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Mr. John Randall (Uxbridge): I pay tribute to the work that the Secretary of State's Department is doing. On broken states, she will doubtless be aware that there are more than 700,000 registered refugees and displaced persons in Yugoslavia, Serbia and Montenegro. What can we do within our own continent to try to ameliorate that situation?

Clare Short: The hon. Gentleman is right, and programmes are in place in all former communist countries to help them make the transition to a democratic market economy. Of course, such countries have to adjust their systems of government. We are trying to bring stability to the Balkans by helping the countries concerned to build up their systems of government, so that they can grow their economies, care better for their people, and get refugees resettled. We are committed to all those tasks, and we are working as effectively as we can to achieve that objective.

The question arises of the suffering of those who originate from Serbia and Montenegro, but the pressure of refugee movements from eastern Europe to western Europe has played into the hands of those who have tried to incite far right, racist politics in western Europe by putting the blame on the many refugees who have settled there. Doing what is right and doing what is in our self-interest are not in conflict they are entirely complementary.

On present trends, Africa is getting poorer, and much greater efforts must be made to help—a point to which I shall return shortly. In the past five years, we have worked hard to improve the effectiveness of the international development system, which is full of conferences and grand declarations. If even a minor proportion of the declarations made and agreements reached at various conferences had been implemented, the world would be in better shape. We have tried to hone the international system, so that its objectives can be focused on much more clearly, and to secure collaboration with the World Bank, regional development banks and the UN system. That is preferable to the funding by various organisations of lots of separate initiatives and projects, which uses up much of the administrative capacity of the organisations themselves, and of the Governments whom they seek to support.

We have made considerable progress. Our first White Paper made it a target to get the international system agreed so that we could all work together to implement

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the international development targets. At the millennium assembly—which was attended by more Prime Ministers and heads of state than had ever before assembled for a single event—the world agreed to seek to secure the millennium development targets, as the international development targets were renamed.

One of those targets is to halve, by 2015, the number of people in the world measured as living in extreme poverty in 1990. Meeting that target means that 1 billion people will have to make the journey out of extreme poverty. Other targets include getting all the children in the world into quality primary education, and reducing infant, child and maternal mortality. The latter requires improved health care systems and that people have access to clean water and better nourishment.

Last weekend, my right hon. Friend the Chancellor of the Exchequer and I attended the spring meetings of the World Bank and the International Monetary Fund. We have ensured that both organisations are focused on seeking to deliver those targets in countries around the world. They are also focused on measuring the reform programmes that they recommend to developing countries against progress towards the targets that have been set. Where once there were mixed messages and differing objectives, the measure of economic reform is now the systematic reduction of poverty and the provision of better services for people.

That is a very important consensus, and it is a new departure for the world. Historically, there have been lots of clashes between the World Bank and the UN system. Nowadays, there is much more collaboration and effective working together.

At Doha, we achieved agreement on the very important proposal that there should be a new round of trade negotiations to deliver better trading opportunities to developing countries. If we can deliver on that agenda, the result will be much fairer world trading rules.

Fairer trading rules will give developing countries a much better chance to grow their economies. Of Africa's total exports, 70 per cent. consists of unprocessed commodities. The payment that countries receive for such commodities is very low. Most of the added value for commodities such as cashew nuts, tea, coffee and chocolate is added on in Europe. As soon as African countries start to try to process some of those commodities they hit all sorts of tariff walls and escalations. On chocolate, for example, those tariffs and charges add up to 100 per cent. of the original cost.

The present trade rules almost amount to a conspiracy to keep Africa underdeveloped. Better trading opportunities will give African countries a better chance to grow their economies and create jobs. At Doha, we agreed a framework to deliver those better opportunities, but the task of ensuring that they are delivered will be considerable, and will require much attention.

Dr. Jenny Tonge (Richmond Park): I wholeheartedly agree with what the Secretary of State is saying, but how does she intend to get developing countries better represented in the World Trade Organisation? Time and

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time again, those countries are failed by their lack of representation, and their lack of capacity and expertise in these matters.

