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International Trade

Volume 670: debated on Thursday 23 January 2020

The Secretary of State was asked—

Global Free Trade

As we leave the European Union, we have a huge opportunity to be a liberalising force for trade in the world. We aim to secure agreements with countries accounting for 80% of UK trade within three years of leaving the EU, and as we take up our independent seat at the World Trade Organisation we will be a champion of global free trade.

The farmers in my constituency of South Cambridgeshire are some of the most productive in the country and they are very keen to increase exports. They also want to make sure that they are not undermined in the marketplace by competing with farmers from countries that follow lower environmental standards or animal welfare standards. As my right hon. Friend starts the negotiations with other countries to increase trade, what is she doing to make sure that farmers from Britain can compete on a level playing field?

We remain absolutely committed to upholding our high environmental, food safety and animal welfare standards post Brexit. As my hon. Friend points out, there are huge opportunities for farmers for trade—for example, getting lamb into the US market. The US is the second biggest importer of lamb by value in the world. Currently, UK lamb cannot get into the US market, and that is a huge opportunity for our farmers.

I thank the Secretary of State for that answer. I am keen to know whether these steps will make a visible difference to the businesses in Wolverhampton that trade globally.

Lowering barriers will mean lower costs for businesses and more choice for consumers. In Wolverhampton and the west midlands overall we send one in five of all exports to the United States. Getting a trade deal with the US would mean a removal of tariffs on products such as cars, textiles and steel, so there are huge opportunities there for those businesses to grow.

I am glad that the Secretary of State expects us to cut lots of free trade deals, but they do not happen by chance; they happen by detailed analysis and tough negotiations. How does she believe we can succeed in those negotiations when the number of expert trade negotiators she has is a fraction of the 600 the EU has? More importantly, is she not setting herself up for a fall by rather foolishly, in my opinion, embarking on parallel trade negotiations with such limited resources with both the European Union and the USA?

I am afraid I am not surprised to hear the SNP talking our country down. The fact is that we have scaled up our trade negotiation expertise. We now have approximately the same number as the US Trade Representative, which is one of the leading trade negotiators in the world. Our trade negotiators have already secured £110 billion of trade continuity deals, even though people such as the hon. Gentleman said it could not be done. Those negotiators have a wide experience in trade law from the private sector, and we have also recruited people from other Commonwealth nations with experience from the WTO. We have an excellent team at the Department for International Trade, and we have the staff in place ready to conduct the negotiations with the US, Australia, New Zealand and Japan.

The statement from the Trump Administration that we will be subject to retaliatory tariffs if we proceed with the digital services tax that is set to come in in April seems an early test of how we will fare in independent trade talks. Could the Secretary of State tell us whether the Government intend to concede to American pressure?

Let me be clear: UK tax policy is a matter for the UK Chancellor—it is not a matter for the US; it is not a matter for the EU; it is not a matter for anybody else—and we will make the decisions that are right for Britain whether they are on our regulatory standards, our tax policy or anything else.

Graham Harvey is a constituent of mine who runs an excellent little composites business on the Isle of Wight. He has just won a big order to sell to Taiwan. That is exactly the sort of business that I know the Secretary of State will want to cheer on, but he is finding it extremely difficult to get export finance and banking finance. I have written to the Secretary of State. Does she share my concern that our small and medium-sized businesses are not being given the support they need to export successfully?

I am very proud of the work that UK Export Finance does. It has just celebrated its 100th birthday of supplying export finance for British business. I am very keen, and I have laid this out to the team, that we do more to support small and medium-sized enterprises. I would be very happy to look at the case for my hon. Friend’s constituent, and make sure that he is getting the support that he needs. We do have additional available finance, and there is also an exporting toolkit for MPs to help them get in touch with export finance.

