The Secretary of State was asked—
Steel Imports: Removal of Tariffs
The Trade Remedies Authority assesses the UK’s trade remedies and makes recommendations to the Secretary of State. This includes the recent review of the UK steel safeguards. The Government accepted the recommendation of the TRA to extend 10 of 19 steel safeguards. The Government also introduced legislation to allow us to extend the current steel safeguards measure for an initial period of 12 months to a further five categories.
The Trade Remedies Authority recommended revoking nine of 19 steel safeguards despite calls from the sector and the all-party parliamentary group on steel, which wanted all tariffs extended, but the UK Government will keep only about 15 of them. The UK steel sector is not on a level playing field with competitors because of higher energy costs and the lack of a corporate industrial strategy from this and successive Tory Governments. Is this not another broken Brexit promise to a domestic industry and its workers?
I remind the hon. Lady that we have invested £500 million in recent years to help with the cost of energy. I also remind her of the welcome from the sector for the Secretary of State’s decision on 30 June, when Gareth Stace, director general of UK Steel, said:
“Today the UK steel sector applauds the Prime Minister…and Trade Secretary…for standing up for steel”
“taking back control”.
Opportunities for UK exporters are significant. We are seeing exports rebounding this year and they are expected to grow by a further 8% next year, and further opportunities are being created all around the world as we have rolled over the existing EU deals, plus the EU itself, and started to negotiate other agreements. Of course, the first from-scratch agreement in principle was with Australia. I hope the hon. Gentleman would applaud and support this direction of travel.
That is all very well, but food production businesses in my constituency face a loss of trade, challenges with customs, and damage to their supply chains. They require to operate in today’s land, not some promised land that their business might never survive to be able to see. What is the Minister going to do to ensure that their difficulties are minimised and that support for them is maximised? They need butter today, not a promise of jam tomorrow.
It would very much help if the Scottish Government and the Scottish National party, of which the hon. Gentleman used to be a member, were to support the trade deals that we do to open markets around the world. He ought to know, as should his former colleagues, although I know they are pretty split even among themselves, that actually Scotland trades more with the rest of the world than it does with the EU. He will also note that EU volumes in May were back to the highest level since October 2019, so we are back to pre-pandemic levels with the EU. The teething problems are being dealt with, other problems are being minimised, and Government support is there. [Interruption.] It is about time that Scottish National party Members, who like to chunter from a sedentary position, got behind our exporters and stopped talking them down.
UK Exports to the EU
Latest monthly figures for UK goods exports to the EU show that in May 2021 exports were £14 billion, up by 8% on the previous month. This is the highest monthly figure, as mentioned by the Under-Secretary, my hon. Friend the Member for Beverley and Holderness (Graham Stuart), since October 2019, and it is £2 billion higher than the monthly average for 2020 and just £0.2 billion lower than the monthly average for 2019. Latest quarterly figures for UK services exports to the EU show exports for the first quarter up by 2% on the previous quarter of last year, but still 2% below the 2020 quarterly average and still some 20% below the 2019 quarterly average.
Well, there are lies, damned lies and statistics, and I do hesitate to criticise and rain on the Jackanory story we are hearing from those on the Government Benches, but let us look at some facts from the Office for National Statistics. Comparing quarter 1 of this year with 2019, UK-EU trade is down by 27%. Some of that is accounted for by covid; much of it is accounted for by Brexit. Make UK reports that 96% of its members are having problems with the new trading regime. These are facts. What is the Minister’s secret? How does he maintain his Panglossian optimism for the future while ignoring such pain and hurt in the here and now?
I was quite deliberate in the use of those statistics. We do need to take care with monthly statistics. None the less, the first quarter data is already two months out of date. The hon. Gentleman is right that there was a dip in January, but that was due to the closure of the border at that time due to the prevalence of the alpha variant in this country. Since then, there has been a very significant recovery. The latest data from May shows £14 billion of exports, up by 8% on the previous month, and only just lower than the monthly average from before the pandemic. He can quote the ONS, but perhaps he might want to look at the latest data, refresh his briefing, and ask his questions according to the latest available data.
Three weeks ago, Lord Frost rejected the EU’s offer of a veterinary agreement, saying:
“We are very ambitious about CPTPP membership… That is the problem.”
