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In that context, Beijing was persuaded some years later by John Major in his premiership in 1992 to receive a mission from this Parliament of ours, of which I was the modest leader, to study-this is carefully drafted-

"Matters of common interest, including human rights".

The party included my noble friend Lord Higgins and, more important than that for tonight, the noble Lord, Lord Anderson, who is in the Chamber. We were members of a party of 11 who went together. I remember the way in which we were warmly received by the then General Secretary-later President-Jiang Zemin. He made the point-also made by my noble friend Lord Teverson-that the most important human right for China at that time was the feeding of 1.25 billion people, coupled with the enlargement of social freedom to move, and so on. That was the point that the General Secretary emphasised. However, we made specific recommendations, and we were delighted that four years later, in 1996, the NPC-the Chinese Parliament-enacted legislation providing for a presumption of innocence, a bail system and the existence of defence lawyers. In fact, two out of three of those propositions are now in place. Bail remains a rather shadowy proposition, and it does not surprise one that shortly after the NPC passed the legislation, a Beijing newspaper reported that a retired police superintendent-a member of the NPC-had protested to the meeting that, given all these changes, how could he be confident of capturing criminals? There is that balance of debate in more places than one.

In that context, perhaps I may declare an interest in the Great Britain-China Centre, of which I have been president since 1992. Many colleagues may not have heard a great deal about it, but it has been, and is, a vital vehicle in pressing for the objectives that I have been talking about-the rule of law, human rights and the various missions financed by the European Union and this country that are being undertaken, together with highly technical assistance in sensitive areas of work. The centre helps in the fundamental role of building up trust with key institutions, such as the Supreme People's Court and the Procuratorate. The centre of our current work includes the reduction of the use of torture and firmly addressing the excessive role of death penalties. We are all clear in our memory of that, due to the recent tragic execution of Akmal Shaikh-despite our protests.

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It now gives me pleasure to draw attention to a report in China Daily on 31 May, under the headline:

"New rules on confession to limit death sentences".

I shall quote just two sentences:

"Evidence obtained illegally-such as through torture during interrogation-cannot be used in testimony, particularly in cases involving the death penalty, according to two regulations issued on Sunday ... jointly issued by the top court, the top procuratorate, the ministries of public security, state security and justice".

One has always to hesitate regarding the difference between that which is proclaimed and what happens, but I draw attention to the fact that this is part of steady progress in the direction which we seek to encourage.

My final point concerns the uniquely purposeful quality of the Great Britain-China Centre's achievements. They involve what strikes me, as an ex-Chancellor of the Exchequer, as a very small spend indeed by Her Majesty's Government. The grant-in-aid received by the centre was £300,000 last year. It has been reduced to £270,000 this year, with which we are able to lever other funding institutions, including the European Union, to raise our resources to about £1 million. We are anxious that we should not be further squeezed in the present circumstances.

I dare to say this: in so far as money becomes a problem, given what the Treasury may seek from our overseas budget, I urge the Chancellor to reach out-this may sound very inhuman-towards the huge proportion of that budget exercised by the Department for International Development, so as to allow strong and worthwhile projects, such as those that I have described in the Foreign and Commonwealth Office budget, to continue to prosper in Britain's and Europe's joint interests in the People's Republic of China.

My Lords, I rest my case.

4.55 pm

Lord Anderson of Swansea: My Lords, I congratulate the noble Lord, Lord Teverson, on his opening speech and his very able chairing of our committee. I am truly delighted to follow the noble and learned Lord, Lord Howe, who has a distinguished history with China, not least in respect of the smooth passage of Hong Kong to being a special administrative region of the People's Republic of China.

I was, as the noble and learned Lord said, the statutory Labour member on the human rights mission in 1992, which increased enormously my admiration for the noble and learned Lord as a great leader. Perhaps I may be allowed one short memory of that visit. New passports had been issued in the UK shortly before the visit. The then Prime Minister, with appropriate humility, chose the number 001. The noble and learned Lord, Lord Howe, then Foreign Secretary, could have chosen 002 but, with his usual humour, chose instead 007. When he gave his passport to the officials at Beijing airport, it met with a flurry of excitement. The official in charge called all his colleagues over to see this mild-mannered Welsh gentleman who had a licence to kill. However, he was allowed in and led us extraordinarily well.

The starting point for this debate is, as the noble Lord, Lord Teverson, mentioned, the consensus-across all international and national studies-that China is

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the new colossus. The only difference is over the degree of the Spenglerian relative decline of the West and, perhaps, the pace of the change and whether the US global influence has not declined as rapidly as some claim, as Professor Nye has argued.