Industrial Strategy: Steel Industry

2. What discussions she has had with the Secretary of State for Business, Energy and Industrial Strategy on the effectiveness of the Government’s Industrial Strategy in attracting inward investment to the steel industry. (900347)

I thank the hon. Lady for her question and for her continued championing of the UK steel industry. We work closely with colleagues in the Department for Business, Energy and Industrial Strategy to promote steel. Since 2013, the Government have provided more than £600 million of support, including £300 million for energy cost relief, £250 million for innovation and £66 million for new technologies.

The Government claim to be supportive of British steel makers, yet only 50% of steel purchased by the Government comes from Britain. Is it not time that the Government actually backed our steel industry, bought British and introduced a sector deal for steel?

With our colleagues at UK Export Finance, we established a steel export taskforce and we are very keen to promote steel exports. The hon. Lady is right that we should do everything we can to ensure that British steel is used in the UK. I am happy to work, both here and abroad, to make sure we support the steel industry going forward.

Free Ports

3. What recent discussions she has had with Cabinet colleagues on the potential economic merits of free ports. (900348)

My right hon. Friend the Secretary of State is championing the merits of free ports across the Government, in conjunction with Treasury Ministers, including the Exchequer Secretary, who is the constituency neighbour of my right hon. Friend the Member for Scarborough and Whitby (Mr Goodwill).

On 12 December, a blue wave swept up the Yorkshire coast from the mouth of the Humber to the mouth of the Tees as coastal communities, some for the first time, put their trust in the Conservatives to deliver on their priorities. Does the Minister agree that the former SSI British Steel site on the south bank of the Tees would be an ideal site not only as a deep water terminal for the export of polyhalite fertiliser, but as Britain’s first free port?

My right hon. Friend is right. That blue wave was also a cleansing wave that is allowing new thinking. My right hon. Friend the Secretary of State announced our free port policy in Teesport in August. We recognise that more free ports, not least in the Teesport area, can create jobs, rejuvenate communities and boost local economies. We will continue the job creation miracle that has gone on under this Government and, with my right hon. Friend’s help, free ports will be an important part of that.

Could we rise above party politics on this? [Laughter.] Mr Speaker, they don’t blame me, do they? I understand that free ports are fashionable at the moment. If the Minister can persuade me that there will be no disadvantage to businesses in Huddersfield and Yorkshire—I have a long history of co-chairing the Yorkshire group of MPs—we could be persuaded that free ports are a good thing. Will he give us a bit more detail?

A day when the hon. Gentleman rises above party politics is one when we know a significant shift has occurred in the body politic, but I will try to take the question in the spirit in which it was intended. We are consulting and engaging widely, including with devolved areas of the country, to ensure we come up with exactly the right package to be able to assure even the most sceptical, albeit now non-party political people like the hon. Member, that free ports really can galvanise further job development and prosperity.

It is important that this policy does not lead to market distortions and displacement of activity around ports. Does my hon. Friend agree that the key to making this a success is to build on the unique competencies and excellence of individual ports, such as the port of Milford Haven in my constituency, with its unique energy expertise?

My right hon. Friend is absolutely right. It is about tailoring the policy to the particular, ensuring we have something that does not lead to distortion but does lead to additional inward investment. We have gained more foreign direct investment in this country than any other European nation. That is one of the fundamental reasons why we have more people in work as a percentage of the population than the US, Germany or France, and why we have the lowest youth unemployment in our history. I am determined that the free port policy will be well-tailored to the individual circumstances of each area, while ensuring there is no distortion.

As the Minister will know, free ports existed in this country until 2012, when they were abandoned under the coalition Government due to a lack of evidence for their economic benefits. Will the Minister guarantee that if new free ports are introduced, jobs and investment will not simply be displaced from elsewhere in the country, labour rights and standards will not be undermined, and the UK will still be able to meet the level playing field standards that may arise from any future trade deal with the EU?

