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Global Free Trade

Volume 300: debated on Wednesday 12 November 1997

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What research her Department has evaluated into the impact of global free trade on third world countries. [14108]

My Department keeps abreast of most research in this sector and is particularly attentive to work by international development organisations including the World bank, the International Monetary Fund and the United Nations Conference on Trade and Development. We also maintain a dialogue with non-governmental organisations and academic institutions which are engaged in the sector.

Would the right hon. Lady confirm her personal commitment and that of her Department to the principle of global free trade? Will she give an undertaking that both she and her Department will work towards the principle of totally free international trade by the year 2020?

Globalisation is a fact of life; it is not a question of whether people are for or against it. It is as big a historical change as the industrial revolution and can bring great benefits to the world, but it can also have damaging consequences. Recent reports say that it will benefit many developing countries, but that there is a danger that some countries could be completely marginalised from the world economy, and that it could also cause increased inequality and marginalisation in the developed world.

Of course we favour globalisation and the benefits that it brings. We believe that we have to intervene to try to ensure that those benefits are distributed fairly. The great challenge for the industrialised world is to believe in free trade in agricultural goods also, which would benefit the developing world but means that we have to put our house in order.

Does my right hon. Friend agree that it is often difficult to reconcile free trade with fair trade, and that we must enhance fair trade? Following the launch of the White Paper last week, will she therefore undertake to let the House know from time to time how Members' efforts in their constituencies to enhance fair trade are getting on, and what expansion there is in that regard?

I agree with my hon. Friend that we must ensure that the growth of world trade does not drive down environmental and labour standards and that it produces an improvement of life for humanity and not competition through reduced standards. I also agree with my hon. Friend about fair trade and the ethical movements that are growing and strengthening in Britain. British consumers want to know that the produce they buy and the places where their pension funds are invested are not exploiting labour or damaging the environment. Such movements have great potential impact to reach out across the world and increasingly encourage business to source ethically and improve standards worldwide.