Examination of Witnesses (Questions 140
- 159)
TUESDAY 6 DECEMBER 2005
MR ROGER
LIDDLE
Q140 Hugh Bayley: One of the areas
where the EU appears to be the most vulnerable in its offer is
in relation to "sensitive products", where I think you
are proposing that 8% of tariff lines could be so designated.
The World Bank told us in Washington DC a couple of weeks ago
that if only 2% of products were so designated, 90% of everything
that the rich world wanted to protect would be protected. Really
there must be some change there. Will there be a numerical limit
on the number of products that the EU Member States, or any states,
could designate as especially sensitive? Will there be a requirement
for some tariff cuts, if not the steep tariff cuts, for such especially
sensitive products?
Mr Liddle: I recognise on the
face of it the naming of 8% of agricultural tariff lines of sensitive
products looks as though the EU is basically offering something
with one hand and trying to take it away with the other. I think
Peter believes that the Commission has to better explain what
it has in mind when it talks about sensitive products and, of
course, the whole package is for negotiation at the end of the
day. The point that you raise that is crucial is that I think
a lot of people think when we say 8% sensitive products, that
means that we will maintain the present levels of protection that
we have on those 8% sensitive products. That is not the case.
We are not going to maintain the present levels of protection.
For each of these tariff lines we would negotiate a Tariff Rate
Quota, a TRQ. That means that there would be a tariff applied
to these sensitive products. It would be a lower tariff than presently
applied but a higher tariff than it would be under the general
formula. A quota would be fixed for how much could come in at
that special tariff. This is all to be negotiated, line by line,
once you have got general agreement on the tariff structures.
I would emphasise that these are matters for negotiation, so there
is quite a lot of give and take in future in this area that would
be likely.
Chairman: That is a good introduction
to John Battle's question.
Q141 John Battle: I think in the
context of the general conversation and lowering expectations,
if you are going to get to it line by line it is going to take
some time even if you get an agreed tariff structure. This is
going to take a long time. One of our witnesses suggested that
Hong Kong was a rushed event because the preparation had not really
taken place, in effect there had not been enough focus and consensus
building around key proposals and, therefore, we could not expect
too much to come out of the Round. At Cancún the Commission
was criticised for playing a game of last minute brinkmanship
right up to the edge of the final days in the WTO negotiations.
I wonder whether in the present context there is a calming down
and a longer look now not to expect too much in Hong Kong but
to set some frameworks that will be running, or do you expect
some rabbits to be drawn out of hats in Hong Kong? As an adjunct
to that, how does the Commission avoid the Americans blaming Europe
if things do not work out productively?
Mr Liddle: That is a very interesting
set of questions. The EU has been at the front foot of these negotiations,
in my view, throughout. After all, it was the EU in July 2004
when Pascal Lamy was still there that made the offer conditionally
to phase out export subsidies. That was an important move which
got no reciprocation whatsoever for a long time from the other
rich countries of the world. As I say, there was a pause because
of the change of Commission and the change of US trade representative.
From the start, Peter always recognised that we had to make progress
on agriculture. This was a very difficult subject for Europe because
we know all the different political pressures within Europe on
the Common Agricultural Policy but we had to make progress on
agriculture. We agreed the conversion of ad valorem tariffs
in May, we reached a compromise tariff structure in China in July,
and we were waiting all the time for the United States to make
a comparable move to ours that had been made in July 2004. We
had to wait quite a long time for that, partly because the whole
focus of the administration was on getting the controversial CAFTA[5]
bilateral trade deal through Congress rather than on the Doha
Round. Then the Americans did turn to Doha and they made an offer
on agriculture which surprised a lot of people by the boldness
of its details, it was certainly a public relations triumph. We
deliberately decided not to blow that offer out of the water.
We could have done because it contained elements that were very
unspecified, for example, although they are saying they are going
to cut overall domestic support for agriculture they are not saying
how, and there is no commitment to remove the price related supports
for agriculture which are a key feature of the American agriculture
farm system, in particular something called Counter Cyclical Payments.