Clare Short: The hon. Lady is right. We need improvements, but some of the criticism of the WTO at the time of Seattle was terribly misinformed. The WTO was born out of the most recent Uruguay round of trade negotiations. With its inception, the world moved forward to adopting a trade system based on rules and membership. Before that happened, the big trading blocs negotiated with each other in such trade negotiations, and the developing countries tended not to have a strong voice. Although it was of course right to bring down the protectionist barriers erected in the 1930s, the result was that developing countries were squeezed out of the negotiations.

Since the WTO was established, more than 140 countries—including China—have decided to join. Developing countries, therefore, make up the majority of the WTO's membership. That creates the possibility of them getting together and negotiating as a group, and thereby getting more fairness into international trade rules. That is how we got to Doha, but the problem remains that some of the poorest countries do not even have an ambassador in Geneva. We and other countries are working with the Swiss to set up a secretariat for those countries—an organisation with pooled resources that will enable them to be properly represented.

In addition, the UK has taken a leading role in the establishment of what might be considered a type of law centre, giving developing countries access to advice from trade lawyers. Such lawyers tend to be enormously expensive, but we now have a joint facility giving the poorest countries proper legal advice, and that helps them to exercise their rights under WTO rules.

My Department also has a considerable programme of working with UNCTAD—the UN conference on trade and development—and others to strengthen developing countries' negotiating and trade analysis capacity so that they are more able to be clear about their self-interest and negotiate their self-interest in all trade negotiations. Trade has become enormously complex, yet it is crucial for the chance to grow economies. So we are making a lot of progress in that field.

I was very impressed in Doha by the performance of the developing countries. The countries of Africa moved together. As Latin America, Africa, Asia and the Caribbean have shared as well as different interests, they need to pool their interests and negotiate together to secure more from the OECD economies. That will involve us in reforming the common agricultural policy, which we would welcome, but is also important in the interests of developing countries.

Ms Julia Drown (South Swindon): I wonder whether capacity is also relevant to debt relief. The early-day motion with the most signatures calls for more and faster debt relief. Is it the case that some of the poorest countries do not have the capacity to argue their side, which may be holding them back from getting more debt relief? I am thinking particularly of commodity prices—the analysis has not been strong enough to get the message through so far.

Clare Short: My hon. Friend is absolutely right. When the debt relief process started, many countries did not

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even know what they owed. There were bundles of bills in their central banks and a lot of work had to be done to tidy up and build the capacity for countries to manage their debt. We are engaged in work to build up countries' debt management capacity. It is quite right that countries should borrow responsibly and take out loans, but they need to manage their debt and ensure that they can afford to repay it.

I think that 26 countries have now qualified for heavily indebted poor countries status. Sierra Leone has just qualified, which is very good news. It is about to have elections and there are police across the country, which is a welcome development. However, there is a problem with the HIPC initiative. It had a formula for how much debt a country could afford in relation to earnings from its exports. Because commodity prices have dropped considerably and oil prices have gone up, many countries such as Uganda, which had already exited, are no longer sustainable under the formula. That was a matter of discussion at the World Bank meeting at the weekend. We will have to find extra resources for many countries to achieve sustainability. That is another argument for opening trade access. If countries are dependent on the export of a few commodities and prices fall, their economic development is called into question. All the countries that have been through the HIPC process have been helped to manage their debt for the future so that they do not get into these difficulties again.

The other very important meeting that took place a short time ago was the UN conference at Monterrey on financing for development. There was remarkable consensus between OECD and developing countries about the best kind of reform in which to grow economies to reduce poverty. It really is an extraordinary change since the days of the cold war. In the past, developing and developed countries would have found contentious, ideas such as encouraging the public sector to grow, having effective governance, regulating an economy responsibly and having better public services that are universal, but today there is agreement on the reform agenda across the world. That was one of the things accomplished at Monterrey. Again, there was a focus on implementing measures, not on arguing about what constitutes a desirable reform agenda.

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