Examination of Witnesses (Questions 280-299)
BERR AND UKTI
28 APRIL 2008
Q280 Mr Hoyle: That is what you keep
telling us, but my understanding is there is such frustration
that Diageo may walk away, is that true?
Lord Jones of Birmingham: I guess
we have been listening to the same input, but my understanding
is exactly the same as yours. As always with trade barriers, we
look at it, "Would that be good for Diageo, the people Diageo
employ in Britain, the tax Diageo pays in Britain?", of course
is it good for the Turkish people? The wealth that Diageo creates
in Turkey, the tax Diageo pays in Turkey, it is a two-way street
trade, always. The answer to your question is, no, we have not
seen much progress. Are we trying very hard, yes. As some of you
know, when I got this job I called together representatives of
all government departments and said, "If trade really works
in a nation, it needs engagement across the piece and, secondly,
we have to get brand Britain understood across the piece".
That means if an education minister goes to, for example, Turkey,
I want to know about it. If an environment minister goes to Turkey,
I want to know about it and obviously prime ministers, chancellors
and foreign secretaries also. What we can do is have a concerted
effort in trying to get these barriers knocked down by everybody.
I will not have it that some department says, "Oh well, my
minister does X, that's nothing to do with trade". Everything
that a democratically elected capitalist government does is about
trade and enhancing Britain's brand across the world, trade can
dip into that reservoir of goodwill all the time. We try very
hard to get a bit more of a cohesive approach to visits, to the
intelligence gathering on visits and then using a visit by a minister,
which on the face of it might have nothing to do with trade, to
try and knock down some of these barriers of which you spoke,
to get them to understand why knocking down these barriers helps
on the face of it only trade, but really all parts of our society.
Q281 Mr Hoyle: When we visited India
we found the same problems, and as the TBBC highlighted in respect
of Turkey, banking and finance are heavily regulated and are closed
to trade, yet these are the areas where we have got real expertise
and we ought to be maximising our influence there. Which sectors
will you be promoting during your visit and, more importantly,
which ministers will you be speaking to while you are out in Turkey?
Lord Jones of Birmingham: When
the Prime Minister of Turkey came to Britain back in November
I met with him at the lunch and I did say I was going to come
and if I could meet with him I would be grateful, I am hopeful
I can. Certainly I am going to meet the Trade Minister and the
Defence Minister and I would hope the Education Minister as well
because of the training aspects of what we do. The other thing
I do—and I think you know I have a reputation for this which
I am very pleased about—is I do go to countries and I am
polite but I do not gild the lily. I do tend to say it as it is,
so you will find me doing that again for sure. You are quite right,
if you look at financial services, it is a real jewel in our crown
and it is an area where it is very difficult to break into that
market, so we need to put a bit of effort in there as well.
Q282 Mr Hoyle: I am glad to hear
you are going to rattle the bars. How do you expect the private
sector, the TBBC, CBI et cetera, to be involved in the
visit? Are you going to take a delegation of business people and,
if so, who might attend?
Lord Jones of Birmingham: I will
definitely be taking a delegation of businessmen and women. I
want quite a few of the smaller businesses to come, not just the
big companies that everyone would know. I also have no problem
if the TBBC and the CBI, for instance, wish to come. One thing
I do want is to encourage active chambers of commerce in Britain—Birmingham,
Manchester, Newcastle and Leeds come to mind—to start sending
more trade delegations specifically sector focused to Turkey and
not always Istanbul and Ankara, Izmir and other places as well.
If some of those people want to come and dip their toe in the
water during my delegation in September, they are more than welcome.
Q283 Mr Hoyle: Will the RDAs be involved?
Lord Jones of Birmingham: I hope
so, I really do. The relations between UKTI and the RDAs in Britain
are better than they have been for quite a while, which I am rather
pleased about, and the relationship between RDAs' embedded offices
around the world, and UKTI and overseas markets are better as
well. That might have something to do with the fact that I am
a huge fan of RDAs and everybody knows it, so I am rather pleased
about that. If they would like to engage in my visit, they are
very welcome.
Q284 Mr Hoyle: Finally, can I congratulate
you on you using the Jaguar and getting rid of the foreign car.
I do hope that you can persuade other ministers to start buying
and backing British business like your good self.
Lord Jones of Birmingham: Thank
you very much. On that, I think the word you meant to use between
foreign and car was "built".
Q285 Mr Hoyle: Built in the UK.
Lord Jones of Birmingham: I have
got no problem that it is a Japanese manufacturer that gives me
a car, I have a problem that it is not made in Britain.
