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Baroness Farrington of Ribbleton: My Lords, I wonder if I might draw two facts to the attention of all noble Lords. First, if all noble Lords overrun their time, Members of your Lordships' House will be here till after midnight, because my noble friend Lady Symons of Vernham Dean has been asked a lot of questions, which noble Lords will expect her to answer. Secondly, I wish to place on record the Companion guidance about noble Lords who speak needing to be in the Chamber for the beginning and end of the debate and, as a minimum, for the speakers before and after them.

The Earl of Sandwich: My Lords, so many wars and emergencies demand our attention that we hear too little of the longer-term daily deprivation in the poorest developing countries. The millennium development goals were certainly one means of highlighting poverty. However, in sub-Saharan Africa, they seem not to be relevant; rather, they are increasingly unobtainable and academic.
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It is difficult to find convincing statistics on world poverty, but I was struck by one provided by the United Nations Development Programme. In the least developed countries, out of an average income of 72 cents a day, 57 cents are spent on daily consumption, leaving only 15 cents for "extras" such as social services or investment in the future. In view of that figure of 15 cents, it is no wonder that the poorest are unable to lift their heads from the necessity of hand-to-mouth survival to those longer-term needs of health, education and employment, which we would like to ensure that survival.

No wonder the poorest, without the help of non-governmental organisations, are unable even to take part in the process of decision-making, which would inform them of their rights and support their chances of a better future. Aid agencies are increasingly turning to rights-based development in their attempt to alleviate poverty. In that context, several of us are encouraged to have the noble Baroness, Lady D'Souza, with us, for that very purpose.

For me, there is the more fundamental question of trade justice, mentioned by the right reverend Prelate. That is a phrase that we shall hear often next year, because of the various summits. Fair trade, in spite of initiatives such as the ethical trading initiative mentioned by the noble Lord, Lord Young, in his maiden speech, is still more a slogan than a reality. On the plate of the new EU trade commissioner, Peter Mandelson, is one very important issue, to which the right reverend Prelate referred: the negotiation of economic partnership agreements within the Cotonou agreement, signed four years ago.

Article 34 of the agreement states that the aim of trade co-operation is to foster,

In other words, in line with the previous Lomé convention, Cotonou was expressly created to help 77 of the world's very poorest countries to escape poverty. But that is not happening. Instead, we are seeing a range of the new bilateral EPAs or free trade agreements, which are forcing those countries to open their markets to European export. Most aid agency observers see an even more sinister motive; they see that the EU is trying—admittedly, against the pressure from our own Government—to reintroduce free trade packages by the back door where it failed during the main WTO negotiations in Cancun.

New issues, such as investment, government contracts, competition and trade facilitation are taking over from the objectives of sustainable development and poverty reduction. As the European Union Select Committee has also identified in its report, which will be discussed next week, that is a real threat to developing countries, which are already suffering from something worse than competition—the dumping of agricultural surpluses from Europe. If you are growing onions in Senegal or tomatoes in Ghana and your market stall is alongside one selling cheap Dutch onions or sun-drenched Italian tomatoes, you may as well go home. That injustice can be removed only through a stricter interpretation of
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Cotonou by member states, and ultimately by the removal of subsidies. African, Caribbean and Pacific states are also supposed to determine their own economic development models, under Article 4 of Cotonou. Why should they welcome neo-colonial partners promising support for their development but seeking free trade for themselves?

According to the World Bank's most recent report, Global Economic Prospects 2005, regional and bilateral free trade agreements have multiplied four times since 1990, burdening poorer developing countries with high costs and complex regulations that do nothing for their economic development. Meanwhile, as the noble Baroness, Lady Whitaker, reminded me, the European Union's farm subsidies reached £140 billion last year, according to the Organisation for Economic Co-operation and Development's annual survey, amounting to 32 per cent of farmers' receipts, still a higher level of support than in the United States. Delays in common agricultural policy reform are inevitably distorting trade, depressing world prices and, while disguising the true crisis in European agriculture, maintaining an unequal international economic system.

Moving from Cotonou to cotton, the welcome ruling in favour of Brazil and others against US cotton producers at the World Trade Organisation in September was a relief to 10 million small farmers in West Africa, who depend on cotton, and millions more in East Africa and Latin America. The same ruling in favour of ACP sugar producers will help countries such as Mozambique, where the sugar industry is the largest employer.

Lack of infrastructure and support is still hampering smaller producers there, but their worst problem is price. With world prices so low, those farmers, men and women, will not be able to afford proper secondary education or even basic healthcare for their children. That is the essential link between trade and poverty that aid alone can never replace. Regional trade agreements, such as that in East Africa, can help a minority, but they work against the smaller cotton and sugar producers.

Increasing aid to the poorest is politically much easier than trade concessions. The international finance facility, for example, is seen as a magic wand, like the Marshall Plan of yesterday. I notice that it is one of the key recommendations of the Prime Minister's Commission for Africa consultation document. Unfortunately, that document majors on good governance, security and human development but says very little about trade, hinting that reciprocity may be better than fair trade.

Yet trade is a means of reaching the poorest communities more efficiently and boosting local economies more effectively than any other form of assistance. If the Government want to achieve the millennium development goals and reinforce Africa's own economic partnership for development, they must put more effort into dismantling trade barriers and sticking to the letter of their agreements. So I hope that
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Mr Mandelson will soon be tabling new proposals that follow the true principles of Cotonou and give new impetus to the forthcoming Doha round.

Trade is not really about capacity-building, which is a favourite response of the Department for International Development and the Department of Trade and Industry. Nor is it about International Monetary Fund conditionality. I acknowledge that poverty reduction strategies, where they genuinely involve civil society and parliaments and if they support agricultural development, as mentioned by the noble Baroness, Lady Whitaker, must play their part. But, as the latest Poverty and Social Impact Analysis shows, they are slow to act and will not be as effective in transferring wealth as a fairer trade mechanism.

Finally, I am also concerned about the shift in European Union aid away from developing countries and towards the Mediterranean and the East. For example, according to Overseas Development Institute figures, the Mediterranean countries received 17.6 per cent of EU aid, compared with 13 per cent previously, and sub-Saharan Africa 39.5 per cent compared with 51 per cent previously. Mauritania, not India, is now in the top 10 recipients of EU aid.

As EU enlargement has progressed, Europe has also naturally committed more aid to its immediate neighbours. Although one can understand that as a legitimate political objective, it runs counter to the broader objective of world poverty eradication. The charge of "Fortress Europe" is therefore reasonable. Despite its industrial and economic problems, Europe is daily becoming a wealthier and more powerful entity, accounting for more than half of all development aid.

As we have heard, next year, Britain holds the presidency of both the EU and the G8 and the Government have a unique opportunity to present the case for poverty reduction. The Chancellor has already led the way with a number of initiatives, and it is just as well for the developing world that he has not been sent elsewhere. Our present Prime Minister has also, to be fair, given time to Africa and the new commission, but I feel that that is a tactical rather than a strategic approach to Africa's problems. Chris Mullin admitted in Nairobi last month that it was quite a short-term initiative to bring Africa higher up the agenda; but it has not so far yielded anything very original or durable.

President Thabo Mbeki's African Renaissance initiative suffered a similar fate. Whether the New Partnership for Africa's Development, a more genuine effort to involve African leaders in good governance, has any more success still remains to be seen. Without real trade concessions from the European Union, it could have very little impact on poverty.

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