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Lord Patten: My Lords, I am extremely grateful to the noble Lord for permitting me to interrupt his speech. I have enjoyed it enormously. Anyone who can link Pericles with Secretary Rumsfeld is a remarkable person in making that link. I am sure that Pericles, like Donald Rumsfeld, believed that "stuff" happens. However, I do not know how that is rendered into classical Greek.

In his dissection of neo-conservatism, which as a creed has not yet gained much favour in this country, does the noble Lord believe that the traditional two-way street between the United Kingdom and the United States places this government, whichever party is in control, in if not an absolutely unique, at least an unusual position in attempting to make sure that bilateralism, trilateralism and multilateralism still reign?

Lord Williams of Elvel: My Lords, I am grateful to the noble Lord. I was not going to address that particular problem, but since he has asked to me do so, I shall. I agree that in this country we hold a particular position because of what I would call our Judaeo-Christian culture and constitutional arrangements which, generally speaking, are the property of what the noble Baroness, Lady Thatcher, called the "English-speaking peoples". There is a case for saying that we should be in the middle of all this.

Nevertheless, I somewhat take issue with the noble Lord when he says that we are in a unique position because I do not believe that that is the case. I believe that at the moment we are in a position of fading gentility. I do not say that I am an anti-American. I am an Americophile but I am also a Europhile, so what I say is not anti-American. However, I believe that the current empire of the "neo-cons"—if I can put it like that—will ultimately fall to the financial imperatives of their own country.

Before I close, speaking as an Americophile and a Europhile, I hope that I join the noble Lord, Lord Patten, in saying that I very much regret the pervasive anti-Americanism that is around in this country and in Europe. I hope that we can put our
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squabbles behind us and engage in a sensible discussion with the United States under what I believe to be a slight ideological shift. We must get on with discussing the future of the world which, after all, is a future of great danger.

Baroness Rawlings: My Lords, it is always a pleasure to follow the noble Lord, Lord Williams. I welcome this yearly debate as it was in this debate 10 years ago that I made my maiden speech. It allows the House to express its concerns and, in certain cases, congratulations on the many issues facing the world today.

International development is one area where there is more cross-party consensus than in others. In that light, it is perhaps an opportune moment to congratulate the Department for International Development and the Foreign and Commonwealth Office on what they have achieved in the past year.

I have just attended an extremely interesting conference held by the BBC World Service Trust and DfID on the role played by the media in the fight against global poverty. The three problems I wish briefly to cover today are HIV/AIDS, corruption and illegal drugs. They are intrinsic to this debate. The media, in partnership with politicians, governments and NGOs, both individually and together, have a huge responsibility and the power to change people's lives for the better.

I commend especially the good work of Human Rights Watch in this area. I shall quote an organisation, which states that, "sunlight being the best disinfectant". Transparency is pivotal to developing the democracy so treasured by the brave, struggling people described by the noble Baroness, Lady D'Souza, in her remarkable maiden speech. Transparency is also pivotal to achieving security and alleviating hunger and disease. As Amartya Sen has said:

As we look to the new parliamentary Session, one country in eight is embroiled in civil war. Today almost all wars are civil conflicts in which 90 per cent of the victims are civilians. I shall name but two examples. It was with a heavy heart that I watched the situation in the Ivory Coast unwind again. Meanwhile, despite progress on paper, the situation in Sudan seems to be sliding backwards.

However, there is hope on other fronts. The continual tragedy of the Great Lakes region had unfortunately fallen rather from the press limelight. But on Saturday we saw the heads of state of the 11 countries finally approve and sign a declaration, a document showing that these countries are more than willing to find a common way out of their longstanding conflict. That is a move which I am sure noble Lords will join me in welcoming.

Such a move is but the beginning. A typical civil war leaves a country 15 per cent poorer than it would otherwise have been, with 30 per cent more people living in absolute poverty. It is now believed that while war can and does spread AIDS, it spreads even more virulently once the guns have fallen silent. This crisis
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has occurred in Mozambique and is one which Angola, among others, is now trying to avoid. There is a huge lack of reliable information, which makes it hard to know what steps can be taken to prevent the spread of HIV/AIDS when a country passes from war to peace. Can the Minister inform the House if Her Majesty's Government will be undertaking any research into this particular issue?