Q286 Mr Hoyle: That is right and
you have learned from your mistake!
Lord Jones of Birmingham: I thought
it was made in Britain.
Mr Hoyle: Well, that proves that you
do not know!
Q287 Chairman: Speaking as a great
fan of India, I am glad you have got an Indian car, Minister.
Lord Jones of Birmingham: That
is very good news for the British Midlands.
Q288 Chairman: We will not go there
today, this is Turkey we are dealing with.
Lord Jones of Birmingham: By the
way, do you know, you probably do know because the Chairman of
this Committee knows everything, the only two places on earth
that make a Transit are Southampton and Turkey?
Chairman: We did hear that when we were
in Turkey, but I had forgotten.
Q289 Mr Hoyle: And the British Police
buy Mercedes!
Lord Jones of Birmingham: Do not
wind me up!
Chairman: Do not wind each other up!
Q290 Mr Weir: Obviously energy is
a huge issue politically and industrially at the moment. What
do you feel is the scope and role for Turkey in energy, particularly
in terms of UK involvement in the market and perhaps supply of
energy to the UK?
Lord Jones of Birmingham: Firstly,
in terms of security of supply, that is one of the reasons why
I am very, very keen that Turkey joins the European Union as quickly
as possible and why I am very keen that people who oppose Turkey's
membership understand what they are playing with in terms of both
Turkey being a conduit for other people's fossil fuels that are
coming through the Bosphorus and pipelines and also, of course,
for Turkey herself as a producer in years to come. There is a
wider aspect to this membership issue rather than just the conventional
one from a minister like me about wider markets of getting richer
people. Secondly, in terms of the other side of energy, which
is carbon emissions, as Turkey starts falling foul of the problem
of every single developing economy, which is pollution and carbon
emissions, I think we would have a much better chance of getting
her to walk the path of responsibility if (a) she is inside the
tent and (b) if countries like us work with her and do not preach
to her. I think it is extremely arrogant for us or the Americans
or the Japanese or the French or the Germans to turn around to
your Indias, your Chinas, your Turkeys, it does not matter who,
and say, "We got rich by fouling the planet, you can't".
It is arrogance of the most acute sort. What we should be saying
is, "We have some technological solutions here to enable
you to get rich without causing the mayhem that we did. Let us
share this technology with you, let us partner with you and let's
be a genuine partner in this and not somebody who just wants to
exploit the situation"
Q291 Mr Weir: Is there any evidence
of UK business doing that at the moment?
Lord Jones of Birmingham: Yes,
there is. One of our strengths is environmental engineering in
its widest definition. Again, we were talking earlier on about
small companies, a lot of small businesses do a little bit of
this and the more UKTI have got quite a push. I think somebody
asked me if our sectorial priorities this year are different from
last year. One of them where it is different is we are putting
a lot more energy into supporting smaller companies to get over
to Turkey and sell some of their environmental expertise and some
of their technological solutions to climate change. We must win
the argument that you can pull it off, you can have sustainable
economic growth without burning carbon into the environment in
quite the same way we did years ago.
Q292 Mr Weir: I understand Turkey
has a nuclear programme. Are UK companies involved in that at
the moment? What has your department had to do with involving
UK companies in that?
Lord Jones of Birmingham: I do
not know enough about that and I will not pretend to and say something
of which I am not sure. I promise you, I will get straight back
to you in the next two or three days. I will ask the question,
I will get the answer and let you know. Sorry, Peter has just
handed me this and I will give you this evidence now. "Privately
owned nuclear power plants, corresponding to a total installed
capacity of 5,000 megawatts, will be commissioned by 2020".
That is privately owned in Turkey will be commissioned by 2020
giving about 5,000 megawatts of capacity. "The tender of
the first of these two plants is in process and will be finalised
by September this year. We believe that UK companies will be particularly
well placed to bid for the engineering consultancy side of that
and specialised hi-tech equipment". There is a nuclear research
centre planned in the north of the country and we will be bidding
to help with that. They are going to be building privately owned
ones and some of the consultancy work and some of the hi-tech
equipment will be opportunities for us. I am sorry I did not say
that before.
Q293 Mr Bailey: Earlier you alluded
to education and we have a situation in Turkey where, as you mentioned,
it is a very young population thirsting for education, but ironically
the actual number of Turkish students in FE is declining at the
moment and it would appear that their preference is in the United
States and Germany. When we visited Turkey one of the reasons
that was put to us for that was the extra expense for Turkish
students coming to this country. The figure I was given, it costs
about £3,000 for another EU student to come here to learn
but Turkish students have to pay the full whack, considerably
more. Is there anything we can do to change this?