There has been an amazing transformation, as the noble Lord has no doubt seen on his regular visits to China. When I went on holiday to Shanghai with my wife, I recall gazing around open-mouthed at the general prosperity. I think at that time almost half the tall cranes in the world were in Shanghai, building those vast edifices. The giddy pace of development is likely to continue, in spite of the downside of increased pollution, which affects Hong Kong, the demographic problems and the problem of uneven development. Shanghai is not the whole of China. As the noble Lord, Lord Teverson, said, we must understand the difference of implementation in the several provinces. I always get this wrong, but it is said, "The mountains are high and the emperor is far away".

How do we in old Europe-since the European Union is China's largest trading partner and overseas market-respond to these changes? I served on the European Union Committee. I confess to being, at first, a little sceptical about the subject that we had chosen. Was it too big? Had there been too many reports from other groups? Where would our value-added be? However, I hail the result, even if it is necessarily broad. I particularly congratulate the noble Lord, Lord Teverson, and Kathryn Colvin, our clerk. We were also well served by Dr David Kerr, our specialist adviser.

When I chaired the Foreign Affairs Committee in the other place, I tried always to ensure that we spoke not only to government and parliamentarians but to a wider audience, including the think-tank world. I believe that this report does just that. I am pleased that we also had our report noted in the European Parliament. I know that the noble Lord, Lord Teverson, has been invited to address the European Parliament's human rights committee on, I think, 15 July, which shows that we are, quite properly, read by our partners in the European Parliament.

Because of the speed of transformation, we need constantly to examine our policies. For example, in the current climate, even when DfID's expenditure is ring-fenced, is DfID doing exactly as it should? Where are the respective responsibilities of national Governments and the European Union? Has China adjusted to its new weight and responsibility? Rather incredibly, China still wishes to be seen as a developing country and, as we saw at the Copenhagen climate change conference, throws its weight along with the other developing countries, even if their interests may somewhat diverge. Is China now more of a status quo power? Is it prepared to play a responsible role in international affairs? The noble Lord, Lord Teverson, mentioned some pointers. I mention Operation Atalanta, in which a Chinese vessel is involved, and, as we see in Appendix VI of the report, the way in which China is playing a significant role in UN peacekeeping operations.

We are on the eve of the UN Security Council decision on new sanctions for Iran. In spite of China's reservations, its declared policy of non-interference in

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the internal affairs of other countries and the significant oil trade between it and Iran, it seems pretty clear that it will vote with the other members of the Security Council on the new sanctions package. However, looking at Chinese history, geography and its interests, we have to accept that those interests will, not infrequently, not coincide with our own, so how does the European Union relate to the new China?

Our report asks how China sees us. Clearly, China has difficulty understanding the complexity and uniqueness of the European Union. At one stage, it hoped that the Union would develop into a united states of Europe, a federation to which it could relate and which would act as a counterweight to the hegemon so often criticised by China-the United States. At others, it has concentrated on individual states, having, as the noble Lord said, had a rude awakening as to the nature of the European Union and our close relationship with the United States in 2003 during the arms embargo saga. On several occasions China has sought to play off one European country against another. It is sad to relate that we have often been prepared to play its game, as was shown in respect of the Dalai Lama.

Much foreign policy comprises international trade policy, which is where the European Union has a key role. I hope that the Government will see clearly that there are areas where we have substantial clout as a member of the European Union that we would not have on our own, particularly as regards specific trade issues, be they counterfeiting or the lack of licensing agreements within China. I hope that the Minister will say how the Government see the European Union's External Action Service working. It is suggested that there is currently a great dispute over the senior appointments, rather like cats in a sack, and that the new action service will not come into operation at least until 1 December. What will be the relationship between the British and EU representatives? I hope that there will be an increased complement of European officials in Beijing. It is absurd that there is now only one full-time EU official there concerned with human rights. We suggested that the European Union should have more widespread coverage within China. I hope that that will not be affected by financial cutbacks. It may well be that, as the Foreign Office looks around for savings in our external representation, we shall find scope for collocation of consular premises in different parts of China with the European Union, for which there should surely be no objection in principle. It would be helpful to know how the Foreign Office and the Government now see the scope for working together with the European Union's External Action Service.

On human rights, much wisdom has already been expressed. We recognise that there is no early prospect of a western-style rule of law. We also recognise that, if we want results, we should not megaphone our Chinese colleagues but instead, as the noble and learned Lord, Lord Howe, said, deal sensitively with them. I believe that we achieved certain results by leaving with our Chinese colleagues lists of sometimes forgotten Catholic priests who were languishing in different parts of China and who, even though nothing happened immediately, we understand were eventually released.