So far I have mentioned only African countries. We now have the Commission for Africa set up by the Prime Minister, as mentioned by the noble Lord, Lord Bach, the right reverend Prelate the Bishop of Winchester and the noble Baroness, Lady Greengross. In fact, anyone talking about international development today nearly always refers solely to Africa. There are indeed great problems of governance, poverty and disease on the continent, but I urge the Government and the BBC World Service not to concentrate solely on Africa. Other parts of the world should not be forgotten. I refer to parts of South America, Asia and the former Soviet bloc. Terrible suffering is experienced in those areas as well.

Various forms of corruption often plague countries trying to get back on their feet. I congratulate the president of Nicaragua, Enrique Bolanos, on his moves to lead the way in tackling corruption. But while that may be a popular move abroad, it has rendered him almost powerless at home. We see this through the undermining of his support at all the different levels of society, which shows how deep corruption can run in one country alone. It is essential that Her Majesty's Government remain accountable for the funds they provide in aid to any country in need. However, it is also vital that we hold to account on behalf of their people those responsible for the distribution and use of such funds. We still read stories of how funds have gone astray. Even today, one of the most shocking scandals is the Oil for Food scam in the United Nations, which is still being investigated.

Allied closely to corruption is the evil of the illegal drugs trade and drug abuse. It is estimated that 95 per cent of the world's opium comes from war-torn nations. Last week it was reported by the UN Office on Drugs and Crime that opium cultivation in Afghanistan alone has increased by 64 per cent compared with the figures for last year, making it the highest drug cultivation in the country's history and the largest in the world. Opium cultivation produces the equivalent of over 60 per cent of Afghanistan's GDP for 2003. Sadly this is happening as, paradoxically, the country is progressing towards democracy. Can the Minister expand on the plans in Bill Rammell's statement when he mentioned that:

I am aware that, given the vast number of speakers today, we can but touch on what, in so many cases, are complex issues which deserve much more debate to do them justice. It is vital that we as a nation help and encourage those less fortunate than ourselves, in all
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parts of the world where there is suffering, but in taking on new challenges we must not forget the problems of old.

The Lord Bishop of Oxford: My Lords, the gracious Speech referred to the fact that the Government will assume the presidency of the European Union in July and will also hold the G8 presidency for 2005. These are key roles for international development and will be especially important in 2005, which has been designated as the year to "Make Poverty History".

The heavily indebted poor countries—HIPC— initiative was proposed in 1996 and enhanced in 1999 at Cologne. It is important to note that debt relief makes a real difference. In the 10 countries that had reached decision point before 2000, health spending increased by 70 per cent and school spending across all HIPCs was estimated to have increased by 20 per cent.

However, there is still a long way to go. Money that should be going on development is even now going to service those debts. For example, in Ethiopia, where life expectancy is 42, it has been estimated that debt service payments would continue to be about 74 million dollars a year, even after it received HIPC relief. This is more than its spending on health, which in 1999 was 70 million dollars.

Twenty-seven countries have benefited from the HIPC initiative, 15 having now reached completion point at which debt relief is guaranteed. But, by HIPC's own criteria, only seven of those have debts that are at a sustainable level, which is regarded as 150 per cent of exports. So, even with the maximum debt relief available under the HIPC initiative, many countries will continue to have debts that are not sustainable.

Furthermore, there is a huge amount of debt stock left, estimated at 82 billion dollars in 2003. Africa, which is especially mentioned in the gracious Speech, has a debt stock alone of 196 billion dollars.

As we know, conditionality has been used to force countries to make unwanted changes that are fundamentally unrelated to poverty reduction or to the proper spending of debt relief money. This raises the wider question of the purpose of debt relief, which until now has been to make countries "good creditors". Would it not be far better to tie debt relief and aid to a country's ability to reach its millennium development goals—MDGs? At present, even with maximum debt relief, it will be impossible for the vast majority of countries to reach those goals—the theme of a good number of speeches made by the Chancellor.

There are, however, some encouraging new proposals. The first, proposed by the Chancellor in a speech on 26 September this year, is unilateral debt forgiveness for some World Bank and African Development Bank debts. The UK Government have given a lead on that, looking to others to follow. It is a most welcome initiative, but some questions nevertheless need to be asked about it. Although the money is coming from the existing aid budget, it is widely acknowledged that, in order to fulfil the
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MDGs, debt relief must be in addition to increased aid. Countries need both debt relief and aid to build up the resources to address poverty.