There is no commitment to do that. It is very, very difficult
to see how in practice you could contain your agriculture subsidies
within a limit if at the same time you do not support the regimes
which effectively imply open-ended public spending commitments,
which is the case with the Counter Cyclical Payments. We could
have made an awful lot of that but we did not because we wanted
to get the negotiations going. We made a counter-offer on agriculture.
You know all about how difficult it was to get the EU25 into a
position where that was agreed, but we managed to do that. We
managed to rally support for that in the Council of Ministers,
and that was good. What we were hoping was when we had made our
countervailing agriculture offer on tariffs then the Americans
on the one side and the Brazilians on the other would get into
a serious negotiation with us, but instead what happened was they
said, "Oh, this is just completely unacceptable. We are not
prepared to talk about this at all" and it created exactly
the wrong reaction in Europe, as far as Peter was concerned, to
the one that we needed because the consensus in the Commission
and the Council of Ministers was, "If they are going to behave
like that and say Europe is not offering anything significant
when we actually think Europe has offered something really significant,
we are not going to do anything more until these other people
realise we have got to get into a serious negotiation here".
It hardened the position in Europe and the reaction in the rest
of the world. I think that Europe's position on this agriculture
offer is pretty strong. The maximum tariff cut of 60% is much
bolder than anything we have done before. It is also the case—this
is a point that the competitive agricultural producers, both the
rich countries like America and Australia but also the Brazilians,
will not accept—if you cut agricultural tariffs too radically,
too fast, then some of the biggest losers will be the very poorest
countries who get access to our markets through preference schemes
because you will be cutting back the preference that they have.
They just will not accept the validity of this argument but I
think it is one that we have got to make very, very strongly at
Hong Kong.
Q142 Richard Burden: Could we just
go back to the description you were giving a little earlier on
in answer to Hugh about the two stage process of an agreement
and a framework but then moving on to more detailed line by line
negotiations, whether it be on special and differential treatment
on one side of the equation or sensitive products on the other.
Just thinking in terms of the collective psychology of Hong Kong
and the process, that could sound very easily to developing countries
like you are asking them to write a bit of a blank cheque in practical
terms. There is a promise there, but what is behind the promise?
Would you recognise that would be a likely fear and, if so, how
could you allay that fear? What could you build in to show that
was not just asking them to write a blank cheque?
Mr Liddle: I think that is a very
real concern and certainly the Indian Trade Minister, Kamal Nath,
does say, "I cannot agree any figures on tariffs until I
know how my sensitive products are going to be dealt with".
That is an understandable point of view. I think the only way
you can proceed on this is on the principle that nothing is agreed
until everything is agreed. I think you have got to agree the
main outlines of your tariff structures and their cuts first and
then address how you deal with all the exceptions and the timescales
and the sensitivities and all the rest. I do not see how you could
deal with the sensitivities first without having at least some
provisional view of what the actual percentage cuts for the generality
would be. Logically, I think you have to do the percentages first
and then the exceptions. I do think that is an issue and perhaps
what we need to do more is try and establish the trust that we
are not going to promise lots of sensitivities and then in the
detailed line by line negotiation after the tariff cuts have been
agreed refuse to deliver on that promise. I think we have got
to try hard to establish that trust.
Q143 Mr Singh: Roger, before I ask
my intended question, I would just like to reflect on this grand
bargain a little bit where the rich want access for goods and
the advanced developing countries will get greater agricultural
access to rich markets. In a case like India, which presumably
is an advanced developing country now, my understanding is they
are not a net exporter of food apart from rice, so what incentive
is there for them in this grand bargain?
Mr Liddle: Again, that is a very
good question. India is not an agricultural exporter, you are
quite right and, indeed, the Indian Trade Minister is very, very
concerned about agricultural tariff cuts that would lead to more
food imports into India and very, very concerned about what effect
this might have on the stability of the Indian countryside. Although
we describe India as an advanced developing country we must always,
always remember that there are more poor people in India than
in the whole of Africa. We are not stupid about that. Peter is
very sympathetic to these arguments of Kamal Nath, with whom he
has an excellent relationship, about destabilising the Indian
countryside and in practice, of course, that would mean destabilising
the political stability and democracy in India, so the stakes
are very, very high here. I think we have to recognise that concern.