It may come as news to Labour, or at least its Front Benchers, that we will not be a member of the customs union as we were in 2012. Leaving the EU provides the opportunity to do things differently. We are taking a new cross-Government approach to developing ambitious free ports to ensure that towns and cities across the UK can begin to benefit from the trade opportunities that Brexit brings. It is about time that Labour Front Benchers started to recognise the upside to Brexit instead of always talking this country down.

Most Favoured Nation Tariffs

4. What steps she is taking to ensure that most favoured nation tariffs support UK manufacturing industries after the UK leaves the EU. (900349)

We are developing our own most favoured nation tariff schedule, ensuring that it is right for the UK. We want costs kept low for consumers and to ensure UK manufacturers are not disadvantaged against their competitors.

I thank the Secretary of State for her answer and for visiting me and my colleagues in Stoke-on-Trent last Friday. For industries such as ceramics and businesses such as Ibstock Brick in my constituency, which has two sites—at Chesterton and Parkhouse—does she agree that it is essential that we put in a robust regime of tariffs when countries do not respect the rules-based order and threaten to flood our market with dumped or subsidised products?

One of our aims in a US trade deal will be to bring down the tariffs on ceramics. When I was in Stoke-on-Trent, I heard that those producers face a tariff of 28% on their fantastic crockery. We want to bring that down so that we can have more jobs in Stoke-on-Trent. We will also establish the trade remedies authority, which will take a tough line on dumping from the anti-competitive activities of other nations.

These are changing times for all regions of the United Kingdom of Great Britain and Northern Ireland as we get towards 31 January. Will the Secretary of State further outline what discussions have taken place with the newly restored Northern Ireland Assembly and Executive with regard to trade and tariffs within Northern Ireland, and on its behalf?

I am pleased to tell the hon. Gentleman that there will be a ministerial forum this afternoon to talk about that issue. We will make sure that Northern Ireland is completely involved in our agenda, because we want our independent trade policy, our tariff policy and our trade remedies policy to follow the priorities across the United Kingdom.

I join my hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell) in thanking the Secretary of State for visiting Stoke-on-Trent last week. Does she agree that for industries such as ceramics it is essential that we have a robust regime of tariffs to make sure that we guard against countries who want to undermine the rules-based system?

My hon. Friend is right: we cannot allow dumping practices to go undealt with, and the trade remedies authority will take a tough line in areas such as ceramics. Because we are leaving the European Union, we have the opportunity to have a policy that reflects the needs of the UK and the priorities of UK consumers and UK manufacturers. I am determined to have that, but we must also seek to lower the tariffs on exports for our producers, because we want to see British ceramics, particularly from Stoke-on-Trent, on tables around the world.

EU Bilateral Trade

5. What assessment her Department has made of the effect of the end of freedom of movement in the UK on bilateral trade with the EU in goods and services. (900351)

12. What assessment her Department has made of the effect of the end of freedom of movement in the UK on bilateral trade with the EU in goods and services. (900359)

Leaving the European Union frees the United Kingdom to introduce a fairer immigration system. My right hon. Friend the Prime Minister said at the UK-Africa Investment Summit this week that

“our system is becoming fairer and more equal as between all our global friends and partners. Treating people the same regardless, wherever they come from and by putting people before passports, we will be able to attract the best talent from around the world, wherever they may be.”

We will also be able to reach out and strike new global trade agreements to the benefit of all our constituents and UK consumers.

I thank the Minister for that answer. The President of the EU Commission said:

“Without the free movement of people,”

the UK cannot expect to

“have the free movement of capital, goods and services”.

Is it not true that taking control of our borders comes with not only an unacceptable human cost, but a very serious economic one?

I am sorry, but not surprised, that the SNP cannot see that there is talent beyond the shores of the European Union. Freedom of movement was discussed at length during the referendum. We on the Government Benches believe in respecting the results of referendums, including the one in Scotland.

Scottish Financial Enterprise told the Scottish Affairs Committee that the success of Scotland’s financial industry was based on its ability to access and service all customers in the European Union. Does that not once again highlight the vital importance of freedom of movement to Scotland and show that the UK Government simply do not care about Scotland’s interests or, indeed, Scotland’s votes?