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Although there is some scepticism about the EU/China dialogue on human rights, one has to ask what the alternative is. Indeed, we can concentrate on areas where progress can be made, such as legal reforms, the way in which the prosecution is handled, the rights of defendants and so on. We should press the Chinese to ratify the International Covenant on Civil and Political Rights. We should also note Chinese concern about the western reaction to events in Xinjiang, where, rather insensitively, the western press responded in a one-eyed way, forgetting the atrocities on the Han population in the capital at that time. Over the longer term, we have to work very closely with the Chinese. In terms of student exchange, more than 112,000 Chinese students are in the EU at the moment and, as the noble Lord, Lord Teverson, said, we have to encourage greater EU interests in China.

Much has been said about China in the world. It is gradually adjusting to a global role, as one saw at Copenhagen, and that is now most notably seen in Africa. There are many examples of infrastructure projects for mining rights: platinum in South Africa, iron ore in Sierra Leone, oil in Sudan and so on. There are proper western concerns about transparency, human rights, the increase in debt and training local people, yet the IFC-an arm of the World Bank-has recently, for the first time, financed Chinese investment in Africa and has sought to add human rights and environmental conditions to the offer. One should look for trilateral co-operation between the African Union, the European Union and China. In spite of those concerns, surely Chinese investment is to be welcomed. There is room within Africa for us all. Certainly, African leaders are pleased and there is scope for greater co-operation.

In conclusion, in disputes such as this, there are no partisan differences. I hope that the Foreign Office will respond speedily to the report, as it has promised. Because there are no real differences, I hope that the Government will reply well before we go into recess in July so that we can give the matter consideration. The Government, and certainly the Conservative component, should surely recognise that the European Union is a key instrument in furthering our own national interests and that policy is evolved at all levels-in Brussels and through regular contact between missions en poste. We should seek to understand the problems but also to relate to, channel and co-operate with our Chinese colleagues on a basis of mutual trust. I believe that our report will have made a contribution to that trust and to a greater understanding.

5.10 pm

Lord Hannay of Chiswick: My Lords, the former Prime Minister of China, Zhou Enlai, is recorded as having replied to a question about the consequences of the French revolution with the lapidary statement, "Too soon to say". One could well say the same of the direction and destination of the relationship between the EU and China.

The Chinese have a marked habit of taking the long view of their geopolitical relationships with other parts of the world. We Europeans have a tendency to take an excessively short-term view of such relationships. So it is very desirable, from time to time, to stand back a bit and look at the relationship between the EU and

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China in the round. I therefore congratulate the noble Lord, Lord Teverson, and my former colleagues on Sub-Committee C of the EU Select Committee, on providing us with this timely and thought-provoking report which provides an opportunity to do precisely that.

I shall, if I may, go back to the beginning of the EU-China relationship some 35 years ago last month, not just because I was present at the creation but because it contains some useful lessons for the present day. It also provides me with the opportunity to pay tribute to the former Leader of this House, Lord Soames, for whom I worked at the time in the European Commission and without whose skill and flair the entirely new relationship between the European Community and China that emerged following his visit to Beijing in May 1975 would not have developed so rapidly, so smoothly and so constructively.

The Europe from which we travelled then in 1975 was at that time in some considerable disarray. There was a leadership vacuum following the death of President Pompidou and the departure from office of Messrs Heath and Brandt. Europe's economies were wracked by high inflation and high unemployment following the Yom Kippur war and the quadrupling of the oil price. China, too, was in turmoil with Zhou Enlai and Mao in their final days and the "gang of four" just around the corner. But that did not prevent the establishment of diplomatic relations being agreed and it did not prevent the foundations of the first EU-China trade agreement being made, both of which developments survived all the subsequent upheavals and blossomed into the much more elaborate and multifaceted set of relations described in the report that we are debating.

We should not be overly concerned if the short-term prospects for that relationship are currently not particularly brilliant, nor should we draw too drastic conclusions from Europe's current leadership vacuum and the preoccupation with its internal problems, which is certainly leading to some expressions of frustration on the Chinese side and to a number of derogatory remarks about the waning importance of the relationship.

Why do I take the view that this relationship is so robust and durable, other than the elements of history that I have recounted and which rather demonstrate that? Basically, both sides have substantive and different reasons for ensuring that it remains. There is no parallel here at all for the EU's rather fraught and unsatisfactory relationship with Russia. The Soviet Union, and now Russia, have consistently had as a guiding principle of their relations with the EU and its member states the policy of divide and rule. While the Chinese are not averse from time to time to playing off one member state against the other in an opportunistic way that is not the guiding principle of their attitude. Quite the contrary. From the very outset they have wanted to see a Europe working together and playing a more significant role in the world. They do so not out of any starry-eyed belief in European integration but because they see Europe as one of the constellations in a multipolar world which revolves around the middle kingdom-their picture of a desirable balance of power. They recognise that in the trade policy field, which matters a lot to them, Europe on the whole speaks with a single voice and acts as a single unit.

