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Doha Trade Round

Volume 462: debated on Wednesday 11 July 2007

The breakdown in the G4 talks in June was disappointing, but does not mean the end of the Doha round. Negotiators from all countries are working hard in Geneva now and we expect new proposals soon. We are working with EU member states and other World Trade Organisation members to help to break the deadlock.

I thank the Under-Secretary for that frank answer. Does he agree that the best method of relieving poverty in developing countries is by developing trade with industrial countries? Has not appalling EU protectionism in the current round of discussions let developing countries down?

I agree with the hon. Gentleman’s first point that increasing trade as a vehicle to drive economic growth in poor countries is absolutely fundamental if we are to see progress made towards the millennium development goals, which both sides of the House hope to see. We are now witnessing significant reform of the common agricultural policy, which has given Peter Mandelson, the Trade Commissioner, the flexibility to offer progress in the negotiations on the EU side. We need further concessions from our American allies, as well as from our Indian and Brazilian colleagues in the areas where they are able to offer them.

Given the current stalemate in the World Trade Organisation talks, will my hon. Friend consider extending the EU “Everything But Arms” scheme, which would effectively provide more jobs in the developing world and reach out to countries such as Kenya?

I should say to my hon. Friend, whose interest in this issue over a number of years I acknowledge, that the gaps between the key G4 countries did narrow at Potsdam, so we believe that there is continuing hope for progress in the round. My right hon. Friend the Prime Minister has made very clear his determination that we should do all we can to maintain momentum in this round. That is why he has made a series of calls, not least to the Prime Minister of India and the President of Brazil, and also why progress has been made in talks with key interlocutors such as the director-general of the World Trade Organisation. It is also why there will be a Cabinet Committee to take forward co-ordination across the Government in this area.

We welcome the Secretary of State to his new responsibilities and the Minister to his expanded responsibilities on trade. Further to the Minister’s remarks about the need for the Americans to move in these negotiations, is he aware that while exports of clothes and garments from African countries to America have increased sevenfold over the last five years, the same exports to Europe have actually declined? What plans does he have to increase the ability of African countries to sell into Europe, and is he seeking to change the rules of origin requirements, which are at least partly to blame for the problem?

The hon. Gentleman is right to highlight the importance of these trade negotiations in the effort to reverse the decline in the share of trade to Africa, particularly in respect of agricultural products. He is right to say that we need radical reform of the rules of origin requirements and we continue to press the EU to offer a more generous system for those rules. That is why my right hon. Friend the former Secretary of State for Trade and Industry and current Chancellor of the Exchequer, in partnership with colleagues in other European countries, wrote to a number of Commissioners to press for progress on those rules of origin. We do need greater progress from our American allies, particularly in respect of allowing Africa to increase its trade of cotton into American and EU markets.

On the issue of the EU, the Minister will be closely following the discussions between the European Commission and developing countries about economic partnership agreements. If EPAs cannot be negotiated and agreed by December, will the British Government accept the Commission’s imposing the generalised system of preferences, or will the Minister press for an extension of the WTO waiver?

The hon. Gentleman is also right to highlight the importance of the economic partnership agreement discussions that are currently under way. They have the potential to deliver considerable economic benefits and contribute to poverty reduction across Africa, the Caribbean and indeed the Pacific. We are pleased with recent progress made in the negotiations, particularly regarding flexibility and the generous market access offer that the Commission has put forward. We are also pleased with the renewed enthusiasm across all six negotiating groups in the ACP to conclude negotiations by the end of December.

Many who follow these discussions understand fully the need for the American Administration to respond to its somewhat vocal farm lobby. Nevertheless, does my hon. Friend agree that if there is to be further penetration of the depleted markets in developing countries, where farmers in many cases are still earning less than $1 a day, that would not only be unfair, but we simply would not achieve the millennium development goals?

My right hon. Friend makes a particularly important point on the United States. The World Bank has estimated that farmers in Africa lose out on between $75 million and $100 million per year as a result of cotton subsidies, particularly in the United States. We need some additional flexibility from our American allies, as well as from the EU, India and Brazil.