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Clare Short: I know that the hon. Gentleman is concerned about the environment, and anyone who wants change must accept the need for mutual recognition of multilateral environmental agreements. We need enough issues on the table for all sides to gain enough, so that they will move to get an agreement. We cannot get an agreement on new and complex issues without a broader round.
Mr. Horam: I do not agree with the Secretary of State. She used the word "complex" and these are very complex issues. The problem is that the capacity of many of these countries to deal with complex issues--which are made more complicated if they are expanded--is limited.As we know, the United States has 250 permanent
representatives in Geneva, while 35 countries have none. We need to build capacity if we are to deal with the complex issues.
In addition, it is not just a question of the capacity of the countries of the third world--it is also a question of their suspicions. The hon. Member for Hackney, North and Stoke Newington (Ms Abbott) said, rightly, that we have to look at the matter from their perspective as well as our own. The deal that those countries have got over the past 20 years as a result of successive trade rounds is not very good.
The World Development Movement has stated that 59 of the poorest countries of the world have seen their gross domestic product decline over the past 15 years. We are used to an ever-expanding GDP. We think it is a terrible problem if our GDP does not expand for two quarters in a row, whereas those 59 countries have seen a 15-year decline. When it comes to trade liberalisation, therefore, we have to address questions of trust and suspicion
One reason for the decline is the collapse in commodity prices, which has been a huge factor in depressing the standard of living in many third-world countries, and there are also political reasons. However, some trade liberalisation has contributed to the collapse in the standard of living in some of the poorest countries. It is not only the concept of trade liberalisation being put into practice that has presented them with difficulties, but the fact that it has not been well implemented. Some of the provisions for agriculture and textiles, which would have benefited the poorer countries, have not been implemented, but others, which damage them, have. Those poorer countries regard trade liberalisation with great suspicion and we have to take that into account.
No proper appraisal has been made of the consequences for the world of the previous trade rounds. As we know, the European Union, which is representing the UK in the rounds, has begun a process of appraisal. As it happens, it has been mainly done in this country and Manchester university has taken the lead in the research. However, what has been done so far is purely a scoping exercise and the real appraisal has yet to come. Despite that, we are talking about starting a further round in the next calendar year. We need a properly sequenced appraisal of the consequences of the last round to enable us to learn the lessons from it before starting the next round. It has been pointed out by hon. Members on both sides of the House that the existing discussions have not been open enough. That is not just a question of the relationship with civil society--although that is important, as several hon. Members have said--it relates to what actually happened in Seattle. I was not there, unlike my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who always seems to be at the big environmental dos. I wish I had his luck. The fact remains that many who were invited to the conference by the director general of the WTO found that they were locked out of the so-called green room, where 30 or so of the leading countries were holding the real negotiations. It is no wonder that the excluded representatives were reduced to thumping the table and behaving in a somewhat unmannerly fashion when they discovered the real situation.
I would plead for a more inclusive approach--and the Environmental Audit Committee would, I believe, take a similar line--which is essential, as well as a more measured approach. People say that we cannot turn back
the clock--that we must carry on. Why? Trade happens every day. Do we need to rush into something that could have serious adverse consequences for participants without thinking more clearly about the effects?
I agree with the hon. Member for Lewisham, Deptford (Joan Ruddock) and others about the advice that is being given to the Government as they move forward. I would like to see the conference on reform of the WTO actually taking place and being taken seriously. Who takes part and how participation takes place are both important. I should like to see the funding of increased capacity to take part in the negotiations being taken seriously and I welcomed the words of the Secretary of State for Trade and Industry about the Government's commitment to that.
The interface of the negotiations with environmental treaties should also be considered, and that can be done separately from the other discussions. For example, the multilateral environmental agreements, of which there are some 230 throughout the world, must be examined closely. The European Union, which is our negotiating arm, must take environmental questions more seriously than it has so far.
Mr. Stuart Bell (Middlesbrough):
I am pleased to follow the hon. Member for Orpington (Mr. Horam), with whose analysis of the early situation I entirely agree. In opposition, I was shadow Minister for Trade: I thought then that it was more appropriate to complete the Uruguay round before a new, comprehensive round was embarked on. That was also the view of the United States Government at the time.
However, a conversion on the road to Damascus--or Seattle--changed the US opinion, with the consequences that we all saw. The conference was ill prepared, and different nations had different agendas. For example, Japan and India were concerned about the US stance on anti-dumping, while the UK had an agenda towards the third world; the US had an agenda with regard to the common agricultural policy, and the European nations had an agenda of their own. No country had an agenda for itself, but all countries had agendas for other countries. It was not surprising, therefore, that the talks collapsed early.
The hon. Member for Orpington mentioned the green room discussions that took place towards the end of the conference. I agree with him that many countries did not attend the talks because they could not afford to go. However, until the green room talks, the fact that meetings were split between four groups of countries meant that all countries attending had an opportunity to take part in the discussions. The problem was that all countries had a set agenda from which they were not prepared to move. The conference collapsed because most of the member states attending thought that that was preferable to reaching agreement. That does not augur well for any future round of talks.