It shows the reverse. As the Government reach out to negotiate new comprehensive free trade agreements around the world, we will negotiate the best deals possible for every nation and every region of the United Kingdom. This Government will always have Scotland’s interests close to their heart.

Is my right hon. Friend as surprised as I am that so many Members of this House do not seem to have read and understood the political declaration on the future relationship? In particular, does he agree that we should expect that the various modes of supply in connection with services will go on around the world and that people will travel to deliver services?

My hon. Friend is right. It is sad that so many in this House, particularly on the Opposition side, including on the SNP Benches, appear stuck in June 2016. We on the Government Benches—[Interruption.] I say to the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) that we are not remotely touchy. While she is stuck in the past, we are focused on the future.

Trading Opportunities: North of England

6. What assessment she has made of the extent of international trading opportunities for counties in the north of England. (900352)

Northern counties exported over £165 billion-worth of goods and services last year, and we want to increase this. New free trade agreements will remove costs for manufacturers and producers and enable those businesses to grow.

I thank the Secretary of State for that answer. As we exit the European Union, it is vital that businesses in Bolsover and elsewhere are encouraged to export to new markets. Does the Department have any plans to strengthen regional teams across the midlands and the north to help businesses take advantage of new trading opportunities?

I am pleased to tell my hon. Friend that we have 130 international trade advisers and 186 export champions—businesses that already export and that encourage their peers to export—across the north of England. We have just sent out an exporting toolkit to MPs on both sides of the House so that they can get in touch with those local trade advisers and help their businesses export. We estimate that there are 600 businesses in every constituency with the potential to export that do not currently do so. MPs have a really important role in helping those businesses to get the information and support they need.

North Africa

North Africa is an important region for the United Kingdom. To advance trade in this area, I have in the last four months alone visited Morocco twice and Algeria once, and led trade discussions at the UK-Tunisia bilateral forum, and the Government have laid transition texts of the Morocco and Tunisian association agreements in Parliament. Taking advantage of the UK-Africa summit this week, I signed a memorandum of understanding to explore opportunities in more detail with Morocco and spoke to the Algeria British Business Council. My hon. Friend is right to see enormous opportunities in north Africa, and we will use the coming months to develop them.

I thank my right hon. Friend for his response. One of the countries he referred to was Tunisia. Will he join me in welcoming the new trade agreement between the United Kingdom and Tunisia, which was signed recently, and which will see 7,723 tonnes of Tunisian olive oil available to the British economy duty-free? Will he meet me and the respective UK and Tunisian ambassadors to explore further trading opportunities?

My hon. Friend is right to see the enormous opportunities. It was my pleasure to lead the trade discussions in the UK-Tunisia bilateral forum last September, and I would be absolutely delighted to meet the ambassadors with my hon. Friends to see what more trade we can do between our two countries.

In its decision issued in March 2019, the High Court of England and Wales confirmed that the territory of Western Sahara is separate from Morocco under international law. It ruled that the UK Government were acting unlawfully by failing to distinguish between the territory of Morocco and the occupied territory of Western Sahara. Yet the trade agreement between the UK and the Kingdom of Morocco purports to apply to the territory of Western Sahara, despite the total lack of consent from the Sahrawi people. Will the Secretary of State explain why that is the case? Given that the Constitutional Reform and Governance Act 2010 process to ratify the agreement is now under way, is it her intention to hold a debate to discuss why the Government are proceeding to ratify a treaty that the High Court has ruled illegal?

We had discussions about this subject with representatives of the Moroccan Government, including the Ministry of Foreign Affairs and International Cooperation, when I visited Morocco two weeks ago, and indeed it was raised by my hon. Friend the Minister for Africa when he was there with me last October. The United Kingdom has taken the consistent position that the matter needs to be resolved diplomatically and sensitively with ongoing discussions.

