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Lord Thomson of Monifieth: My Lords, we share with the noble Lord, Lord Clinton-Davis, the anxieties about the behaviour of the Russians in Chechnya and the worries about the Chernobyl nuclear plant in the Ukraine. I believe that my noble friend Lord Mackie of Benshie will wish to comment on the latter point. There will be a further opportunity tonight to discuss in more detail the Russian behaviour in Chechnya. My noble friend Lord Avebury will speak on that matter and I do not wish to trespass too far on what he may wish to say. However, I repeat that we fully share the anxieties expressed by the noble Lord, Lord Clinton-Davis.

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I do not go so far as the noble Lord in believing that expressing these serious anxieties about serious matters is a justification for delaying the House in dealing with these agreements on partnership and co-operation. They are long-term agreements and considerable potential—I put it no higher than that—exists for dealing with the problems which the noble Lord mentioned. I understood the Minister to say that there will be an interim stage in relation to the agreements and perhaps she will expand on that.

Before dealing with these serious issues in relation to the agreements, I wish to comment on their main thrust; that is, on the economic front. The conclusion of the agreements with the Russian Federation and the Ukraine, and of the later agreements with the independent states which the Minister mentioned, reflect a dramatic and historic change in the pattern of European trade since the dissolution of the Soviet empire. I can remember in my time at Brussels when the Soviet bloc simply refused to recognise even the existence of the European Community. Indeed, until 1989 the USSR traded mainly with its fellow COMECON countries. Only one-quarter of Soviet exports went to the OECD countries.

Today, the European Union is the largest trading partner of all former COMECON countries and half of all the exports of the new independent states of the former Soviet Union go to the European Union. Indeed, the Russian Federation accounts for over 80 per cent. of both exports and imports.

Therefore, the partnership and co-operation agreements are founded on that revolution in trading patterns. The agreements provide a framework which allows the economies to become gradually integrated into a wider European economic area. As I understand it, there will still be tariffs for the time being but there will be a general removal of quotas and quantitative restrictions. There will be new initiatives for direct investment from the member states of the European Union and an ability for companies to set up in the Russian Federation and the Ukraine.

Beyond that lies a free trade area and a good economic climate which will be important for the enlargement of the European Union and for good relations among the countries of eastern and central Europe when they face the possibility of membership of the Community and for good relations between Russia and the Ukraine.

Those are the long-term economic advantages which are inherent in the agreements, and they are important. But the agreements go further than trade and economic matters, as the noble Lord, Lord Clinton-Davis, underlined, and as was described by the noble Baroness in her opening remarks. The agreements offer a regular political dialogue among the new countries of the former Soviet Union and the European Union at ministerial level, at a regular parliamentary level and at a level of officials and civil servants. It is the potentiality of that dialogue which offers some modest cause for hope in facing the problems of the future.

As I understand it, the general principles of both the partnership and co-operation agreements lay down the importance of democratic values and respect for human

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rights as well as the matters relating to the principles of the market economy which I have mentioned. Therefore, in our view, the agreements offer the possibility—and I repeat, it is only the possibility—of exercising a constructive influence, which is so very badly needed for the reasons outlined by the noble Lord, Lord Clinton-Davis. Relations between the Russian Federation and others of the new independent states are not easy, and, of course, relations within the Russian Federation are equally fraught. We recognise that from the horrible events taking place in Chechnya, as described in the press.

The European Union must seek to use both the interim stage and the final stage of the agreements to deal with the problems and to encourage co-operation among the new independent states of the former Soviet Union. I draw your Lordships' attention to the fact that, as I understand it, the agreements contain an opt-out clause under the final provisions which allows appropriate measures to be taken by either party when it considers the other party to have failed to fulfil an obligation under the agreements. The Co-operation Council, which forms part of the agreements, must be informed. That clause protects the fundamental principles of the agreements relating to democratic reforms and respect for human rights. It is an opt-out clause and therefore provides the European Union with an important degree of leverage in dealing with the future relations between ourselves, the Russian Federation and the other new independent states. It is vitally important. In our view, the long-term significance of the agreements is that the European Union should use wisely and well the possibility for influence which lies within the terms of the agreement and that particular opt-out clause.

Lord Monkswell: My Lords, I had not intended to intervene in the debate until I heard the opening remarks of the noble Baroness, Lady Chalker, when she mentioned that the order as it affects the Russian Federation would rectify the mistakes of history.

I wondered about that phrase. I wondered to which mistakes of history she could be referring. Was she referring to the four occasions during this century on which Russia has been under attack by external forces? In the First World War, Russia was attacked by the Germans. After the revolution, there were the wars of intervention by the western powers to which we were a party. In the 1940s, there was Operation Barbarossa and another attack on Russia by Germany. Moreover, for 40 years, virtually until 1989, Russia, the Soviet Union, had been subjected to a cold war and had been under attack again from the west, of which we were a part.