Lord Jones of Birmingham: Get
them to join the European Union I suppose is the answer.
Q294 Mr Bailey: But before they join.
Lord Jones of Birmingham: I guess
one way of doing it is to try and get them treated differently.
I am a huge believer in the benefit to the United Kingdom of getting
overseas students to come here so that in 20 or 30 years' time
when they are back in their countries and at the top of their
tree, whatever their tree may be, public realm or media or companies
or whatever, we will have a friend to call, will we not, and that
has to be a good thing for our country. We make an investment
if we make it as easy as possible for these people to come in
and get a degree in a British university and that is both facilitation
of entry and also the cost. A lot of people, including a lot in
the media and, indeed, may I say, some of the Members of your
House, will say that they do not understand that aspect, they
do not understand the investment side of it for the good of our
country, they all think of it as all they are doing is going back
to take our education to their country. We have got a bit of a
public opinion battle to win and also then, yes, we have got to
somehow get the fees down for them. How we can get the fees down,
I have not got any bright ideas today.
Q295 Mr Bailey: We have certainly
seen it in the context of India. Would you possibly recommend
extending the EU rate to candidate countries like Turkey, that
would provide one rationale, or a preferential rate for Turkey?
Lord Jones of Birmingham: I certainly
would. I can take that up and I will do so for you. There are
one or two areas where Turkey benefit, for instance in airport
landing fees and flight tax, they benefit from a European rate
and not from an outside EU rate. Could that be extended to this
type of operation, why not.
Q296 Mr Bailey: Could we look at
some sort of mechanism for educational collaboration between the
countries, a working group? One idea that was put to us, and I
believe it has been floated, is a British university in Turkey.
Lord Jones of Birmingham: Yes,
I noticed that and I think to get British universities to think
of opening up in Istanbul or elsewhere in Turkey would be an excellent
idea. When I visit countries, which, as you know, I do nearly
every week, I always try and get to see a British university that
has opened up to give them encouragement and so I can learn about
where it is going well and where it is not. There is not one in
Turkey and I think to get one open would be a fabulous advertisement
for what we do and, at the same time, would reach out to them.
One thing I notice, which concerns me a little bit, is one of
the initiatives from the Turkish Government is a state university.
One of the great, in fact I would probably say "the"
greatest aspect of a British university is its independence and
no matter how much we might not like some of the things they do,
one thing I know for sure is they are free as they do it and free
in their thought and free in their speech and independent of interference.
I would hope we would not see state interference if it was state
funded. We take that for granted in this country. There is an
element of state funding of British universities by the British
Government, of course there is, but somehow they are independent
of it and it is good to see. We take it for granted, our bit in
it, I think in other countries they would do the same.
Q297 Mr Bailey: Could you briefly
comment on the potential collaboration between the UKTI and the
universities and the working group which has been set up?
Lord Jones of Birmingham: Yes.
From the universities in Britain, I am personally very engaged
and very pleased that the working group is up and running. I intend
to meet with them before I go in September and I intend to bang
their drum when I am over there. In fact, I would quite like to
take one or two of them with me, to be honest.
Q298 Mr Bailey: How do you think
specifically this could help in the context of Turkey?
Lord Jones of Birmingham: There
are many ways but two I can highlight. One is it would do enormous
good for the goodwill between the two countries. Do you remember
right at the start of this I talked about how we have got to keep
this subject right at the forefront of people's minds all the
time, that will help. Secondly, as Turkey gets richer she is going
to need to become more productive because she will suffer wage
inflation for sure, look at China now. As that happens she has
got to have access to a better skilled workforce. That comes out
of having totems and emblems of education, skills and training,
no better one than having a university in your neighbourhood.
I think it will develop a more productive Turkey over the next
generation. You would also hope it would mean that one or two
British universities would see the opportunity to succeed and
make money by being in Turkey. To get that moving, you need one
to start with, do you not.
Q299 Chairman: One of the issues
which so often comes up when we go abroad with the business community
in particular is visas. It is always a sensitive issue because
obviously we want to be tight on immigration controls but, equally
well, there is a need for the business world to move fast and
make quick decisions on travel arrangements. Is there anything
to be done on the visa question which is worrying the Turks?
Lord Jones of Birmingham: The
issue rate for the 2007-08 financial year was 93.2%, so we are
talking about problems for 6.8% of everybody who applied for one.
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