What is in it for India? I think there are two things in it for
India. First, further liberalisation of industrial tariffs and
services would aid the process of internal reform in India which
has led to the tremendous improvement in Indian economic performance
that we have seen in the last 10 or 15 years which the present
Prime Minister initiated in his earlier days. Secondly, I do think
that in the area of services there is quite a strong Indian commercial
interest and that has been made pretty clear by Kamal Nath to
us in the negotiations. Of course, it is a classic example of
where there is a mutual benefit to trade because of the different
types of services that Europe and India can offer, as it were,
in exchange, and we would be mutually better off as a result of
opening our markets on both sides. In the Indian case on services,
one of the real sensitivities as far as the Council of Ministers
here is concerned is on so-called Mode IV which is basically an
immigration issue, as I am sure you know. If you are an Indian
company doing a contract in Europe, it is about the rights to
bring your workers here. Let us say you are an IT company and
you want to bring your IT workers over for a limited period in
order to fulfil the contract, that seems to me a perfectly reasonable
proposition but it causes all kinds of political sensitivities
in some quarters.
Q144 Mr Singh: Thank you for that.
My intended question is about the Green Box. I would be grateful
for some clarification as to what the Green Box actually is. What
is in the Green Box? What criteria was used to put what is in
the Green Box in the Green Box? Will that criteria be changed,
or certainly reviewed, at Hong Kong and, if there are any changes,
what are they likely to be?
Mr Liddle: It was a hard learning
process when I took on this job working for Peter, I can tell
you. Of all the many public policy issues I have dealt with in
my 25 years of life as an adviser in politics, I have found trade
the most bewildering of all. Let me try and explain this as clearly
as I am able to. A lot of people when they look at the Common
Agricultural Policy, certainly a lot of British people, say, "Gosh,
this is a terrible waste of time, waste of money, what we want
to do is scrap agricultural subsidies". That is the sort
of instinctive reaction a lot of people have. What the EU is committed
to doing is not scrapping agricultural subsidies, it is committed
to scrapping trade distorting agricultural subsides, and that
is a much more qualified concept. What it enables us to do in
Europe is continue to subsidise farmers in order to produce a
sustainable countryside so that they can be stewards of the land,
but not in a way that offers artificial incentives to production
and leads to unfair trading practices, the dumping of subsidised
goods on world markets or very high tariff walls in order to protect
the fact that we have encouraged over-production in Europe. In
the Uruguay commitment, trade distorting subsidies were called
the Amber Box and the Green Box was where you had to make your
reforms in order to remove the trade distorting element in the
subsidies. The 2003 reform did make an awful lot of progress on
that. I remember reading various speeches that Margaret Beckett
made about it and I think that she did a tremendous job as British
DEFRA Secretary of State in the negotiations on that package because
what basically happened was for a very, very high proportion of
the support that was given to EU farmers the link to production
was ended, so farm subsidies are moving over to a system whereby
you get the subsidy for your stewardship of the land, not for
how much you produce. This is a huge change. I do not know much
about farming but I was talking to some people in farming in my
home county in Cumberland, and they were saying the impact of
this change is that as they get the money already, as it were,
they now find that the cost of rearing the animals or growing
the seeds or whatever, the cost of the inputs, exceeds what they
are going to get on the market for this, which is forcing them
to cut back production. The impact of shifting the subsidy regime
from one that is related to production to the Single Farm Payment
system is to cut back production. Obviously it varies: if you
are a very efficient farmer, you have got good land and are very
efficient, you will continue to be able to produce and sell at
a profitable price, but some people will not be. It is that impact
on production which creates the possibility of Europe accepting
more imports from the rest of the world because we will be able
to do that. The non-trade distorting subsidies are what we call
the Green Box. It is absolutely vital for Europe to have this
Green Box accepted. We agree that the disciplines within it have
to be transparent, they have to be clarified, they have to be
tight and it has not got to be a disguised production subsidy,
but this is the trend of policy that Europe is presently engaged
in. If I may say so, I think too often in Britain you hear the
argument calling for scrapping the CAP when, in fact, what we
should be talking about is a sustainable agriculture and making
sure that subsidies go to that purpose and not to distort trade.