Since we cannot ask Lord Frost himself, can the Minister perhaps tell us why the UK’s accession to the comprehensive and progressive agreement for trans-Pacific partnership is incompatible with reaching an agreement with Europe on food standards? From which of our current food standards do the Government wish to diverge?
I think the hon. Gentleman is confusing a number of different things, but let me start by saying that the UK proposed an equivalence agreement on sanitary and phytosanitary rules in negotiations—that was proposed by Lord Frost—but the EU refused. The EU does have agreements with, for example, New Zealand and others that still respect regulatory autonomy. We are very happy to discuss with Brussels an agreement on SPS rules so long as it respects UK regulatory autonomy and we do not sign up to dynamic regulatory autonomy. That is the read-across to other trade agreements; it allows us to have an independent trade policy while maintaining the high-quality trade deal that we have with the European Union.
The Minister can defend his Government’s Brexit bourach all he likes, but EU-UK trade fell by 27% in quarter 1, with Scotland punished even further. He cannot blame covid, as the fall was over three times worse than the global comparison. Official statistics show that for every £245 that Brexit cost in lost trade, even if the Government were to agree multiple free trade agreements, it will bring in only around £18 in return. The UK is virtually alone in facing this kamikaze blow to its exports. Scotland voted against this trade catastrophe. When will the UK Government renegotiate this disaster—or do they intend to continue to be anti-trade?
I take that with a bucket of salt from the SNP about being anti-trade. As we have heard so often in this House, the SNP has failed to support any trade agreement negotiated either by Brussels or by us in Westminster. I do not think there is a single party in this House that is more anti-trade than the Scottish National party. I urge the hon. Gentleman to have a look at the latest data. Trade with the EU is recovering—it may not yet be fully recovered, but it is recovering—and the latest data, in May, shows a very significant 8% improvement on the previous quarter. I refer him to last Friday’s data.
Mr Speaker, you can see why we do not support any trade deals from this Government—because they always sell Scotland out. Let us hear what industry is saying. Fishing representative bodies continue to say that the Prime Minister has betrayed them and that they have been sold out. Individual losses of tens of thousands of pounds are commonplace due to export delays. A perfect storm of red tape, driver shortages and other Brexit issues are destroying businesses across the board, but especially in food and drink. According to the Road Haulage Association, almost a third of UK hauliers say they are having to avoid working with the food and drink industry due to increased checks and admin. Costs are up everywhere on materials, admin and transport—20% in distilleries. What compensation is planned for those affected—or, when the Prime Minister said “eff business”, was that an instruction?
There was a lot in that further supplementary. May I just remind the hon. Gentleman that most of the trade deals that he and his party have not supported are actually the EU’s trade deals? His party’s policy is to re-join the EU. The SNP was against the EU-Japan deal in the European Parliament and abstained here; it was against the Canada deal; it was against the Singapore deal; it abstained on South Africa, and it abstained on Korea.
When it comes to fisheries, I refer the hon. Gentleman back to what the ONS said, not this past Friday but in relation to February’s data—he is so out of date. This is what the ONS said in April:
“The disruptions to food exports in January 2021 appear to have largely been overcome and may have only had short-term impacts on trade.”
That is what it said in April, yet he is still not up to date. On hauliers, we are discussing all the time with the Department for Transport what extra action needs to be taken.
Finally, the hon. Gentleman asks for compensation. Perhaps he can come to this House and account for the £180 million given by this Government to the Scottish Government for dealing with the consequences and the impact of Brexit at the end of the transition period, because we are not at all sure where that money has gone.
The reality on the ground is quite different from what the Minister may be claiming. I recently met many manufacturers and businesses in Warwick and Leamington, such as Bravissimo, Vitsoe and young British designers, and they are desperate. Their concerns are underlined by surveys by the Federation of Small Businesses, the Institute of Directors and Make UK showing the serious and lasting damage being done to UK firms trying to maintain their trade with Europe in the face of the inadequacies of the Government’s Brexit deal. Can I ask the Minister of State whether he thinks Lord Frost has the bandwidth to fix those problems, on top of the Northern Ireland protocol, or do we need someone else in Government to get a grip?