It is interesting to reflect that on two of those occasions we were effectively on the side of Russia and on two of them we were on the side of Russia's opponents. I wonder whether those are the mistakes of history to which the noble Baroness was referring.

Was she referring to the economic situation and the fact that since the end of the cold war we have seen the disintegration of the former Soviet Union? We have seen mass unemployment growing right across the former Soviet Union and also in the eastern European countries which came within the sphere of influence of

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the Soviet Union. There is such devastating unemployment that many women have to sell themselves to eke out a living. That is a reflection of the mass unemployment that has beset the European Union over the past 15 years. Is that the mistake of history about which the noble Baroness spoke—that horrendous rise in unemployment as a result of economic policies adopted by the leaderships of the western world and inflicted on the former Soviet Union, causing such human devastation?

We must ask ourselves whether the partnership agreement goes any way towards rectifying the mistakes of history. I think not. I am willing to be persuaded, but I fear that the noble Baroness would have to talk for a very long time before she could even begin to persuade me that these agreements will rectify any of those mistakes of history. However, I shall be interested to hear what she has to say on that subject.

Lord Belhaven and Stenton: My Lords, before the noble Lord sits down, I wonder whether he has reflected on the number of countries that Russia and the Soviet Union has attacked in the 20th century.

Lord Mackie of Benshie: My Lords, will the Minister be kind enough to comment on the concerns voiced by the noble Lord, Lord Clinton-Davis, and by my noble friend about Chernobyl and extend her reply to cover the question of nuclear weapons? Large numbers of nuclear weapons were stationed in the Ukraine under the control of the Soviet Union's central military authorities. Concern has been expressed for a long time about the competence to deal with those military weapons and, indeed, about any co-operation that there may have been with the central Russian authorities in the Soviet Union—the central staff—who control those weapons. There have been many stories about neglect and competence and, indeed, about the sale of nuclear material. Can the Minister reassure the House that the Ukrainian Government are doing all that they can about such a very dangerous situation?

Baroness Chalker of Wallasey: My Lords, today's short debate has produced many points of interest. Certainly, I would not have put forward the draft orders today had I not been convinced by the very arguments that the noble Lord, Lord Thomson of Monifieth, used; namely, that it is far better to have the contact and to work on such matters with the countries concerned. Therefore, I hope that I can set to rest some of the anxieties expressed by the noble Lord, Lord Clinton-Davis. The noble Lord, Lord Thomson of Monifieth, was absolutely right when he talked about these being long-term agreements with very considerable potential for convincing those in Russia and, indeed, in the Ukraine of the wise way of proceeding.

As we all well know, partnership and co-operation agreements can offer substantial encouragement to the process of reform in those countries. That is what I believe every Member of your Lordships' House would wish. However, I have to say that those reforms will be as much in the interests of our own member states of the European Union as they are in the interests of the Russians and the Ukrainians. In my opening remarks I

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was careful to say that it would be some time before the partnership and co-operation agreements came into force. I spoke of the interim agreements which have been negotiated with each country to bridge the gap before the PCAs enter into force. Perhaps I may repeat what I said; namely, that the interim agreements will bring into early effect the trade provisions of the wider-ranging partnership and co-operation agreements. Therefore, we are starting with the trade elements which obviously assist us in influencing the countries concerned. As the noble Lord, Lord Thomson of Monifieth, said, the very fact that we are working towards agreements which bring members of those countries together with members of the European Union in discussion on a regular basis is another channel for influence in addition to those we have already established.

I turn now to the misapprehension that the noble Lord, Lord Monkswell, appears to be under. When the noble Lord reads the record of my initial remarks, he will note that I said that in the case of the Baltic states, as with the other countries of central Europe before them, we were able to correct the mistakes of history by welcoming those countries back into the European fold with the prospect of eventual membership of the European Union. I went on to talk about the remaining countries—among which I list Russia and the Ukraine—and said,

    "for which European Union membership is not on the agenda for the foreseeable future".

Therefore, I was not in fact referring to Russia. I was referring to the Baltic states and also the countries of central Europe.

In talking about the issues that are before the House today, I should give your Lordships some further information about the main features of the partnership and co-operation agreements. The aim is to intensify the political and economic links between the European Union and the two countries concerned. So there is regular political dialogue at all levels—not simply at head of state level—to effect, impress and, perhaps, change unwise thinking that may, as we know, still exist at some levels in Russia or in the Ukraine.

The second main feature is that of closer trading links, in particular through the abolition of quotas on most goods, by giving most-favoured-nation treatment on tariffs and by abolishing discriminatory internal taxes. The agreements allow for talks in 1998 about eventual free trade areas. The third aspect of the PCAs is that they make it easier to do business in each other's territory. In particular, they set out the terms on which companies can set up, provide a regulatory framework for investment, and aim to bring Russian and Ukrainian practice into line with that of the European Union in areas like competition or the protection of intellectual property.

