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WTO Reform

Volume 666: debated on Thursday 17 October 2019

1. What recent assessment she has made of the extent of the Government’s influence on potential reform of the World Trade Organisation after the UK leaves the EU. (900000)

I am a big supporter of the WTO, but it does need reform. When the UK takes up its independent seat at the WTO for the first time in many years, we will strongly be backing the rules-based multilateral trading system and making the case for reform.

10 December—the date on which the WTO appellate body crisis will come to a head—is looming ever closer. Can the Secretary of State confirm that she will follow the European Union in working to restore an operational appellate body, and will she tell us what conversations she has had with her United States counterpart regarding that urgent need?

When I was at the WTO in Geneva last week, I met David Walker, who is currently leading work to resolve the appellate body crisis. I have given him my full support in that work. It will require movement on behalf of the EU and the US to find a solution to this crisis, but it is vital that we fix this in order to keep the WTO going.

As well as undermining the dispute settlement system, the US is threatening the principles that support developing economies and imposing tariffs for political ends. How does my right hon. Friend propose that the UK stands up for the rules-based order while trying to negotiate a trade deal with the US?

My hon. Friend is right that the rules- based order is very important. Last week we got the support of all the Trade Ministers of the Commonwealth, who represent a third of the world’s population, to make the case for an immediate resolution to the WTO appellate body crisis and for a rules-based order. As she says, it is particularly important for the smaller countries that do not have the muscle to make their way in trade negotiations to be able to rely on the WTO to resolve disputes.

How exactly do the Government intend to reform the WTO? Are they looking at tariffs, for example? What exactly are they trying to achieve?

The WTO needs to reform to reflect trade in the 21st century. It needs to become more transparent. We also need to deal with issues such as state-owned enterprises, forced technology transfer and intellectual property, ensuring that these matters are resolved within the WTO. But we also need an appellate body system that works for all WTO members, which is why I am supporting David Walker from New Zealand, who is conducting the review. I urge the US, the EU and all other parties to work together to resolve this situation.

May I urge the Secretary of State to use our voice at the WTO to champion both free trade and, as she has described them, “orderly” markets? Now is not the time for world trade to revert to old-fashioned protectionism.

My hon. Friend is absolutely right. Since the repeal of the corn laws, the UK has stood up for free trade. We were one of the founding members of the general agreement on tariffs and trade in 1947. There is a huge opportunity for us as we leave the EU to retake our independent seat, to make the case for free trade and to be prepared to stand up for the values that we believe in as a country.

Will the Secretary of State wake up? She sounds almost as if she is in a trance this morning. Instead of talking to significant people in the WTO, will she come to my constituency of Huddersfield to meet exporting companies and top managers there, who believe that she is sticking a dagger into the heart of this country’s exporting companies? We want to know what the future is for exporting businesses in Yorkshire when we leave the EU, if we have to leave the EU.

Well, I can tell the hon. Gentleman that I am going to be in Yorkshire next Friday, visiting and talking to exporting businesses such as Bettys of Harrogate and Burberry in Leeds. If he wants to extend an invitation to me to visit an exporting business in Huddersfield, he should get on with it.

Absolutely. One of the great benefits of trade is the prosperity it can bring to some of the poorest countries in the world. Part of our no-deal tariff schedule is about ensuring that those countries are supported, but we will have a huge opportunity to open up more trade once we leave the EU. At the Commonwealth Trade Ministers meeting, we talked about just that.

We all wish to see reform of the WTO and a functioning dispute resolution system, but given that the UK is responsible for 3.4% of global trade compared with the EU being responsible for 35%—a full third—of global trade, is it not the case that the UK’s influence inside the WTO is now massively diminished?

One of the groups we are working very closely with is our Commonwealth partners. We are developing a Commonwealth caucus at the WTO that represents a third of the world’s population and has a very strong stake in making sure that the WTO works for small states, in particular. Of course we will work with the EU and of course we will work with the US when it is in our mutual interests, but the fact is that the EU has pursued protectionist policies, and that has not necessarily helped some of the least-developed nations. I believe that the UK will have a unique voice, particularly in favour of free trade.

We know that the new Secretary of State can do the impossible, because recently she announced that for the past 45 years the UK had been a member of the WTO—which was only founded in 1995. So will she now inform the House of how she has resolved the challenge that 20 or so members of the WTO have lodged against the UK’s proposed new bound tariff and quota schedules, and of what provisional sum she has agreed with the Chancellor to pay any successful claims?

The UK was a founder member of GATT, which then became the WTO. As the hon. Gentleman knows, by his definition we would only have been in the EU since 1993, because previously we were in the European Community, as I am sure he has said.

Of course we will work through the issues on the goods schedules at the WTO, and we are doing precisely that at Geneva. Those schedules are all ready to go in the event of no deal. Of course, what we want is a deal, and the Prime Minister is currently in Brussels working very hard to get that. If that is what the hon. Gentleman wants, I suggest that he votes for it.