--will agree that the Government should continue to work with the United States and President Clinton to resolve this unfortunate impasse. Progress is being made, and the Chancellor will know that he has the support of the House in his efforts to obtain relief for the debt crisis which he has so courageously addressed since taking office.
Trade, in tandem with debt relief, can be a powerful tool in combating poverty and aiding development in the poorest countries, because investment in the developing world is crucial in promoting the economic growth that is needed to eliminate that unacceptable poverty. Until the world trade playing field is levelled out for the benefit of developing countries, I fear that spectacular achievements on debt relief will simply be tarnished. For that to take place, developed countries must also understand the practical problems that developing countries face. I strongly believe that it is up to the developed world to take a lead in improving market access for those developing countries. Consistent with that, I am pleased that the EU has proposed committing more resources to improve the market access for developing countries to take advantage of trade opportunities and participate fully in the world economy. That is as it should be.
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