The Government have full bandwidth on all these aspects. We are satisfied with the trade and co-operation agreement. It is an agreement that is working well. In terms of adding support to exporters, that is the role of this Department and other Departments. We have helplines in place. We have the Brexit business taskforce. We have the DIT internationalisation fund. The Department for Environment, Food and Rural Affairs has a £23 million seafood disruption fund. We have recently opened trade hubs in Edinburgh and Darlington, and we will open hubs soon in Cardiff and Belfast. We have a refreshed export strategy coming later this year. The Government are fully engaged on assisting exporters to get their goods and services into the European Union.
New Free Trade Agreements
I wish the hon. Member for Harrow West (Gareth Thomas) a happy birthday. I hope he has had all the answers he was looking for today.
We now have trade deals with 68 countries around the world, plus the EU, covering trade worth £744 billion last year. Last week, I signed a trade deal with the European Economic Area-European Free Trade Association countries Norway, Iceland and Lichtenstein. It is one of the new generation of trade deals we are signing, which Britain has struck as an independent trading nation. It shows that Britain is a pioneering partner of choice when it comes to trade. They have gone further with us than with any other FTA partner, benefiting every corner of our country. From fish feed to cheese, sausages to strawberries, tariffs have been cut, backing jobs across Britain.
While I wholeheartedly congratulate the Government on the agreements negotiated so far, as the chairman of the all-party parliamentary group for the Maldives, I urge my hon. Friend, following our meeting, to negotiate something that is slightly different, an economic partnership agreement, with the Maldives Government, which would benefit not only our country but the core industry of sustainable tuna fishing in the Maldives in the light of COP26.
It was a pleasure to meet my hon. Friend recently to discuss trade policy regarding the Maldives. He will know that we have agreed trade deals covering 31 African, Caribbean and Pacific countries already, showing our belief in trade for development. I can confirm to him that I am keen to find a route to short circuit the process of agreeing more trade deals like these with Commonwealth friends around the world.
I concur with the previous speaker on the Maldives.
Some seafood companies in Scotland have seen their costs of selling to the continent treble from 32p a kilo to about £1 a kilo. Also, UK exports to Ireland have fallen by 47.6%. All that illustrates the current damage Brexit is doing. We know from Government figures that, for every £490 lost to GDP, trade deals are not bringing in very much, unfortunately: an Australian trade deal makes up only £2 of that; a New Zealand trade deal £1; an America deal, if it happens, £20; and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership will bring in £3 to £8, depending on the way the cards fall. Has the DIT identified any other trade deal that might make up merely 0.1% of GDP, the odd £10 for every £490 of Brexit loss? Is there a figure for India yet? It has been a number of weeks since I asked the Minister this, but is there a GDP figure for a trade deal with India, if it happens?
The question has been asked and it has already been answered. I would have thought that the hon. Gentleman would welcome that, in the EEA-EFTA trade deal, we have secured great benefits for Scottish businesses exporting to Norway. According to the figures I have seen, Orkney Scottish Island cheddar could see its duty reduced by two thirds. There will also be an important new opportunity for fish feed exporters to export tariff-free to Norway—it will see previously high tariffs on fish feed slashed to nought—providing a potential boost to the aquaculture industry in Scotland.
Negotiations to Join the CPTPP
Her Majesty’s Government formally began negotiations on the UK’s accession to CPTPP on 22 June. Negotiating teams will be working hard over the coming months to ensure a good deal for businesses, producers and consumers across the UK. The UK’s accession would make CPTPP a truly global free trading area and strengthen the UK’s relationship with 11 dynamic economies across four continents.
Taiwan is one of the top 20 trading nations in the world, a vibrant democracy, a member of the WTO and an Asia-Pacific Economic Co-operation member economy. Could the Minister confirm that the UK welcomes Taiwan’s intention to join CPTPP alongside our own application and update the House on efforts to deepen our bilateral trade ties with Taiwan?
Taiwan is a subject close to my heart, and we know that it is an important and growing trading partner for the UK. It is a highly valued member of the WTO as well. Future membership of CPTPP is a matter for the members at that time, but I note that Taiwan is looking to align itself to CPTPP’s high standards and is continuing its long-standing commitment to rules-based trade and the global trading system. We expect CPTPP to grow in size, and future members will be a matter for future consideration. I am looking forward to our next round of Joint Economic and Trade Committee talks with Taiwan, hopefully as soon as travel becomes possible again.
