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G20 Summit

Volume 794: debated on Monday 3 December 2018


My Lords, with the leave of the House I shall now repeat a Statement made in another place by my right honourable friend the Prime Minister. The Statement is as follows:

“With permission, Mr Speaker, I would like to make a Statement on the G20 summit in Argentina. Before I do, I would like to put on record my thanks to President Macri for hosting such a successful summit. This was the first visit to Buenos Aires by a British Prime Minister and only the second visit to Argentina since 2001. It came at a time of strengthening relations between our two countries when we are seeking to work constructively with President Macri.

As we leave the European Union, I have always been clear that Britain will play a full and active role on the global stage as a bold and outward-facing trading nation. We will stand up for the rules-based international order, strive to resolve with others challenges and tensions in the global economy, work with old allies and new friends for the mutual benefit of all our citizens and remain steadfast in our determination to tackle the great challenges of our time.

At this summit, we showed that the international community is capable of working through its differences constructively, and the leading role the UK will continue to play in addressing shared global challenges. We agreed —along with the other G20 leaders—on the need for important reforms to the World Trade Organization to ensure it responds to changes in international trade. We pursued our objective of making sure that the global economy works for everyone and the benefits are felt by all. We called for greater action in the fight against modern slavery and tackling climate change. I held discussions with international partners on security and economic matters, including on the progress of our exit from the European Union and the good deal an orderly exit will be for the global economy.

Let me take each of these in turn. At this year’s summit, I came with the clear message that Britain is open for business and that we are looking forward to future trade agreements. Once we leave the EU, we can and will strike ambitious trade deals. For the first time in more than 40 years, we will have an independent trade policy, and we will continue to be a passionate advocate for the benefits that open economies and free markets can bring. We will forge new and ambitious economic partnerships and open up new markets for our goods and services in the fastest-growing economies around the world. During the summit, I held meetings with leaders who are keen to reach ambitious free trade agreements with us as soon as possible. This includes Argentina, with whom I discussed boosting bilateral trade and investment, and I announced the appointment of a new UK trade envoy. I also discussed future trade deals with Canada, Australia, Chile and Japan, with which we want to work quickly to establish a new economic partnership based on the EU-Japan Economic Partnership Agreement.

On the global rules that govern trade, we discussed the importance of ensuring an equal playing field and the need for the rules to keep pace with the changing nature of trade and technology. There is no doubt that the international trading system, to which the United Kingdom attaches such importance, is under significant strain. That is why I have repeatedly called for urgent and ambitious reform of the World Trade Organization; at this summit, I did so again. In a significant breakthrough, we agreed on the need for important reforms to boost the effectiveness of the WTO, with a commitment to review progress at next year’s G20 summit in Japan.

On the global economy, we recognised the progress made in the past 10 years, with this year seeing the strongest global growth since 2011; but risks to the global economy are re-emerging. In particular, debt in lower-income countries has reached an all-time high of 224% of global GDP, so I called on members to implement the G20 guidelines on sustainable finance that we agreed last year, which increase transparency and encourage co-operation. At this year’s summit, I continued to pursue our mission to make the global economy work for everyone and the need to take action in our own countries and collectively to ensure that the benefits of economic growth are felt by all.

Around the world, we are on the brink of a new era in technology which will transform lives and change the way we live. This has the potential to bring us huge benefits, but many are anxious about what this means for jobs. That is why in the UK, alongside creating the right environment for tech companies to flourish through our modern industrial strategy, we are investing in the education and skills needed so that people can make the most of the jobs and opportunities that will be created. We made strong commitments to improving women’s economic empowerment, and alongside this I called on G20 leaders to take practical action to ensure that by 2030 all girls, not just in our own countries but around the world, get 12 years of quality education.

To build fair economies and inclusive societies we must tackle injustice wherever we find it. Around the world, we must all do more to end the horrific practice of modern slavery, and protect vulnerable men, women and children from being abused and exploited in the name of profit. Two years ago I put modern slavery on the G20 agenda at my first summit and this year I was pleased to give my full support to the G20’s strategy to eradicate modern slavery from the world of work.

I announced that next year the Government will publish the steps we are taking to identify and prevent slavery in the UK Government’s supply chains in our own transparency statement. This is a huge challenge. Last financial year, the UK Government spent £47 billion on public procurement, demonstrating just how important this task is. I urged the other leaders around the G20 table to work with us to ensure that their supply chains are free from slavery as we work to bring an end to this appalling crime.