The hon. Member for Orpington also made the interesting point that, after all the trade round discussions held over many years, the gross domestic product of 59 countries had fallen. However, as he noted, the collapse of commodity prices demonstrated that other economic forces were at work. Those forces impinge on the development of free trade but are related neither to the conference at Seattle, nor to the World Trade Organisation.
I was highly impressed by my right hon. Friend the Secretary of State for Trade and Industry, not only for his speech today but for his conduct at the discussions and negotiations in Seattle. I continue to follow trade matters, especially in the European context, and many observers from outside our country who were at Seattle have commented on my right hon. Friend's performance.
My right hon. Friend spoke of trade liberalisation into the 21st century. We should be grateful for small mercies--in this case, the fact that he did not talk about trying to lay down a trade policy that would last through the next millennium. Instead, he was content with a policy for the next 100 years.
I am grateful to my right hon. Friend the Member for Chesterfield (Mr. Benn) and to my hon. Friend the Member for Hackney, North and Stoke Newington (Ms Abbott) for ensuring that the case of poor countries has been heard today. However, after what happened in Seattle, all nation states, rich and poor alike, will feel the need to move forward on a number of fronts in the face of increasing globalisation.
When we consider Seattle, we need to get the context right. My right hon. Friend the Secretary of State was right to point out the significance and importance of trade for the United Kingdom. We are the fifth largest exporter of goods and services in the world: 25 per cent. of our GDP takes the form of exports, and 5 per cent. of all world trade emanates from the UK. We must not overlook those facts.
The Labour party has always said, in opposition and in government, that it believes in the goal of fair and balanced trade under the auspices of rules-based organisations such as the European Union and the WTO. The rules of the WTO appear to have worked effectively, and its disputes panel has done its job. Although we in the European Union may be unhappy that rulings on banana importations--referred to by my hon. Friend the Member for Hackney, North and Stoke Newington--and on hormone-treated beef have gone against us, it should be noted that the WTO has also found against the United States on behalf of Venezuela, Brazil and Costa Rica.
The hon. Member for Tiverton and Honiton (Mrs. Browning) listed earlier a number of sectors in our country which have been penalised as a consequence of the WTO's decision on banana importations. As a result of a debate in this House and the representations of the Department of Trade and Industry, the cashmere industry was removed from the list. The combined consequence of events in Seattle, the disputes panel and the fact that no overall agreement was reached is likely to be more skirmishing rather than a trade war.
The hon. Member for Twickenham (Dr. Cable) made an impressive and cognisant speech. He clearly knows his subject well--he even knew that the WTO had bowed to Costa Rica. The United States has lost cases before the disputes panel. The right hon. Member for Suffolk,
Coastal (Mr. Gummer) touched on that in his speech, saying that it was surprising how much power we had given away to the World Trade Organisation. The hon. Member for Twickenham also mentioned that.
What do we want? Do we want to deal with a rules-based trade organisation? Do we want to withdraw our ambassador when we have a trade dispute? Do we want to send in a gunboat, as we did in the last century? Or are we willing to submit our disputes to the World Trade Organisation and the disputes panel? We have to live with the fact that the WTO is rules based and has a disputes panel, and we should accept its rulings.
My right hon. Friend the Member for Chesterfield referred to workers' rights. They were, and should be, at the heart of the programmes for the WTO. The essence of the former general agreement on tariffs and trade was that nation states would recognise that the economic endeavours in their trade relationships would be a quest to raise living standards. Trade deals and trade organisations count for nothing if they do not raise the living standards of people throughout the world. The essence of GATT, which has been passed on to the World Trade Organisation, is that an effort should be made not only to raise living standards but to ensure full employment, built upon the development of the world's resources by expanding the production and exchange of goods.
Workers' rights are extremely important. The hon. Member for Tiverton and Honiton spoke about child labour, as did the right hon. Member for Skipton and Ripon (Mr. Curry). We should not be afraid to look at the issue. My right hon. Friend the Secretary of State referred to a conference at INSEAD, just outside Paris, where they discussed bringing in the International Labour Organisation, the World Trade Organisation, the United Nations and the World Bank to examine workers' rights. My right hon. Friend the Secretary of State for International Development said, quite rightly, that they should run in parallel--the ILO should look at workers' rights and the WTO should look at trade matters. If we work along those lines, we should reach a consensus.
My right hon. Friend the Secretary of State for Trade and Industry also mentioned tariff-free reimportations from less developed countries. That proposal has been put to the European Union. I hope that it will be put to the conference on 15 December between the United States and the European Union.
I could have wished for more time in which to speak in this debate, but I want to allow as many of my hon. Friends as possible to speak. After Seattle, there may be a mountain to climb on the terms of a new negotiating round, on the so-called inbuilt agenda, on accessions such as that of China and on the business of applying the rules transparently and consistently to all. It is said that faith can move mountains--that, of course, is not the case. I am grateful to my right hon. Friend the Member for Chesterfield, who twice referred to the deity in his speech.
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