Chairman: I will happily echo that given
that 90% of the land in Scotland is Less Favoured, so a total
scrapping would be disastrous. I think it is important to understand
that mix.
Q145 Ann McKechin: I would like to
move on to the NAMA side of negotiations, which I know have stalled
pretty badly coming up to Hong Kong. I think there is some concern
about the EU's suggested formula to deal with this, which is known
as the Swiss Formula, which would appear to insist that developing
countries are going to have to lower their higher bound tariffs
to a greater extent than we are asking them to do for our own.
The ACP countries have come up with a Swiss Formula-plus which
would seem to provide a greater degree of what is known as "policy
space" which the UK Government in turn is saying is something
which developing countries should have. Why is the EU so insistent
on its current formula?
Mr Liddle: I hope you will not
ask me to explain the Swiss Formula because my maths is not good
enough to be able to do so, I have to confess. The argument you
are making is made very forcefully by a lot of NGOs, most forcefully,
I think, by War on Want in the papers of evidence you have had
that I have looked at. We do not agree with it, let us be clear
about that. Let me try and explain why. Let us talk about the
advanced developing countries rather than the least developing
countries. In terms of the advanced developing countries, what
we are seeking is genuine increased market access for our industries.
That means a lower tariff than those countries presently apply.
One of the confusions in all of this is that there is a difference
between the tariffs countries apply and their so-called bound
tariff. I had not any idea about this at all until I came here
a year ago, it was one of the things that one learned, that there
is this difference between bound tariffs and applied tariffs.
In Brazil's case, for example, the average bound tariff for Brazil
is 29.94%—I wrote down these numbers because I think it
is a good way of illustrating the point—their applied tariff,
however, is only 11.63%. That is on average. There are a lot of
variations and some of the tariffs on things like automobiles
are quite a lot higher. What Brazil has proposed is basically
a formula which says, "We will bring down all our tariffs
to the level of our bound tariff, or we will have a formula that
compresses all our tariffs down to the level of our bound tariff,
around that 30% mark". Brazil has something like 9,000 industrial
tariff lines. 2,700 of these are at the bound level over 30%.
What the Brazilians are saying is that they would apply a formula
which would in effect result in real market access of about 800
of these 9,000 tariff lines, in other words less than 10% of their
total industrial goods. That is because all they are doing is
cutting the bound rate, not the applied rate. What we are saying
is we have got to get a cut in the applied rates, however we accept
that the cuts on average the developed world would apply in applied
rates would be higher than the cuts we would ask the developing
world to apply. Peter has talked in general terms of us making
twice as large tariff cuts as developing countries in terms of
our applied rates on average. That is the kind of outcome that
we are working towards where developing countries, even the advanced
ones, in practice are not making as big a tariff cuts as we are
but they are making real tariff cuts. Then there is the Least
Developed Countries and, as I say, for them we have always been
clear that it would be up to them to decide and they can, as it
were, have a round for free. I am sorry if that is not as clear
as it should be perhaps but it is a very complicated subject.
Q146 Ann McKechin: That is very helpful.
Can I ask one supplementary? I understand that the Swiss Formula
is to try to reduce the advanced developing countries' bound tariffs
to a median level, the problem is that China actually has relatively
low tariffs.
Mr Liddle: Yes.
Q147 Ann McKechin: India, which as
we were just discussing has more poor people than the whole of
Africa, has very high tariffs.
Mr Liddle: Correct.
Q148 Ann McKechin: If you try a median
level which includes China, it immediately distorts what the median
would be. With the greatest respect, I think the position of the
Indian economy in terms of manufacturing is much less advanced
than that of China. It seems you are applying an across the board
one-size-fits-all formula for an advanced developing nation but
they are not in the same position in terms of progress in the
industrial formula.