I made clear the UK’s determination to lead the way on the serious threat that climate change poses to our planet. We need a step change in preparing for temperature rises, to cut the cost and impact of climate-related disasters, and to secure food, water and jobs for the future. As a UN champion on climate resilience, the UK will continue to pursue this agenda at next year’s UN climate summit. Nineteen of us at the G20 reaffirmed our commitment to the Paris agreement, but it remains a disappointment that the United States continues to opt out. I also announced that the UK will be committing £100 million to the Renewable Energy Performance Platform, which will directly support the private sector in leveraging private finance to fund renewable energy projects in sub-Saharan Africa.

This summit also gave me the opportunity to discuss important matters directly with other leaders and raise concerns openly and frankly. In that context, I met Crown Prince Mohammad bin Salman; first, to stress the importance of a full, transparent and credible investigation into the terrible murder of Jamal Khashoggi and for those responsible to be held to account, a matter which I also discussed with President Erdoğan; and, secondly, to urge an end to the conflict in Yemen and relief for those suffering from starvation, and to press for progress at the upcoming talks in Stockholm. Our relationship with Saudi Arabia is important to this country, but that does not prevent us putting forward robust views on these matters of grave concern.

I also discussed the situation in Ukraine with a number of G20 leaders. The UK condemns Russian aggression in the Black Sea and calls for the release of the 24 Ukrainian service personnel detained and their three vessels.

At this year’s summit we reached important agreements, demonstrating the continued importance of the G20 and international co-operation. It also demonstrated the role that a global Britain will play on the world stage as we work with our friends and partners around the world to address shared challenges and bolster global prosperity. I commend this Statement to the House”.

My Lords, I thank the noble Baroness the Leader of the House for repeating today’s Statement. Aboard her flight to Buenos Aires, the Prime Minister told waiting reporters that she was off to sell UK trade to world leaders. It is hard to understand what exactly the Prime Minister means by this, considering that we have no idea what our trading status will be after March. The Government’s withdrawal agreement looks set be voted down, a third of the Prime Minister’s own trade envoys oppose her plans for future trading arrangements, and, with the Attorney-General refusing to publish his full legal advice on the backstop, it is fair to say that we are a long way off negotiating any kind of trade policy. Yet we are told that, from Canada to Japan, one by one the Prime Minister sat down with world leaders to set out future trade deals. I hope that the noble Baroness will say a little more about this and detail to the House exactly what the Prime Minister could have discussed in these bilaterals.

We are told that trade at least was not on the cards during the Prime Minister’s bilateral with Crown Prince Mohammad bin Salman. Did she have a frank discussion over the UK’s sale of arms for use in the brutal Yemeni civil war? The UK is not a spectator; as long as we are selling arms to be used in that war we are very much involved. The Prime Minister says in her Statement that one of the reasons for the meeting was,

“to urge an end to the conflict”.

Surely we can do better than that. Crucially, the Prime Minister needs to put an end to the flow of British arms for use in this civil war. It is now time for action. We have a moral obligation to help the people of Yemen. Ahead of the Stockholm talks in the coming days, the Government should do everything possible to bring about a permanent end to the barbaric bombardment of Hudaydah. As an urgent priority, she needs to fully support humanitarian relief to find a route to allow food and medicine to reach the 14 million starving Yemenis. Can the noble Baroness the Leader tell us whether any of these issues were raised by the Prime Minister in her bilateral meeting?

We welcome confirmation that the Prime Minister raised the murder of Jamal Khashoggi with the Crown Prince. During the summit, President Macron told the Crown Prince that international experts must be part of the investigation. Turkey called for a full UN-led investigation into the incident. We are told that the Prime Minister asked for transparency. Can the noble Baroness expand on this and clarify what the Prime Minister’s exact demands are for the Khashoggi investigation?

Prior to the summit, it was well briefed that the Prime Minister would use the trip to engage in a new security partnership as part of her preparations for the UK’s new satellite system that would rival Galileo. That raises several immediate concerns. What will be the cost of creating a new, separate system? Will it be as effective and will we have full access by 2026, as was the plan with Galileo? Despite all the pre-briefing, there is nothing in the Statement. Can the noble Baroness confirm that, given all the pre-briefing, it was discussed at the summit?

On climate change, the Prime Minister told the summit that the UK was determined,

“to lead the way on the serious threat that climate change poses to our planet”,

to quote from the Statement. That is a worthy aim, but it needs more than just words. For example, did the Prime Minister urge President Trump to reconsider his rejection of the Paris agreement in her informal discussions with him?

Aside from the bilateral meetings, after hours of negotiations it emerged on Saturday that the G20 had agreed a joint communiqué that reaffirmed the commitment to a rules-based international order, which I am sure all of us would welcome. However, we need just to scratch the surface of the declaration and we see that the actions of some of the signatories are at odds with the spirit of the agreement. The UK has a responsibility to support and to defend these values of multilateralism, and the Prime Minister must encourage our international partners to do the same.

