Quadripartite Select Committee Minutes of Evidence


Examination of Witnesses (Questions 320-338)

DR KIM HOWELLS MP, MR TREVOR MOORE AND MR GRAHAM GLOVER

25 APRIL 2006

  Q320  Chairman: Quentin, let the Minister reply.

  Mr Moore: Can I at least tell you the systems we have in place to look at export licences. I can say that I chaired a meeting three or four weeks ago where we were checking our systems with regard to China, and we had input from the Ministry of Defence, from the Department of Trade and Industry and from the Foreign Office. We look at each of these applications with great care, taking the criteria into account. We look at human rights, we look at creating stability and we look at potential aggression, so the systems we have in place are quite substantial and very careful.

  Mr Davies: It is not an embargo.

  Robert Key: It looks like pilots for fridges.

  Q321  Linda Gilroy: Just to set that in the wider context, are you saying that the Government has carried out thorough systematic analysis of China's behaviour in importing and exporting military equipment of strategic items?

  Dr Howells: Yes, we look very carefully at that.

  Q322  Linda Gilroy: What are your conclusions about where they may be straying away from where you would prefer to see them not going?

  Dr Howells: We have had a great many worries about that over the past 30 years, there is no question about it, and we are looking at the moment at trying to persuade China that, for example, its activities to skewer resources in Africa should not be motivated by narrow, short-term economic interests. That is something one would have thought we ought to have a dialogue with China about.

  Q323  Linda Gilroy: Are you having that dialogue?

  Dr Howells: Absolutely, yes, we do.

  Q324  Linda Gilroy: Do you agree with the recent article in the Financial Times that China is pursuing in Africa a "hard-nosed and value-free" policy to acquire oil, resources and markets in countries such as Zimbabwe, and that it will undermine hard choices of political and economic reform?

  Dr Howells: Yes, we are worried about that, and we have tried to persuade them otherwise.

  Q325  Linda Gilroy: What do you think the consequences are for arms control if China steps up arms sales to countries such as Zimbabwe?

  Dr Howells: Very serious, which is why we seek to maintain our influence on decision-making in China.

  Q326  Linda Gilroy: So is there a justification for lifting the embargo while China is prepared to increase arms sales that fuel conflicts in Africa?

  Dr Howells: Mrs Gilroy, it is a subject of very serious debate within the EU at the moment. We are taking part in that debate and we watch the situation in China very carefully and we judge each application for an export to China on a case-by-case basis and on the basis of the criteria that I have already mentioned.

  Q327  Mike Gapes: Can I take you back to your answer earlier to Quentin Davies? The Foreign Secretary came before our committee on 12 January 2005, and in an answer to a question there he said, "If you go back to the China arms embargo there is quite a lot of room for interpretation about the scope. As it happens, the UK interpreted the China arms embargo in a narrower way than some other Member States." Can I put it to you that your answer just now would imply that in fact we are no longer interpreting it in a narrower way but are in effect taking a looser interpretation as a precursor to the fact, as we were told during the evidence when we produced this report, that in practice the arms embargo on China and the EU code of conduct will in practice be no change, that in fact you are already loosening up the interpretation from a narrow definition as of 2005 to a wider definition now, and that is what we are seeing? Can I bluntly put that to you?

  Dr Howells: And I will answer you very bluntly: absolutely not.

  Linda Gilroy: Do you mean broader rather than loosening?

  Mike Gapes: I am saying that—

  Chairman: The questions go to the Minister.

  Q328  Mike Gapes: What I want to be clear on is, would you have been exporting engines for fighter aircraft in 2004 to China, whereas now we are doing so?

  Dr Howells: Yes, we have exported spare engines in the past.

  Q329  Mike Gapes: There is no change, no loosening up of the interpretation?

  Dr Howells: No: no change, no loosening up, no subterfuge or hidden agenda.

  Q330  Malcolm Bruce: In the context of Darfur, as I understand it, it is China that has been blocking the attempts to get embargoes and has actually put pressure on the Sudanese Government. Would it not be an effective counter to the Chinese pressure to stop selling engines unless they were prepared to work with the international community to apply those sanctions?

  Dr Howells: Mr Bruce, that is certainly a proposition that is worth looking at and it is the kind of proposition that is considered. We have to make those decisions and they are not very easy decisions to make. We are certainly very worried, as I said in answer to Mrs Gilroy's question, about the way in which China is looking, for example, at obtaining its raw materials from Africa as they are becoming more and more difficult to get at prices that a country like China can afford. It is a serious matter and we certainly look on a case-by-case basis at each of these applications.

  Q331  Mike Gapes: Is there not another problem with the way that China is behaving in Africa, and I quote the specific example of Angola to you? I visited Angola in 2004 and at that time the Angolan Government was not under any kind of constraint in terms of its attitude to its revenue from oil sales. It had not signed up to the transparency initiatives to do with anti-corruption.

  Dr Howells: When was this?

  Q332  Mike Gapes: In 2004, and it was clearly, because of its debts, facing some serious problems. The Chinese came in and a deal for a former Shell area for exploration off the coast was up for sale. It was going to be bought by an Indian company but at the last minute a Chinese company came in and got it. As a result of that, as I understand it, the Angolan Government was given some financial help by the Chinese and therefore was not signing up to the criteria which the International Monetary Fund and the other international institutions wanted. Can I put it to you that there is a real danger that China's approach in Africa is undermining moves towards good governance and transparency and the kinds of things that we in our general policy wish to encourage, and it is linked into this question of arms sales as well, which was touched on earlier?