I very much support the Government’s efforts to become a member of CPTPP, which, as the Minister mentioned, offers great prospects. Indeed, my constituency is a major centre for renewable energy and has links with, for example, Taiwan. Does he anticipate that the renewable energy sector will gain great advantage from CPTPP membership and boost those industries in my constituency?
Yes. CPTPP will of course liberalise trade in goods and services in the fast-growing markets in the Pacific, and fast-growing markets have fast-growing needs for clean energy. In recent times, I have been in Vietnam, Korea and Taiwan, pushing UK expertise and exports, for example, in the offshore wind sector. I remind the House that the UK has the world’s largest offshore wind capacity. I am sure there will be opportunities for that and other renewable sectors in Yorkshire and the Humber, including in Cleethorpes.
The Government are relying on increased trade with Malaysia for three quarters of the forecast benefits from joining the CPTPP. That may explain why Ministers have turned a blind eye to the growing use of slave labour in Malaysian factories. If the Minister disputes what I have just said, perhaps he can tell us what proportion of the 760 million medical gloves bought by the Government from Malaysia during the pandemic were manufactured using slave labour?
We take our obligations and any allegations of the use of slave labour extremely seriously. I am happy to look into it if the hon. Member has specific allegations in relation to Malaysia. I might add that the Malaysian supply of latex gloves last year was extremely important for this country, but I am happy to look into it if he has specific evidence of the use of slave labour. Of course, Malaysia has not yet ratified CPTPP. We hope that it will and I remind him that CPTPP has a comprehensive chapter on labour and workers’ rights.
The Minister really was not in a position to answer that question because his Department failed to act on warnings last year from the high commissioner in Kuala Lumpur telling them that their slavery audit function for glove manufacturing was not up to the task. It simply cannot be allowed to continue, so if I write to the Minister with the Government’s current list of glove suppliers—I have a list of 19 companies so far—will he agree to conduct a proper audit of their factories? Bearing in mind what he just said about accession to CPTPP and Malaysia having yet to ratify it, will he also reconsider signing any trade agreement with Malaysia as long as its reliance on slave labour persists?
I repeat my offer to have a look at the specifics, of course. The UK Government take all such accusations, allegations or reports extremely seriously. When it comes to Malaysia joining CPTPP, they have signed and it is up to them to ratify. The UK is not currently a member of CPTPP so it is not up to us who joins it at the moment, but I remind the hon. Gentleman that CPTPP does include a comprehensive labour chapter that ensures that the parties protect and enforce labour rights, improve working conditions and strengthen co-operation on labour issues, all of which would be very helpful in the sort of cases that he is talking about.
G7 Advocacy for Free and Fair Trade
At the May Trade Ministers’ meeting, we committed to a global trading system with open markets that are not undermined by unfair trade. We agreed to work together to reform the global trading system to be free and fair for all.
My hon. Friend is right that we need to tackle unfair market practices, such as subsidies by state-owned enterprises in industries such as steel and aerospace. On Tuesday, I met my US counterpart, Katherine Tai, and we agreed to work together on this issue.
In the G7 Trade Ministers communiqué, issues around free and fair trade were balanced on transparency and supply chains being free of slave labour. Can the Secretary of State provide us with an update on the conversations that she has had with G7 leaders and, in particular, can she possibly let me know whether she will be congratulating the US Senate on passing a law last night that will ban all imports from Xinjiang because, of course, they are full of Uyghur slave labour?
I agree with my hon. Friend that forced labour is an abhorrent practice. We have already taken action in the UK to ensure that there is no forced labour in our supply chains and G7 Trade Ministers are committed to tackling this issue. We are working on best practice to prevent, identify and eliminate forced labour in global supply chains ahead of the G7 October trade ministerial.
I welcome the work that my right hon. Friend is doing with her G7 counterparts to reform global trading and encourage a rules-based multilateral trading system. Does she agree that a free and fair trading system will help countries, including the UK, to build back better from the covid-19 pandemic as part of a strong economic recovery?
My hon. Friend is absolutely right. There has been a worrying rise in protectionism in recent years and I am proud that the UK is leading the way in liberalising trade, striking new free trade deals to bring more jobs and growth as we seek to build back better after covid. At the same time, we are defending UK industry against unfair practices.