Mr Liddle: They would not be required
to end up in the same position, it is a percentage cut from where
they are now. As I understand it, the main point that the NGOs
make is this point about policy space. In other words, it is not
so much that they are worried about the principle of cutting the
tariff, what they worry about is if you have brought your bound
tariff down you cannot decide at a later stage that you want to
increase your tariffs in order to protect your industries, because
the kind of War on Want people believe in an infant industry view
of industrial development that you have to protect your industry
very heavily in the early stages of development. Of course, this
view of industrial development is highly contested. I do not know
what I think about it, to be quite honest. I think the example
of the Asian tiger economies, who are the most successful of countries
that lifted themselves out of poverty in the post-war period,
probably is that there is some truth in the infant industry argument,
that you need protection at the early stages of development. On
the other hand, some countries that have tried to build successful
industries behind tariff walls have just ended up with very inefficient
industries that are never going to be internationally competitive
and the impact of the tariff is simply to force their domestic
consumers to buy goods at higher prices than they would obtain
on the world market if the world market was opened up. I think
that was the case with quite a lot of India's industrialisation
that was attempted in the Nehru era. As I say, I think it is a
highly contested thing as to what view you take of this.
Q149 Ann McKechin: Would it not be
the case that we should have an independent assessment before
we start making decisions about it?
Mr Liddle: Yes, maybe. That is
worth thinking about.
Chairman: The problem, in passing, is
that we still justify protecting some of our own industries whilst
lecturing developing countries as to the need for them to reduce
theirs. I just pass that as a comment.
Q150 John Barrett: You mentioned
in your opening remarks how vitally important services were. You
will also be aware of the slow pace of progress in the GATS process
of "request and offer". The Commission has been attempting
to speed up these negotiations and could be accused of changing
the rules with its benchmarking suggestion. I wonder if you could
say something about that. Also, could you touch on what you have
heard in your discussions with the NGOs and civil society about
the whole aspect of services?
Mr Liddle: The services negotiations
were going nowhere and, therefore, the Commission felt that it
had to come up with some new ideas. I think there were essentially
three new ideas that the Commission came up with which for us
at a political level, when we saw these papers, we regarded as
perfectly reasonable. One is that you break down services—people
talk very generally about services—into sub-sectors. I think
there are 163 sub-sectors. You set a numeric target. For the rich
developed countries the target we have suggested is you bring
forward proposals for liberalisation in 139 of these 163 sectors.
For developing countries, excluding the poorest, you bring forward
proposals for liberalisation in 93 of the 163 sub-sectors. That
allows quite a lot of policy space for people to say, "Oh,
I do not want my education or my health sector to be involved
in this in any way", or whatever. The second point is the
EU has proposed what it calls "qualitative parameters".
Let us say, on the rights of service investment that means you
should have a measure that says if you are an outside provider
are you able to take a majority stake in a company operating in
a country or not or do the rules force you to a maximum 49% stake,
say. That seems to be pretty important; is an outside service
provider able to have a majority stake or not? The third point
is that we have proposed in services in the jargon what they call
pluralateral negotiations and, as I understand it, that is if
you have a group of countries that want to talk about telecoms
they can opt in to talking about telecoms and having a special
deal on telecoms. It is an opting in proposal, no-one is forced
to join in, but if they do it is a deal that applies to the countries
that have opted in. My own view, and Peter's own view, is that
we are very, very sympathetic to most of the NGO lobby on development,
but I must say we find these arguments that the NGOs put forward
on services very difficult to comprehend and are not very much
in sympathy with them, first of all because we regard services
as crucial to development, secondly because of the point that
I mentioned that it is not one-way traffic, countries like India
are becoming very effective service providers so do not let us
look at it as though we are imposing something on them, which
is just not true, and, thirdly, I do not have this view of the
great majority of European service providers as greedy capitalists
out to take advantage of developing countries, which is the kind
of image that comes across in quite a lot of these papers that
one reads. In fact, rather I think a lot of European companies
that we are aware of have very high standards, including high
standards of probity and anti-corruption, which in the developing
world, in the right circumstances, we think could help the cause
of good governance. I must say, I find a lot of these arguments
quite difficult to engage with because our instincts are just
very different about this, and I have just been honest with you
about that.