  Dr Howells: Certainly, Mr Gapes, I did not know about that example of that oil exploration block and the various shenanigans that went on to enable the Chinese to obtain the right to explore for that oil and presumably to tap it. There is no doubt, and I want to make it clear to this committee, that we want to see China's engagement in Africa support democratic and accountable governance and we work very closely with China to achieve that end. It is no good us backing off and trying to say that, well, they are going to do it anyway. If that is the case there is no point in trying to maintain these diplomatic links with China. We do not believe that it is a hopeless case. We think that China can be persuaded to adopt a different attitude.

  Q333  Mike Gapes: I am not arguing against diplomatic links. There is an issue here that international standards are being undermined by the way in which the Chinese are operating whereby they make no demands on governments about whether they are corrupt or despotic or whether they carry out genocide against some of their own people. As long as they can get the resources, that is what they are interested in getting.

  Dr Howells: Mr Gapes, we have to try, hard as it is, to persuade them otherwise and we have to try to maintain what links we have, good links, with the Chinese, whether it is politicians or companies, and we have to try to persuade them that if we are to have a sustainable future for all of us then China has got to play its part in trying to improve governance and not undermine it, whether it is in Africa or anywhere else.

  Q334  Peter Luff: At least there are prospects for success in engagement with China and for world resources, and there are some grounds sometimes for hope and optimism in the world. There is evil in the world but sometimes good things happen and countries come out of arms embargoes because there is an improvement in those countries. Obviously, it is important that the EU takes a consistent approach. The approach I understand is characterised as the toolbox, for what reasons I do not quite know. How is the toolbox coming along? How many tools has it got in it?

  Dr Howells: I have to tell you, Mr Luff, that I hate that expression as much as you clearly do. Nevertheless, it is the kind of garbage language that we use these days. The toolbox will be a set of measures that the Member States will use with post-embargo destinations. Crucially, it will oblige Member States to share information in detail and on a frequent basis about the licences that they have recently granted for any country emerging from an EU arms embargo, and this document is not yet agreed. We hope it will be soon, and certainly before any question of that embargo against China is lifted.

  Q335  Peter Luff: It is more than a year since the committee was first told about the progress of the toolbox. In your memorandum in December you talked about final details still emerging. It is dragging on a bit, is it not?

  Dr Howells: It is dragging on a bit, yes, not for want of effort from us though, I may add.

  Q336  Peter Luff: Thank you for that. How did we, for example, when Libya came out of its own embargo, ensure a consistent approach applied there?

  Mr Glover: It is fair to say that the toolbox is an extra element in the debate that other members of the committee have already raised, so the two things have got caught up in the same nexus. For Libya the toolbox obviously does not apply because it is not agreed, but there has been discussion of Libya within COARM which Trevor chaired during our Presidency and which I attend now we have not got the Presidency. We share information about the kinds of licence applications we are getting for a country like Libya, and there is a tour de table when Member States say what they have received, what they have approved and what they have not, so we have internal transparency on that basis but it is not as systematic as is nailed down in the toolbox because it is not agreed yet.

  Q337  Peter Luff: It has got the odd screwdriver or two but not yet a full set?

  Mr Glover: We have got the tools we had at the start but we have not got the new tools yet.

  Q338  Malcolm Bruce: Some of us are somewhat alarmed to see what a clever and purposeful group of scientists can do to transfer the technologies that we do not want to get into the wrong hands, and Abdul Qadeer Khan appears to have done it comprehensively over a period of 30 years, possibly being the prime source for Iran, Libya and North Korea. I want to ask you what lessons we can learn, and in particular the extent to which they are able to use front organisations so that over a period of 30 years we did not know it was going on. We did not have any intelligence. What have we learned from that and how can we be sure that it is not going on and will not go on again?

  Dr Howells: I am sure, Mr Bruce, that it still is going on and it worries me enormously. I heard, for example, when I was in Islamabad recently that A Q Khan is perhaps under some kind of house arrest or detention but there are reports that he is seen at some receptions in some parts of the city and so on, but the guy is a sort of national hero, the father of the Pakistan bomb. Certainly the damage that he perpetrated for a whole range of reasons we are still discovering the extent of, and the connections with Iran, for example, are almost certainly very strong and very serious ones. What do we do about it? I mentioned a little earlier the two-year pilot project that is trying to promote export control co-operation. We are trying through that pilot project to work out how it might be possible to exert much greater influence and control on the way in which these scientific secrets, if you like, are disseminated and passed around. I think we can make progress on that. I think we have learned a lot from the A Q Khan affair about the way in which these things happen, and hopefully we can make the defences against that kind of leakage much stronger in the future.

  Chairman: Minister, there were two or three other questions that we wanted to pursue, but I am mindful of the fact that, with a division and coming back, what the pressures on your time are, so if you are agreeable perhaps we could write to you on the remaining three questions rather than reconvene the whole meeting. Colleagues are agreeable, so, Minister, can I say formally thank you very much indeed to yourself and your two colleagues for coming this afternoon. It has been very helpful indeed and we really appreciate it.





 
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