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It is possible to overstate the existing scale of the change. Britain's GDP per capita remains high, our absolute prosperity-rather than our relative prosperity-remains high, and our economic, political and cultural leadership in the world remains very strong. But as a country and even as a continent-not just as a Government or Parliament-we cannot afford to be complacent. The world is changing rapidly. We need to engage constructively and energetically in that process of change so that we can shape it to ensure that Britain benefits as much as the new emerging economies from the opportunities that their rise undoubtedly offers. This task will be central to our future prosperity in the decades to come. We are already embarking on turning that goal into action.
Chris Bryant (Rhondda) (Lab): Thank you, Madam Deputy Speaker. It is a great delight to see you in the Chair. I shall not reveal how I voted, but I did nominate you. This is the dawn of a new parliamentary era. [Hon. Members: "Oh!"] I apologise to the House for the quality of that remark.
I also welcome the Minister to his new responsibilities. He will be backed by a fine team of people, some of whom used to work to me. The quality of the advice provided in the Foreign Office is second to none, not only in relation to other Departments in this country but in relation to other foreign departments in other countries. I hope that the Minister lives up to them.
I have been looking at the Minister's campaign website, which includes an interesting list of endorsements. Indeed, they have something of a theme. There is one from Janet, who lives in Taunton. She says:
"Jeremy is clearly the best candidate. He will be supported by former Conservative voters."
"I'm afraid the idea of Mark Formosa",
"as an MP terrifies me! He is worryingly extreme."
"Why is Mark Formosa so negative and nasty? I'm a natural Tory but I'm not supporting him!"
It is clear that throughout the election campaign the Minister had his eye on a Conservative-Liberal Democrat coalition. It was seated in his mind. It is little wonder that, with him in his new job, the Tory Back Benches have as many noses out of joint as the England rugby team-
The Minister is the first Liberal in the Foreign Office for some 60 years, so I did a little research into previous Liberal Ministers there. Captain Neil Primrose, who was one of the last four, lasted less than five months-
Captain Neil Primrose, who took a strong interest in emerging economies at the time, and particularly Turkey, which we shall come to, unfortunately
lasted only five months in government, because the Government collapsed, and his daughter ended up marrying a Tory. Cecil Harmsworth, who also took a strong interest in emerging economies, is someone whose family gave us the Daily Mail-we often forget that it was the Liberals who did that. The Marquis of Reading had to resign for insider dealing after just three months in the job, while John Simon ended up virtually a Tory, so I look forward to observing the Minister's career.
There can be little doubt that the shape of the world's economy is changing, as the Minister said, and it is changing at a pace that few would have anticipated just a decade ago. Over the past 10 years, the BRIC countries, as they are often referred to-Brazil, Russia, India and China-have alone contributed more than a third of world GDP growth, growing from one sixth of the world economy to almost a quarter. There is also a growing confidence in many of those countries about their economic and cultural future, and they want a far greater impact on the world stage. Indeed, they are often impatient with progress at the United Nations and elsewhere. Thus, in April, Brazil saw its lowest unemployment figures since 2001, and it confidently expects growth to reach 6% this year, and this from a country that in 2002 had to secure an IMF loan-the largest IMF loan ever at the time-of $30.4 billion. India's growth rate is expected to be 8.6%, while China has been averaging at 10% not just for the 10 years to which the Minister referred, but for the past 30 years.
Nothing, however, is certain-we only have to look at a little bit of history to see that. In 1913, Argentina was the 10th largest economy in the world and enjoyed significant advantages over many others: great natural resources, a well educated population and strong international ties to the United States of America, Spain, Italy and the United Kingdom. Today, however, Argentina languishes. Why? In part, I believe, because of the self-inflicted political turbulence that it has experienced; in part, because of- [ Interruption. ] I do not think that it was socialism-if anything, it was national socialism, which was rather closer to Tory philosophy in those days. In part, the reason was that Argentina failed to deal with inequality, but it was also-and primarily-an economic nationalism that created unnecessary barriers to trade. I would say to Argentina today that economic nationalism will do it no favours at all in the years to come either.
