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EU Free Trade Agreements

Volume 561: debated on Tuesday 23 April 2013

The EU has concluded free trade negotiations with Singapore and has launched negotiations with Japan, and EU-Canada negotiations are also in their final stages. An EU-United States free trade agreement would constitute a major contribution to economic growth, and is a top priority for the Government.

Given that the Government were unable to secure significant reform of the common agricultural policy negotiations on the seven-year EU budget deal, what prospect is there is that the Foreign Secretary will be able to make progress on the EU-US free trade agreement?

I think that there is a very real prospect of progress in that regard. There is commitment and real political will on both sides of the Atlantic. The European Commission has published its draft negotiating mandate, and President Obama has spoken about the matter. As an agreement with the United States is potentially worth more than £100 billion a year to European Union economies, we will put an enormous amount of effort into this.

As the Foreign Secretary said, the holy grail of EU free trade agreements is the one with the United States, which would create a world-beating single market and a substantial number of jobs, and would help to increase the EU’s gross domestic product. Does he agree that we would look pretty dumb if we were leaving the EU just as it was signing the free trade agreement with the United States?

My hon. Friend has made his point well, but I do not think that anyone is contemplating leaving the EU before 14 June—if, indeed, ever—when key decisions will be made at the Trade Council in the EU. If that process is successful, it will allow negotiations to be launched during the President’s visit to Europe for the G8 summit a few days later. We are getting on with all these matters now.

I apologise on behalf of the shadow Foreign Secretary, my right hon. Friend the Member for Paisley and Renfrewshire South (Mr Alexander), who regrets that he is unable to be here today. I also thank the Foreign Secretary and you, Mr. Speaker, for acknowledging notification of his absence earlier.

An EU-US free trade agreement will be worth an average of £466 a year to every family in the country. Does the Foreign Secretary agree that if his Back Benchers and some of his ministerial colleagues achieve their dream of leaving the EU, there will be little chance of our securing a similar bilateral UK-US free trade agreement?

I am not going to speculate about that. We are going to make a success of negotiations between all the members of the EU, including the United Kingdom and the United States. That is our objective. As several Members have observed, this would be a transformational trade agreement, and I hope that there is a strong commitment to it in all parts of the House.

I congratulate the Foreign Secretary and, indeed, the Prime Minister on their vision in trying to achieve an EU-US free trade agreement, but does the Foreign Secretary share my concern about the fact that, on occasion, the European Union is very slow to act and to make such agreements? There is still room for bilateral trade agreements through strategic partnerships between countries.

There is no doubt that working with 27 countries on these matters can be ponderous and slow, but when it is successful, it is of enormous importance. Those are the downside and the upside of circumstances in which competence lies with the European Union. When it works, it works well. The free trade agreement with South Korea eliminated nearly 97% of tariffs, and some British businesses are now enjoying a huge increase in exports to South Korea as a result. We want to see the same thing happen on an even greater scale in relation to the United States.

The Foreign Secretary will be aware that the EU has a trade agreement with Israel that allows goods to be imported under preference. He and 16 other EU Foreign Ministers have written to Baroness Ashton asking for guidelines to be drawn up to ensure goods produced in illegal settlements are not imported to the EU labelled “Made in Israel”. What steps are being taken to draw up those guidelines and to bring them into force?

The UK has been advancing the case for such guidelines. That was done under the previous Government, and this Government support it. As the hon. Gentleman says, I have taken this up, along with other Foreign Ministers, with the EU High Representative. We look to the whole of the EU to do this in a co-ordinated and effective way.

I certainly agree with my right hon. Friend that, in view of the fact that we have been members of the Common Market for 40 years, it is certainly true to describe negotiations as “ponderous and slow.” Does he agree that this country might have made more progress towards securing a free trade agreement with the United States if we had not been members of the Common Market, or what is now the European Union?

Like other hon. Members, my hon. Friend is asking me to speculate on areas I do not want to get drawn into speculating about. We make the most of the situation we are dealing with. The fact is that this is a competence of the EU, although our strong political will and support within the EU is required to make the most of such free trade agreements. As I mentioned earlier, working with 26 other countries can mean the process is slow, but it also means that when we succeed, that has an enormous impact. My hon. Friend should bear that trade-off in mind.