I hope that the Secretary of State has had a productive visit to the United States. She will have seen the example set by the Biden Administration when it comes to taking concrete action against the use of slave labour and the abuse of workers’ rights in countries ranging from Malaysia to Mexico. By contrast, may I ask her to name a country—one will do—with which the UK has a trade deal where she has taken any action of any kind to enforce the rights of workers?
We are extremely committed to making sure not only that we stand up for high standards across the globe, that our workers here in the United Kingdom are protected and that we do not diminish our workers’ rights, but that we work together with other countries to do that. I point to the comprehensive and progressive agreement for trans-Pacific partnership, which has a very strong labour chapter, for example insisting on minimum wages and the recognition of trade union rights. I look forward to the right hon. Lady’s support for our accession to that agreement.
The shocking reality is that more than a third of our non-EU deals have been with countries where workers’ rights are systematically denied or violated, and in not a single case has the Secretary of State done anything about it. That is not good enough when slave labour is on the rise around the world and it is women, children, migrants and minorities who are too often the victims. Will she take a lesson from the Biden Administration, stop turning a blind eye to the abuse of workers’ rights by our own trade partners and start taking action against them instead?
I am very proud of the role that the United Kingdom has played in setting very high labour standards and looking for them in the trade agreements that we are working on. That is part of our discussions with the CPTPP countries. I have also been talking to leading figures in the US about how we can ensure strong labour rights in future US agreements.
China now produces 28% of carbon emissions—more than the US and the EU combined—with more than half the world’s coal-fired power stations and a third more planned. To stop carbon-intensive Chinese products such as steel displacing greener alternatives, will the Secretary of State ensure that with the G7, at COP26 and with Katherine Tai we pursue the carbon border tax being developed in the EU so that trade can help to save the planet, not destroy it?
The hon. Gentleman makes an important point about carbon leakage. We need to make sure that when we work to achieve our net zero target, we are not simply exporting carbon production elsewhere. That is why I am working with G7 partners on the issue of carbon leakage, but I think it is important that the solution is multilateral and embedded in the world trading system rather than unilateral from each individual country, so I am working with like-minded partners across the globe to make sure that we take account of carbon emissions.
Future Trade Deals: Workers’ Rights
While the detail of free trade agreements is necessarily sensitive, we have committed in our public mandates to protecting our world-leading labour standards. For example, in our agreement in principle with Australia, a commitment was made to a chapter on labour that will lock in high domestic protections for our workers.
Colombia remains the deadliest place in the world to be a trade unionist, with 22 union activists murdered in the past year alone, according to the latest global rights index. Does the Minister now regret the agreement of a trade deal with Colombia that is so utterly toothless when it comes to the protection and enforcement of workers’ rights?
The hon. Lady will know that that was originally a deal negotiated by the EU. We provided continuity to businesses in this country and in Colombia to make sure that on our exit from the European Union, businesses could continue to trade. The truth is that some of the most vulnerable people will be affected by some of the knee-jerk policies suggested by the Labour party. In all our trade deals, we will uphold Britain’s high standards for businesses, workers and consumers, and we will continue to meet our obligations under the International Labour Organisation.
The Minister has made perfectly clear the Government’s efforts to engage with Australia on the question of workers’ rights in the run-up to the trade agreement. Countries such as Australia and New Zealand already have decent workers’ rights. However, more than half—that is, 14 out of 24—of the countries where the Government are currently negotiating trade deals have very poor track records on labour rights, including Brazil, Malaysia and India. What pressure or influence will the Government bring to bear when negotiating a deal with those countries whose labour standards and rights are extremely poor, so that the trade can benefit UK workers and the workers of our trading partners too?
Again, the question seems to have been asked and answered already. The comprehensive and progressive agreement for trans-Pacific partnership has a comprehensive labour and workers’ rights chapter, and I would have thought that the people of Preston would welcome the fact that the CPTPP offers Britain access to two thirds of the world’s middle classes by 2030.
UK-Israel Trade Deal
We have a strong bilateral trade relationship with Israel worth £5 billion a year. On my recent visit to Israel, I discussed our ambitions for a new free trade agreement to create further opportunities for British business.