Q151 Joan Ruddock: I just want to
make the point, Roger, not to defend the NGOs, but perhaps their
frustration in that respect is because, as you said at some point,
nothing is decided until everything is decided. I think the concern
is that what is perceived as the aggression of the EU on services
is linked to the fact that if we have to hold out to get a lot
on services then we are not going to get to the agricultural needs
of the poorest countries, and it is that perhaps as a package
that gives rise to concern. Not that one could not justify doing
something on services quite separately, but it is the linkage
that is the problem.
Mr Liddle: I understand that.
For instance, if you look at what has happened in sugar you can
understand ACP anger about it.
Joan Ruddock: You can
Mr Liddle: I absolutely understand
that, but I do not believe this argument about services, if you
are just looking at it on its own merits, rings true with me.
Q152 Mr Davies: Roger, as the Chairman
has already mentioned, we had breakfast this morning with several
ACP ambassadors, one from the South Pacific and two from the Caribbean.
Can I put to you first of all two of the things that they said
to us and a third thing which they did not say to us but which
I infer from the position they have taken up. One was that they
saw a considerable lack of coherence within the EU between DG
Development, DG Agriculture and DG Trade, and that made their
lives very difficult and they thought this was bad from the EU's
point of view and contrasted unfavourably with the position in
Washington. I want to put that to you. The second point they made
was they felt pretty badly let down, let down very hard, over
bananas and sugar by an organisation, the EU, with whom they had
had a very close and symbiotic relationship over the last 30 years.
They felt there was no consultation as there should have been
and all the rhetoric in Lomé and in Cotonou about co-operation,
partnership and equality and so forth was for the birds because
they have not been consulted and taken along in this, they have
been the victim of unilateral decisions. They said—I thought
this was a very telling point if it is correct—that although
they had suggested to the Commission that a Joint Impact Assessment
be made so it is possible for the Commission and for them to look
at what the actual impact will be on their producers and their
economies of the measures that you are now imposing on bananas
and sugar particularly, you had turned that down and found various
excuses and said this will not be done on a bilateral basis, which
would be rather a good thing because the whole negotiation has
been based on the assumption that we are talking about a regional
bloc, the EU, with another regional bloc. They felt pretty badly
let down. I would be grateful for your comments on that and what
could be done about it. It is a matter of political concern to
us, going broader than just trade and the Doha Round, that these
countries with whom we have had such a close relationship for
a long time should feel that they have been treated that way.
Of course, in any negotiation there will be a certain amount of
rhetoric about how badly someone has been treated and how the
other side ought to address these grievances, but I thought there
was a kernel of authenticity to their complaints which I must
put to you. The third point is one which I infer, they did not
say this. I inferred from our discussions this morning that the
EU is forcing them to make these sacrifices and change the regime
because the EU needs to make some progress on the Doha Round and
they are just the victims who will have to pay the price for that
but, irrationally, they would now pay the price even if there
is no deal in Hong Kong or later on the Doha Round—they
would still have lost their existing preferential regimes on bananas
and sugar, and in that case for no purpose at all because it will
not be in the interests of the wider trade deal with improvement
in world GDP from which they might gain indirectly and over the
long term plausibly some benefits. They did not put that point
to me but I inferred that from the situation as I understand it.