Sajid Javid (Bromsgrove) (Con): Does the hon. Gentleman agree that one of the reasons why Argentina had all those problems was that when it defaulted on its debt a few years ago, it had both the largest budget deficit and the largest debt per capita on its continent? Does he see any parallels between that situation and the one that his Government left behind after 13 years of power?
Chris Bryant: Nice try, but we will come a little later to the problems that I see with the Conservative-Lib Dem Government's approach to growth and why I think this debate points to some of the problems that we will see over the coming years. But no, I think that the problems in Argentina stretch back across 100 years. The Argentines failed to take advantage of their many strengths and they played their politics extremely badly. My fear is that they are doing exactly the same thing today.
The task for all those countries is to ensure their growth, while the task for us is to ensure that we match their performance pound for pound, real for real. It is worth bearing in mind how significant those economies are to the UK. To all intents and purposes, we are Russia's banker, while we are Brazil's seventh trading partner in terms of exports and India's fourth. The emerging economies have become increasingly dependent on each other in recent years; thus China has now overtaken the USA as Brazil's major partner. Our position in relation to the emerging economies should be to seek to do three things: first, build UK growth; secondly, fight bilaterally and on an international level for free and fair trade, rather than protectionist measures, which is something to which the Minister referred; and thirdly, constantly underline the importance of the rule of law and human rights.
Let me start with growth. I simply do not believe that it is possible for the UK to achieve a greater share of the markets, or a stronger role in the world, without a strategy for UK economic growth. The Foreign Secretary can huff and puff as much as he wants, but if the Chancellor is focusing only on cutting the deficit-whether through cutting expenditure or increasing taxes-and has no strategy for growth, we will have nothing to sell abroad, we shall lose out economically, and the Foreign Secretary will simply be left to manage the decline of our reputation abroad.
Gordon Birtwistle: Does the hon. Gentleman agree that, over the past 13 years-and probably even over the past 25-the products that we sell abroad have diminished because of Government policy? We now have very little to sell, apart from in the financial markets, because most of our manufacturing has moved to the emerging economies.
Chris Bryant: Strictly speaking, that is not statistically right. Yes, when Burberry tried to close its factory in my constituency, I fought hard to ensure that the business would not be taken to India or China. I do not think that most people would want to buy a high-quality Burberry product that purported to be British if it had not been made in the UK. Unfortunately, we lost that battle. However, we export a lot more than just financial services. For example, a lot of our exports relate to extractive mineral industries, which I shall come to in a moment- [ Interruption. ] I sense that Hartlepool is springing to its feet.
Mr Iain Wright (Hartlepool) (Lab):
I welcome my hon. Friend to the Opposition Benches, and I hope that he will apologise for the appalling nature of the gags. May I first take up the point made by the hon. Member for Burnley (Gordon Birtwistle)? I disagree with him, because the UK is still the sixth largest manufacturing nation on earth. We have moved along the value chain, in that we now provide high value-added manufacturing, such as that produced in Hartlepool by Heerema and by JDR Cable Systems. May I also press my hon. Friend
on a point that he was starting to make? A UK growth strategy is sadly lacking in the new Government. The prospects for growth in relation to supporting and nurturing higher education and to higher value-added manufacturing are lacking. What does he think the Government could do to remedy that?
Chris Bryant: I am a bit distressed that my hon. Friend has just welcomed me to the Opposition Benches, but there it is. We came into the House at roughly the same time, and I will take that matter up with him later. He also made a good point about a growth strategy, which I will come to in a moment. First, I will give way to the slightly older Member.
Malcolm Bruce: Just refer to me as the old lag. On a detailed point, the Crombie overcoat company in my constituency went out of business-or at least contracted its business-because it had a major contract with the KGB, not because it had been successful in the free market. The point that the hon. Gentleman is making about a growth strategy is all very well-yes, we should have one-but can he divorce that from spending even more Government money and getting ourselves further into debt? Can he explain how we can have a growth strategy that does not involve spending more taxpayers' money that we cannot afford?
We need to focus on three elements of a growth strategy in relation to the emerging economies. First, we need active investment in the industries of the future. We have only to take a cursory look at our exports to many of those countries to see that a large part of our engagement relates to old, extremely well established industries, notwithstanding the significant advances that have taken place in some others. For example, it is a simple fact that petrocarbons form the backbone of our world trade with many of the emerging economies. In India, pearls and rough diamonds are key exports, and, in many places, extractive industries dominate our balance of trade. In recent years, we have added telecoms to the list, as well as the pharmaceutical and IT industries, but the UK's future has to spread further, especially into the low-carbon, green industries. I do not believe that that will happen without some degree of Government investment, however, and if we are too slow, others will gain first player advantage.