My right hon. Friend will know from her visit to Israel that it has the highest number of high-tech start-ups in the world. Moreover, the latest Intel chips in all our computers were designed in Israel by Intel. Does my right hon. Friend have any plans to enhance the trading relationship in high-tech products with the state of Israel?
My hon. Friend is completely right. The UK and Israel are both leaders in technology, from agri-tech to gaming to med-tech, and there are huge opportunities for us to work together. What we will be seeking in the new trade deal with Israel is an advanced digital data and technology chapter that looks to the industries of the future to give both countries more opportunities.
I welcome the Secretary of State’s commitment to sign an advanced free trade agreement with our close ally Israel, and I hope she enjoyed her first ever visit to the country this month. Israel is a growing export market for UK companies, so what steps is she taking to champion UK-made products being sold in Israel, and what more can be done to boost UK exports of things such as cars, machinery and clothing?
The current UK-Israel partnership is already worth £5 billion a year, but we want to turbo-charge that. We are providing practical assistance for UK firms through our trade adviser network, as well as strong support from UK Export Finance to help to finance those exports into Israel.
We all welcome the prospect of an enhanced trade deal with Israel, and I congratulate the Secretary of State on her efforts to secure it. Among the many improvements that we hope the new deal delivers, will she guarantee to remove the clause mistakenly included in the 2019 UK-Israel agreement that prohibits manufacturers in UK freeports from sharing in the benefits of that deal? Can she tell us when we can expect revised deals with the 20 other countries, including Switzerland and Singapore, where the same freeport blunder still applies?
The clauses that the right hon. Lady is referring to are absolutely standard in free trade agreements. Every agreement is the result of a negotiation with the relevant country, and of course we secure the best possible outcome in terms of tariff reductions and rules of origin, but I will be absolutely clear that firms locating in our freeports are free to take advantage of whichever is better for their company: a given free trade agreement or the additional reductions from being in that freeport.
UK-India Trade Agreement
I was delighted to devise the enhanced trade partnership concept last year, and after much work across Government, the Prime Minister agreed the ETP with his counterpart on 4 May. Trade with India has averaged around £20 billion over recent years, and with its population bigger than those of the EU and US combined, the scope for growth is great, so I am looking forward to discussing our future trade deal with my new counterpart very soon.
I warmly welcome the work the Minister is doing to secure a trade agreement with the world’s fastest growing economy. Does he agree that a trade deal with India will open the door for British goods—whisky from Scotland, fine wines from the vineyards of south Wales and handcrafted gin from Warrington, the best in the world?
I am in absolute agreement with my hon. Friend and I must make a visit to Warrington to sample some of this superb gin. India is projected to be the world’s second largest economy by 2037, so the opportunities for British businesses, from financial services to pharmaceuticals, form food and drink to film and music, are huge. This people’s Government are determined to make sure that every corner of our country benefits from international trade, securing growth and creating jobs.
Future Trade Deals: Human Rights
The United Kingdom has long promoted her values globally. Although our approach to agreements will vary between partners, our strong economic relationships not only allow us to have open discussions on a range of issues, including rights and responsibilities, but secure jobs across our country, including in Hampshire.
Successive UK Governments have believed in the principle that new trade treaties should contain essential human rights clauses. That makes the whole of the treaty conditional on the commitments relating to human rights. Will the Minister confirm whether that principle remains under his Government or whether it has disappeared, along with the commitment to a 0.7% international aid target?
We promote international objectives, including rights, through a mixture of approaches. On the point the hon. Gentleman made towards the end of his question, there has been much talk about global Britain this week and trade is the route to prosperity, for Britain and her friends around the world. Although others may be content with offering only handouts, we are determined to give our friends a hand up. So having taken back control of our trade policy, I can confirm that we will be looking to go further than the EU and we will be setting out our plans and launching a consultation on this very soon.[Official Report, 19 July 2021, Vol. 699, c. 4MC.]
UK-Australia Tariff-free Trade in Agricultural Goods
There will be more UK export opportunities for our food and drink industry with the removal of all Australia tariffs. We have considered the impact of additional market access for beef and lamb on UK farmers, which has been balanced by a lengthy 15-year staging period. An independently scrutinised impact assessment will be published prior to implementation.