A second proposal is to revalue International Monetary Fund gold in order to write-off debts at the IMF. This proposal by the UK has understandably been widely welcomed. Although there are again questions to be asked about the proposal, there is no time now to go into them.

The third important and interesting initiative is the creation of an international finance facility—an IFF. This proposal could double aid to £100 billion per annum, thus filling the current shortfall of 50 billion dollars. It would leverage the additional money from capital markets by issuing bonds that use donor countries' long-term funding commitments as collateral. Funds would be repaid after 2015. The aid agencies are generally publicly supportive of this. The IMF, having considered the initiative at its spring meeting in 2004, deemed it feasible. However, what will happen after 2015? It is vital that aid flows do not drop off sharply after that point, when overseas development aid budgets begin to be used to repay the bonds. It would be quite wrong to offload present debt onto future generations.

So, while there have been real efforts to tackle the problem of debt—and it is making a significant difference—there is a very long way to go. These and other initiatives must be pursued with a real political will.

Finally, there is the issue of trade justice. The concept of free trade as a good thing has been deeply embedded in our national consciousness ever since the great debates in the early part of the 19th century. I believe in free trade. History shows that any attempt at long-term protectionism is a cul-de-sac. However, genuine free trade depends on buyers and sellers being on an equal footing in the market. That is the only kind of free trade we should be supporting. What we have in the world at present is anything but that.

First, exports from Europe and North America to the developing world are hugely subsidised, with devastating effects on local markets. There was, for example, a time when Ghana had its own flourishing tomato industry. Then it became possible for the population to buy cans of imported Italian tomatoes cheaper than they could purchase local produce, not because Italian tomatoes were cheaper to produce in the first place but because those who produced them were in receipt of a substantial subsidy. There was a time when Ghana had its own local rice crops, but hugely subsidised imported rice from North America soon killed that off. One could go on. Although there are plans, at least in Europe, to phase out those subsidies over a 10-year period, we should not be blind to their effects in the mean time.

We then have to ask whether the most successful industries in the world resulted simply from free trade or whether there have been other factors. There have often been other factors, such as government support and government protection. The Japanese car industry is often looked on as a wonderful success for free trade. The South Korean economy is often looked to as an example
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of how a free market can benefit emerging economies. But both were heavily subsidised and protected by their respective governments—as, indeed, was the successful European Airbus project. There is a case for government support and government protection, not on a long-term basis but certainly in relation to fledgling industries in weak economies in order that they may compete on better terms with a world that has long been developed, and developed very often with the help of governments.

With that in mind, there is particular concern among the aid agencies about the new breed of economic partnership agreements, the so-called EPAs. Until now, the European Union has allowed African, Caribbean and Pacific countries—that is, ACPs—preferential access to the EU market without having to open their economies in return. The EU now wants to get rid of this deal, claiming that it is not compatible with WTO rules. The EU is pushing for faster and deeper liberalisation in a way that could severely limit the ability of poorer countries to support their own small producers or require foreign companies to use local materials or local labour.

At the moment, 46 of the 77 ACP countries that are classified as least developed have duty and quota-free access to the EU market under the "everything but arms" agreement. Now the ACPs are being asked to open their borders to European goods in such a way that they will no longer be able to protect themselves and their producers from cheap, subsidised EU goods flooding their markets and putting local farmers and small-scale manufacturers out of business.

The figures show that the effect of this will be absolutely devastating. The problem is that EU member states, the UK included, have formally delegated responsibility for EPAs to the European Commission but have subsequently taken very little interest in the negotiations, thus allowing the EC to press ahead without being scrutinised. All the aid agencies are united in their concern about this development.

Free trade, in the only meaningful sense of the phrase, means buyers and sellers operating in a market place on an equal footing. That is very far from being the case at present.

2005 is the year of "Make Poverty History". During this year, as the gracious Speech makes clear, the United Kingdom has a very special role and responsibility, as president of the European Union for six months and president of the G8 group of countries for the year. I very much look forward to the Government using their two presidencies to pursue vigorously, with real political will, issues of debt relief, aid and trade justice.

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