What support will the Government give to British industry to compete in these green markets? The budget for UK Trade & Investment in 2008-09 was £316 million, with which it assisted 21,800 businesses that recorded an additional £3.6 billion of profit, which is equivalent to a £16 benefit for every £1 spent by UKTI. Will that budget rise or fall next year, and by how much?
The hon. Gentleman talks about the importance of green technology, but I am reminded of a fantastic company on the Isle of Wight-not far from my Bournemouth constituency-that made blades for wind turbines. For some reason, they could not be used in the UK, but they were manufactured to be used in the United States. That company closed down because it did not receive the support it needed from the previous Government. Does he now regret that decision?
Chris Bryant: Yes, of course I do-and I am looking forward to welcoming the hon. Gentleman to the Opposition Benches as well. Whether he will have to transfer his allegiance or we will have to change the Government in order to achieve that is another matter, but he makes a very fair point. I would, however, gently say to him that of course I accept that there will have to be cuts in the coming months and years, but I also believe that we must prioritise those industries where we can make the most dramatic difference and where we can maximise our chances of succeeding in the emerging economies.
The second thing we need to do is to learn some lessons about modern foreign languages. The Minister of State was rather complacent about the facts that India now uses English as its business language and many people in China learn English, rather than French as in the past. Unless we have a cadre of young people, and not only those working in the Foreign Office- [Interruption.] I think "cadre" is now a sufficiently anglicised word to be allowed in a debate and not to be out of order. Unless we have a sufficient number of people who speak modern foreign languages, and not just the useless modern foreign languages such as French, but the- [Interruption.] I have said that to the French; I think they realise there are problems.
Dr Murrison: Is the hon. Gentleman aware that not only has he just insulted the French, but he has also insulted a large swathe of the Maghreb, which has not been mentioned at all in the debate so far? That is a bit of a pity, in particular because one of our major trading partners in north Africa is, of course, Morocco, where the diplomatic language is French.
Yes, but I think that one of the things that has changed over the past 30 or 40 years is that whereas French used to be the most useful language because it was, for the most part, the diplomatic language around the world, that is certainly no longer the case. The most useful languages to speak at present are Mandarin, and Spanish and Portuguese because of Latin America, and we need to focus on Arabic as well.
My biggest concern is that the effortless British superiority with which we stride around the economic world means that all too often we are the only country that presents business people in other countries who do not speak even the rudiments of a foreign language. That is a big problem. [Interruption.] The Minister of State refers to the Deputy Prime Minister, and it is a delight that he speaks so many foreign languages, but I just gently say that it is important that the Government focus on this.
We did not get it right, and ever fewer people in the UK are learning foreign languages. My experience in the Foreign Office was that the number of people who spoke foreign languages has diminished, and the number who can confidently speak them is pretty low.
Mr Jeremy Browne: I am grateful to the hon. Gentleman for giving way as I wish to find a point of consensus with him. It is important not only that the Foreign Office trains to a high standard a sufficient number of diplomats who can engage with the emerging economies in the language spoken in each of those countries, but that we appreciate the wider challenge to our country, which I posed, of the educational curriculum and how well suited we are, not only within the Foreign Office or the Government, but as a nation, to deal with the emerging changes in the world.
The third thing that we need to do to enhance UK growth relates to students from emerging economies. In all, some 48,000 overseas students study in the UK and they are vital to the UK's universities, as they bring in fees, ideas and an international perspective. Ever since Wong Fun graduated as a doctor from Edinburgh in 1855 there has been a large number of Chinese students in the UK. Their number has grown significantly in recent years, with nearly 5,000 starting new courses in 2008, along with 1,581 students from India.
"our student visa system has become the biggest weakness in our border controls."
"insist foreign students...pay a bond in order to study in this country, to be repaid after the student has left the country at the end of their studies"
"ensure foreign students can prove that they have the financial means to support themselves in the UK".
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