Patrick Krause, chief executive of the Scottish Crofting Foundation, recently made the point that the real risk for Scottish crofters from the Australia deal comes from the fact that other countries with which we do trade deals will want the same good terms that we have given to Australia. As he said,
“Crofting is good for food, and also has very impressive environmental and climate-change mitigation credentials. And crofting is about the people—crofting has maintained communities in remote rural places.”
How much of that does the Minister think will be said of the products that will be imported to replace crofted lamb?
I thank the right hon. Gentleman for his engagement and his interest. I have engaged extensively with Scottish farmers, crofters and Martin Kennedy of the National Farmers Union Scotland. I have done various roundtables with constituency MPs as well. On the impact of Australian beef and lamb imports, we think it is very unlikely that there will be a surge in imports into this country. Currently, there are strong incentives for Australia to sell into Asia. For example, the lamb quota is not currently fully used. Beef production prices in Asia are twice what they are in the UK. Australia exports 75% of its beef and 70% of its lamb to Asia, which is why I would expect that pattern to be continued. But this is also why we have built safeguards and a staging period of 15 years into the deal.
Future Trade Deals: Environmental Standards
We are seeking environmental provisions with all partners with which we are currently negotiating to ensure that future trade is sustainable and upholds the UK’s high environmental standards. The precise deals of any free trade agreement are a matter for formal negotiations.
Despite what the Minister says about calling for more control over trade, he has completely failed to advance the “polluter pays” principle through the carbon border tax, failed to advance the agenda at the G7, failed to put it into any of the trade agreements that he has drawn up and failed to put it into any of the negotiation frameworks that he is currently discussing. Can he tell me whether he will fail at the next stage when it comes to COP26? Is he already engaged in pre-negotiation talks with all the partners, and how will the principle fare on the COP26 agenda when the summits meets in November?
We take a strong interest in carbon leakage and in how trade deals with carbon. We are studying carefully, for example, EU proposals on the carbon border adjustment mechanism. At the World Trade Organisation in general, we are looking to advance our environmental agenda. The hon. Lady will know of the different measures taken by the UK Government; for example there is the UK global tariff, which reduced and eliminated tariffs on 104 environmental goods. We are also seeking good environmental chapters in all of our future free trade agreements.
Thank you for sneaking me in, Mr Speaker.
Today, we heard the devastating news that the Amazon is now a carbon source rather than a carbon sink. With deforestation at a 12-year high, it is emitting more CO2 than it absorbs. Is the Minister following the progress of the land-grabbing legislation, which has been dubbed the destruction package, that is going through the Brazilian Parliament at the moment? What discussions has he had with his counterparts, and what impact would that have on trade negotiations with Brazil? May I urge him to rule them out if this package goes through?
We are not currently negotiating a trade agreement with Brazil. We follow the position in Brazil very closely, and we engage strongly on a bilateral basis on all of these issues with the Brazilian Government. We have very good diplomatic representation not just in Brasilia but across different parts of Brazil, to make sure that the UK position and the importance of deforestation for the UK, particularly in this COP26 year, is upheld.
The United States is our largest single country trading partner and an important ally. We have already made progress in the Airbus-Boeing dispute, getting tariffs removed on great British products such as machinery and whisky. I am now working closely with my US counterparts to tackle global issues on steel, aerospace and technology to make sure that trade is fair as well as free.
We are six months into Brexit and the sea of opportunity that the seafood producers of my Argyll and Bute constituency were promised has turned out to be swamp of bureaucracy. Alongside a mountain of paperwork and red tape, they all report falling prices, loss of markets, labour shortages and major transport and logistical problems. Six months into Brexit, they are facing an existential crisis. How has the Secretary of State’s Department allowed that to happen?
We have seen trade with the EU bounce back after some initial issues. In particular, the Department for Environment, Food and Rural Affairs has offered support to seafood producers to ensure that they have what they need to be able to deal with those issues.
My hon. Friend is correct. The Australia deal is a fundamentally liberalising agreement that removes tariffs and supports millions of jobs. It will strengthen the bonds of friendship—I speak as the parliamentary president of the Conservative Friends of Australia—for example by championing youth mobility, which he referred to. The deal also paves the way for joining the comprehensive and progressive agreement for trans-Pacific partnership and the growing middle-class markets of the Pacific rim. We are realising the vision of a global Britain that looks to one of the most dynamic trading areas in the world.