Topical Questions

We are a few days away from leaving the European Union, and, for the first time in 46 years, establishing the UK’s independent trade policy. That gives us the opportunity to take up our independent seat at the World Trade Organisation, to champion free trade, and to secure free trade deals with partners around the world. There is a huge opportunity for the UK, and we want to make the 2020s the decade of trade.

There are many great British manufacturers, including Croft Architectural Hardware in my constituency. As well as making products for the Palace of Westminster, it exports them to the United States and China. What more can we do to support fine British manufacturing talent like that?

I congratulate Croft Architectural Hardware on its brilliant work. I understand that we have helped it to attend two trade fairs in the US through our trade show access programme. I also note that there is currently a 4% tariff on door knockers; I hope that in future trade agreements we shall be able to get that removed.

Can the Secretary of State point to any examples of intersecting customs unions anywhere else in the world? Will she confirm that under the EU customs code to be implemented in Northern Ireland, goods will have to be declared and products of animal origin will have to pass through a border inspection involving both documentary and physical checks, and does she accept that those will subsist completely irrespective of the tariff regime in any future free trade agreement with the EU?

As we have made very clear, we want to ensure that there is no hard border in Northern Ireland. That is a priority for the Government, and we have reached a new agreement with the EU that delivers on it. Of course, we need to work through the details of precisely how that arrangement will work.

The hon. Gentleman needs to recognise that the world is moving on: we are moving into an area in which trade is being digitised, and we are finding new ways of facilitating customs. Rather than being negative and a naysayer, why does he not contribute to the solution?

T3. Guildford is home to a growing computer gaming industry. What steps is my hon. Friend taking to encourage inward investment in that sector? (900363)

The Department’s high potential opportunities programme, which aims to identify and promote a range of foreign direct investment opportunities throughout the UK, is currently working with the Enterprise M3 local enterprise partnership and others in Guildford to highlight the commercial opportunities offered by the video game and 5G clusters in that region, which are world leading.

T2. Given President Trump’s description of climate campaigners as prophets of doom, and given the revelations that he has banned all reference to a climate crisis in any US trade deal, what assurances can the Secretary of State give the House that any UK-US trade deal will support the UK’s own climate objectives, and, indeed, persuade the US to recommit itself to the Paris agreement? (900362)

I believe that the UK has a huge opportunity to promote clean energy and our climate change agenda—our carbon reduction agenda—across the world. Yesterday I met the New Zealand Trade Minister to discuss how we can work together in the future to incorporate those into forward-leaning trade agreements. We will seek to do that with the US, the EU, and all the other partners with which we work.

T5. In the light of the very welcome UK-Africa Investment Summit, what assessment has the Minister made of the commercial opportunities for British firms across the whole of that great continent? (900365)

I spent months working with colleagues across Government to deliver the UK-Africa Investment Summit, which took place on Monday. I am delighted with the result and proud of the work of so many officials in making it happen. We have announced 27 commercial deals worth more than £6.5 billion from across African markets, but, as my hon. Friend has pointed out, there is enormous potential for more.

T4. Glenkinchie distillery in my constituency is threatened by the tariffs imposed on Scotch whisky by President Trump. Given the decision to leave the EU and seek a trade deal with the USA, and given threats about changes to the definition of Scotch whisky, what assurances can the Minister give that we will not be washing down chlorinated chicken with a glass of American rye? (900364)

I would gently say to the hon. Gentleman that if we are to de-escalate these tariff disputes, attacks on the US Administration and the President are unwise and unwelcome. We are working across Government to persuade the United States that these tariffs are damaging to the Scots whisky sector—[Interruption.] If Scottish National party Members would stop chuntering and get behind us, we might have more chance of removing these tariffs. We will seek to stand up for the Scots whisky sector and persuade the United States to remove these tariffs. My right hon. Friend the Secretary of State has been in touch with trade representative Lighthizer, and we will work for the Scots whisky industry. Get behind the Government!