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From the European perspective, which is a completely different one, effective multinationalism is one of the guiding principles of our common foreign and security policy. That means that we are working for an increasingly rules-based international community because it is in our interest, as well as that of many others, to do so. But we cannot have effective multilateralism without the active co-operation of China, with its veto on the UN Security Council, its membership of the G20, its leadership role among the G77 developing countries.

Getting China to co-operate in achieving effective multilateralism is, of course, no easy matter. There clearly are tensions in Chinese foreign policy between a trend towards nationalism and mercantilism on the one hand, and on the other a trend towards playing a full and responsible role in the search for global solutions to global problems. In joining the World Trade Organisation, and in accepting its fully rules-based approach to trade policy, the second trend has been clearly dominant. In dealings over Burma, Zimbabwe and Darfur, the first trend has so far prevailed. Over North Korea, the Chinese have sat on the fence but they may not be able to do so for much longer. However, one thing is very clear: we shall not achieve our objective from this relationship-the objective of effective multilateralism with the Chinese co-operating fully-if we do not make full use of the toolkit provided by the Lisbon treaty. I was glad to see that point brought out in the report we are debating, and today by the noble Lord, Lord Anderson.

Should we be worried about the possible emergence of a G2, which is a kind of shorthand for a Sino-US directoire ruling the world, to which the noble Lord, Lord Teverson, referred in his opening remarks? I do not myself believe so. For one thing, neither the US nor China seem to me to be prepared for or to want the kind of structured, systematic, all-purpose relationship that a G2 would imply. No doubt, from time to time these two countries will strike deals and that will affect us and many others. But we really should not fret that these two countries bulk so large in each other's foreign policies. They have done so for 40 years now and they are going to continue to do so for the foreseeable future. That has not been, and should not be, seen as an obstacle for a healthy and expanding EU-China relationship.

I believe therefore that we should be relatively optimistic about the prospects for EU-China relations. On my analysis, we are working with the grain of the two parties' fundamental interests. Whether we succeed in building successfully on that foundation depends every bit as much on us as it does on the Chinese. So far, we have not been terribly effective at doing so. But we cannot afford to give up, or to fall back on a network of bilateral links between China and individual member states which will never maximise our influence or successfully further the protection of our interests.

5.17 pm

Lord Inglewood: My Lords, for me, one of the best brief general descriptions of western Europe's relationship with China appears in the opening paragraph of The Chan's Great Continent, written by the great Chinese observer, Jonathan Spence. He writes:

"One aspect of a country's greatness is surely its capacity to attract and retain the attention of others. This capacity has been evident from the very beginnings of the West's encounter with

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China; the passing centuries have never managed to obliterate it altogether, even though vagaries of fashion and shifting political stances have at times dulled the sheen. The sharpness of the feelings aroused by China in the West, the reiterated attempts to describe and analysze the country and its people, the apparently unending receptivity of Westerners to news from China, all testify to the levels of fascination the country has generated".

When I first became involved in China, just over a decade ago, when to my unexpected delight I became vice-president of the European Parliament's China delegation, I was dazzled. At that time, I spoke to an older and wise friend, a considerable China scholar who in a diplomatic capacity-not, I would mention, in a UK diplomatic capacity-spent a number of years in the country during and after the Cultural Revolution. Her reply was, "Don't be distracted by the exoticism: focus on the rational". The problem we face is that we may not fully understand what the Chinese want, since their historic and cultural framework is not the same as ours.

A good example of that has already been alluded to in this debate-the Chinese attitude to human rights. As we all know, in the Chinese hierarchy of values, human rights are different and less important than they are to us. I expect that not only everyone in the Chamber but many Chinese people themselves believe that the Western hierarchy of values is right but, as has already been mentioned, to influence human rights in China, we need to appreciate that our values and theirs may be different. The arguments that we think are self-evident are not necessarily those which will persuade those whom we wish to change. We must deploy the arguments that are potent to others if we wish to bring about change. The report is absolutely right about that.

Equally, the concept of the rule of law is subtly different. It is not law quite as we understand it because ultimately, in China, the law is an expression of policy and the Executive's aspirations-in much the same way as the National People's Congress is not quite the same as Parliament here. In my judgment-I strongly echo the sentiments expressed by my noble and learned friend Lord Howe-we in this country and western Europe have not placed as much emphasis on legal education and the development of legal studies in China as we might have. We have missed a trick in that regard. Had we done as much in respect of legal education as we have in trying to introduce business education to China, we would have achieved more than we have.

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