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WTO Tariff Rate Quotas

Volume 629: debated on Thursday 12 October 2017

6. What recent discussions he has had with the World Trade Organisation and his US counterpart on the division of WTO tariff rate quotas between the UK and the EU after the UK leaves the EU. (901076)

I discussed the UK’s independent membership of the WTO with the US trade representative Robert Lighthizer when I visited the US in July, and I have had several productive conversations with the WTO director general Roberto Azevêdo, most recently on my visit to Geneva in July.

I understand that Britain and the EU have now formally informed WTO members of how they would like quotas to be split after Brexit, but the Trump Administration and seven WTO members have already rejected the proposals. What will the Secretary of State do to ensure that a deal on quotas is achieved?

I am grateful to the hon. Lady for giving me the chance to explain our methodology. We decided to split the quotas that we have up to now shared with the EU on a market basis. In other words, we would not divide by 28 or by 15, but by the UK’s share of a market. We did that to avoid disadvantaging exporters from other countries, as well as our own producers or consumers. That is the best route to avoid disputes in Switzerland.

As we are talking about the WTO, if this country cannot reach a deal with the EU, what are the Department’s plans if we do not get an agreement on quotas?

As I have said, we first have to get our trading schedules agreed and then we have to agree free trade agreements with third countries, which involves the division of quotas. We are making good progress on that. We want a comprehensive agreement, because that is in the interests of all concerned. However, the Government are preparing contingencies should there be no agreement, which is the only responsible thing for a Government to do.

The Secretary of State knows full well that a technical rectification would disadvantage other members, which is why seven member states of the WTO have written to Azevêdo specifically setting out that that is unacceptable to them. On 6 July, the Secretary of State said that he was confident that a technical rectification of WTO schedules would be

“smooth and fully understood by our trading partners.”—[Official Report, 6 July 2017; Vol. 626, c. 1364.]

Well, it is not. What is he going to do about that? What assessment has he made of the delays and of the impact on our businesses that will result from that?

I do not anticipate that that will happen. The hon. Gentleman clearly does not understand what the process is, or what a negotiation is. It is quite clear that our first offer is not the final thing that we expect to be accepted. For example, we have no agreement yet on what will happen with unused quotas or aggregate measures of support. Those issues will be dealt with during the negotiation—[Interruption.] I know that the hon. Gentleman likes to multitask, but being able to speak and listen simultaneously is not among his abilities.