The fifth main feature is the framework for continued economic co-operation under the TACIS programme—that is, the European Union programme of assistance to the former Soviet countries. Therefore, we have a regulatory framework; we have a framework of political dialogue at all levels; and we have a working

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arrangement which will bring people closer together. Regular dialogue is a feature of the agreements to which the orders refer.

The noble Lord, Lord Clinton-Davis, asked a direct question about how one would sustain a responsive democracy in Russia. I believe that the answer must be the very sort of contact about which I have just been talking in outlining the partnership and co-operation agreements. The noble Lord asked several further questions about doubts among other European nations as regards ratification. Of course, the timing of ratification is, as ever, a matter for each member state. As the noble Lord well knows, ratification by 15 member states may take a very long time. At the end of the process, when all 15 member states have ratified, the Council will decide whether or not to allow the agreement to enter into force.

I made clear in my initial remarks that certain changes had to be undertaken by Russia and, indeed, by the Ukraine, before the agreement would enter into force. Moreover, the matters will also have to be debated by the European Parliament. I believe that we have many opportunities to ensure that the changes take place. That is exactly what we wish to do. I shall deal shortly with some of the opportunities that we have already been using to effect the changes that both the noble Lord, Lord Clinton-Davis, and the noble Lord, Lord Thomson of Monifieth - and, indeed, all of us—wish to see. Certainly, the most effective time to apply the final pressure will be before the agreement enters into force. Most partners agree with that aim. Therefore, I cannot say whether Denmark will delay ratification. That is a matter for Denmark.

The noble Lord, Lord Clinton-Davis, asked about the Conventional Forces in Europe Treaty. Obviously, that is not covered by the orders in any way, but I can tell the noble Lord that while the Russians have argued for some time that the treaty (agreed originally between the Warsaw Pact and NATO) allows Russia insufficient armoured forces in its flank regions, especially along its troubled southern borders, Russia would be in breach of the treaty as of this November if it maintained forces beyond the limits allowed. We were discussing the problem with the Russians well before the Chechnya crisis erupted in December. We believe that the treaty contains sufficient flexibility to address the Russians' concerns. We have made clear to Russia that we will view very seriously any breach of its terms. But as I said, this issue does not affect the particular orders we are debating today.

Let me come to the main parts of our debate, particularly the questions of Chechnya and Chernobyl. I say to the noble Lord, Lord Mackie of Benshie, that obviously the Ukrainian accession to the non-proliferation treaty last December was a most welcome step. We were able to assist by signing a memorandum on security assurances and a statement on European security issues. We have committed ourselves to provide the Ukraine with practical help so that the implementation of the trilateral agreement on nuclear weapons takes place, as, clearly, the noble Lord wishes. We also have some other plans for training and retraining with the Ukrainians which fit in well with the

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needs as we, and now the new Ukrainian Government, see them, for getting rid of the horror of the nuclear threat which certainly existed in the Ukraine but which President Kuchma seems determined to get to grips with, I am glad to say.

Having started on the Ukraine let me continue by answering the questions of the noble Lords, Lord Clinton-Davis and Lord Thomson of Monifieth. We are already working extremely closely with the Ukraine. We have good contacts and we are helping—as I indicated to the noble Lord, Lord Mackie of Benshie—with nuclear safety as regards weapons and also Chernobyl. The PCA for the Ukraine provides for the implementation of separate agreements on nuclear safety. We have given assistance via the TACIS programme. About £215 million has been committed to nuclear safety across the former Soviet Union in the past three years. We and the European Union are also donors to the nuclear safety account administered by the EBRD which gives grant assistance for safety upgrades at the higher risk reactors. That goes to Chernobyl and to other reactors as well. We have made a bilateral contribution of over £13 million to that alone. The PCA also provides for specific co-operation to mitigate the effects of the Chernobyl accident which both the noble Lord and I well remember debating when he was a commissioner and I was the responsible Minister in the European Foreign Affairs Council.

Last July, at the G7 summit in Naples, we agreed an action plan to help the Ukrainians reform their energy sector, including the closure of Chernobyl. There are some 200 million dollars worth of grants from the G7 in support of that plan and there is a European Union offer of some 100 million ecu in technical assistance and 400 million ecu in loans. We are working out the exact ways in which this plan is to be activated with the Ukrainians. I am glad to be able to bring the noble Lord up to date and tell him that only last Thursday President Kuchma gave a commitment to the visiting mission of G7 and EU representatives that Chernobyl would be closed down by the year 2000. That is a welcome commitment and obviously overrides any comments that the plant director may have made in the past. That is now on the books and it will be done. It is a realistic timetable for the closure of Chernobyl whereas dates given before were not realistic. We hope therefore that by targeting our western support the Ukraine will not only stick to the timetable but will do the job thoroughly not just with Chernobyl but with the other nuclear reactors too. I give way to the noble Lord.

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