HSBC is an extremely important company and employer in this country. I do not have a problem with Ministers meeting HSBC, let us put that on the record. The hon. Gentleman will also be aware of the very strong action we have taken in relation to China and the measures announced by the Foreign Secretary in this House in January in relation to supply chains in Xinjiang and actions in Hong Kong, which had broad agreement across the House. We will continue to make vigorous representations in relation to China, and we are monitoring the situation very closely.
My hon. Friend is absolutely right. Services are 80% of the UK economy. We are the world’s second largest exporter of services, and a huge number of those are digitally enabled. The digital economy agreement between the UK and Singapore will be a model for global digital trade rules, and I met Singapore Minister Alvin Tan just yesterday to discuss it. Singapore is a global leader in this area. We are looking forward to signing an excellent agreement with Singapore.
We are following developments on the EU carbon border adjustment mechanism closely. The UK has ambitious carbon pricing through our emissions trading scheme and carbon price support mechanism, and we expect the EU CBAM to take account of that in its implementation. The COP President-designate, my right hon. Friend the Member for Reading West (Alok Sharma), has said that he does not anticipate carbon border adjustment mechanisms becoming an issue within the COP26 negotiations.
I congratulate my hon. Friend on her championing of her constituency and Cornwall’s farmers. We are opening markets, as we have discussed. We are activating farmers with our “Open Doors” campaign, and we are grateful for the support of the National Farmers Union and the Agriculture and Horticulture Development Board. We have a mentoring scheme, which I was delighted to launch in the south-west, and we are leading trade missions such as “Spring into Japan”, to make sure that on a greater scale than ever before we are engaging more farmers’ produce with global markets, leading to jobs and prosperity in her constituency and beyond.
We have been absolutely categorical in our commitment on food standards and food safety standards. There will be no compromise on UK standards in relation to any trade agreement. That has been the case—[Interruption.] Our commitment is absolute. If the hon. Member were to take a look at all the trade agreements we have done with 67 countries—if she looked at the Australia trade deal agreement in principle and the Japan deal—she would see no diminution in our food safety and animal welfare standards so far.
I can absolutely give that commitment to the people of Delyn. The Government have been very clear that any trade deals must work for UK consumers and businesses, upholding our high regulatory standards. The Government, as I mentioned earlier, have manifesto commitments to no compromise on standards in animal welfare, food safety and the environment.
The Secretary of State had a successful visit to Israel herself in the last week of June, and she had productive discussions with her Israeli counterpart, focused on ambitions for upgrading our current trade relationship. As my hon. Friend suggests, I am very keen personally to strengthen our £5 billion trade relationship even further, and I look forward to taking these discussions forward to create further opportunities for British businesses in tech and beyond.
We will be responding in due course to the call for input on going further on a trade deal with Canada, and we are looking forward to that negotiation starting in the autumn. I would remind the hon. Member that there are no ISDS provisions in the UK-Australia deal, but I would also remind her that the UK has never lost an ISDS case. We do have ISDS provisions in quite a number of our existing agreements, and the UK has never lost any such case.
I thank my hon. Friend for his excellent question. I am tremendously proud of UK Export Finance and its staff for the innovative way in which they have responded to the pandemic, with the record level—more than £12 billion—given to UK businesses supporting more than 100,000 jobs up and down the country. Behind those 549 companies, of course, stand 10,000 or more supply chain companies. UKEF, at no cost to the taxpayer, makes an enormous difference to the prosperity and success of this country.
My Department continues to defend the interests of British industries in all parts of the United Kingdom. The Secretary of State is currently in the United States building on the historic arrangement that we secured in the Airbus-Boeing dispute, ensuring that the British aerospace sector can take off again after covid-19. Confidence in our fantastic aerospace manufacturing capability has never been at such heights. The United Airlines order of 70 A321neo aircraft last month will feature wonderful Welsh-made wings, and I look forward to further success in the future.
Does my hon. Friend agree that the Government’s ambitious strategy for growing exports needs to include more agricultural councils in our embassies, a UK export council to help co-ordinate that strategy, and better promotion and marketing of brand Britain abroad so that we can ensure that farming and food companies in Eddisbury and right across the country can embrace the undoubted benefits and opportunities that UK free trade deals can deliver?