Mr Liddle: On your first point
about lack of coherence, I think that has certainly been the case
in the past. All I would say is strenuous efforts are being made
to improve performance in the future. The example of where we
are trying very hard is you had your separate inquiry into Economic
Partnership Agreements and there it is absolutely crucial that
the different arms of the Commission work together. This is something
that Peter is very focused on and where he is trying to make an
impact. On your second point about the sense of grievance, I am
very struck by the sense of grievance as well. In our defence,
you have got to remember that in Europe's defence we are facing
WTO action in these areas, that we are multilateralists, we believe
in sticking to the rules, that the banana and sugar regimes have
been subject to challenge through WTO procedures and we have to
reform them as a result. The countries that stand to gain from
these reforms would equally feel aggrieved if we were not acting
to fulfil our legal obligations. That is true. I think the problems
that arise for some of the Caribbean countries, Mauritius and
other places, are awful. As a Brit, these things go back to the
Commonwealth sugar and Commonwealth banana agreements that were
done in the Attlee Government where Arthur Creech Jones was colonial
secretary. There is a hell of a lot of history involved in this.
We are unpicking quite a lot of what were conceived as noble attempts
to help parts of what was then the Empire prosper.
Q153 Mr Davies: Why no joint impact
assessment?
Mr Liddle: I do not know about
that, to be quite honest. You have asked me a question and I just
do not know what the situation is on that. I think the problem
with these countries is that they have not accepted the reality
that because of the WTO these arrangements would some day have
to come to an end. The focus should have been much more on adjustment
assistance and trying to get alternative economic bases for their
economies rather than on trying to hang on to what they already
have. I do not think we have done that perfectly either, there
is a lot of scope for improvement, but, as I said earlier, it
is all bound up in the debate about the EU budget and, if the
EU budget is going to be very constrained, how much the Member
States themselves are prepared to help as well.
Q154 Mr Davies: Can I ask you to
take away the point about the joint impact assessment.
Mr Liddle: I have registered it
very much so.
Q155 Mr Davies: If you could let
us have a note it would be very helpful because I am sure this
will come up and we need to know what the position is.
Mr Liddle: We will do that.[6]
Chairman: That is very fair because they
were quite strong about it.
Mr Liddle: I will straight away
go back.
Q156 Joan Ruddock: Roger is saying
about the obligation that the EU is under in terms of the WTO
and I just wondered about the scope that there is to give a much
longer period of adjustment. Do we really have to make it as brutal
as it seems to be?
Mr Liddle: All I can say is that
this has been going on for a long time. I think the Commission
has tried to do its best within the very, very considerable constraints
that it faces because of the fact that we are dealing with WTO
judgments that we have to meet. I am sorry, but that is the situation.
Chairman: Do you want to pursue your
question about Rules of Origin?
Q157 Joan Ruddock: Yes, if there
is time. One of the things you said in speaking about Aid for
Trade was many countries do not have capacity. I think we would
have liked to talk a bit about how to increase that capacity.
One of the things that are of concern is the EU's Rules of Origin.
I wonder what progress, if any, is being made on that.
Mr Liddle: There are proposals
to simplify our Rules of Origin which are working their way through
the system now. I think that is in hand. That is the responsibility
of Commissioner Kovas, not of Commissioner Mandelson. Progress
on that is being made.
Q158 Chairman: Thank you very much,
colleagues, you have all been extremely disciplined, which I appreciate.
Thank you, Roger. You said at the beginning that the expectations
of Hong Kong are lower to the point of probably not very much
progress but you hope the Doha Round will still come to positive
conclusions. I think you have been very frank in answering our
questions across a range of subjects. Can I ask you a practical
question because three Members of the Committee are going to be
in Hong Kong. I know Peter Mandelson will be there but are you
going to be there?
Mr Liddle: Yes.
Q159 Chairman: I am hoping that we
will have some access to the briefings that the Commission is
providing. Not the closed ones, I know you have open ones as well.
Mr Liddle: Again, Rebecca Collyer
will pursue that as soon as we go back upstairs. Which of you
are going?
Chairman: Myself, John Bercow, who is
not with us, and Ann McKechin. Because clearly Hong Kong is now
a process rather than an end, I think we are tentatively setting
up for Peter to come and give us some evidence in London in the
New Year. This dialogue will continue, I just hope these 25 Member
States can deliver and, indeed, several different DGs because
another part of the problem seems to be fitting all of these pieces
together. Thank you very much.
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