Against the backdrop of the communiqué, the US and China agreed a trade war truce, which the White House has labelled “a wonderful humanitarian gesture”. However, apparently this “wonderful humanitarian gesture” includes support for the expansion of the death penalty in China for those importing the opiate drug fentanyl to the US. Meanwhile, in the face of Russia’s arrest of Ukrainian soldiers, Kiev has suggested that democratic elections could be suspended. Neither of these is consistent with the principles of a rules-based international order.

The Prime Minister must seek to use any influence the UK has to encourage all countries to genuinely and honestly abide by this agreement in both domestic and international policy. There has to be real value to such summits. For that to be the case, the communiqué cannot be just warm words to be discarded when they are inconvenient.

My Lords, I too thank the Leader for repeating the Statement, but am rather disappointed that it contains an omission. We are told that all the leaders had a bit of downtime during their stay in Argentina, during which they demonstrated national character traits. Angela Merkel went to a steak house for a good meal; President Macron went to a bookshop for a meeting with writers and thinkers; and President Modi held a public yoga session in front of several thousand—no doubt somewhat surprised— Argentinian residents. Can the Leader tell us what the Prime Minister did to reflect our current national mood and character?

More seriously, the Statement contains a number of references to Brexit which are rather curious. First, it says that the Prime Minister held discussions on,

“the good deal an orderly exit will be for the global economy”.

How is that compatible with the Government’s own long-term economic analysis, published last week, which showed that even if the Government get free trade agreements with every single country with which they do not currently have one, there will be a reduction in GDP in the UK because there will be a reduction in trade? The inevitable corollary of that is that there will be a reduction in GDP in the rest of the world because there is a reduction in trade.

Secondly, the Prime Minister said:

“Once we leave the EU, we will strike ambitious trade deals”.

Given that the EU has rejected the Government’s proposal for a facilitated customs agreement, how can we strike trade deals on our own while keeping a frictionless border in Northern Ireland? The Prime Minister had specific discussions on trade with a number of Heads of State and Government, including that of Japan. In her conversations with the Japanese Prime Minister, did she discuss the commitment given to Nissan some two years ago guaranteeing that it would be no worse off under Brexit? If so, what assurances did she give, or could she give, to Japanese companies in the UK that they would not face additional barriers to trade, particularly those working in the services sector, not least the financial services sector, after Brexit?

Finally, the Prime Minister said that the UK was,

“creating the right environment for tech companies to flourish”,

after Brexit. Why then does the Prime Minister think that, last week, a letter was delivered to 10 Downing St signed by more than 2,300 tech entrepreneurs warning that, under the Government’s plans for Brexit, the industry would be hit by a drastic reduction in market access and difficulty in attracting new talent and investment from outside the UK?

The Prime Minister is living in a fantasy world increasingly at odds with reality. Fortunately, with next week’s votes, reality is about to intrude.

I thank the noble Baroness and the noble Lord for their comments. Both of them asked about the conversations that the Prime Minister had on trade. In her bilateral with President Abe, both leaders reaffirmed our commitment to work quickly to establish a new economic partnership between Japan and the UK in the future based on the EU-Japan Economic Partnership Agreement. She met Prime Minister Morrison of Australia for the first time at the summit, and we are stepping up engagement with the Indo-Pacific, with new missions in Samoa and Tonga and an enhanced relationship with ASEAN. We also laid the foundations for an ambitious future UK-Australia free trade agreement. The Prime Minister also met President Piñera of Chile. They welcomed the constructive discussions to date on transitioning the current EU-Chile agreement and reaffirmed the commitment of both sides to conclude it swiftly. The Prime Minister also held talks with Prime Minister Trudeau. She therefore had a lot of constructive engagement with our global partners.

As the Statement made clear, for the first time in more than four decades, we will have an independent trade policy working through the WTO. As we have said on numerous occasions in the House, during the implementation period we would be able to negotiate, sign and ratify deals across the world.

The noble Baroness, Lady Smith, rightly asked about the situation in Yemen. I assure her that we are fully focused on bringing an end to hostilities there to address the worsening humanitarian crisis and build a lasting political solution. Diplomacy and negotiation remain the only path to ending the conflict. The indications are that, in the coming days, the sides will come together in Stockholm to hold meaningful talks. They open a window of opportunity to work with all parties towards a cessation of hostilities. The Prime Minister made that point forcefully to the Crown Prince in her bilateral with him. The noble Baroness will also know that the UK is the fifth largest donor of humanitarian assistance to Yemen this year. We have committed £570 million since the conflict began.

The noble Baroness asked also about the Prime Minister’s conversation with the Crown Prince about Jamal Khashoggi. She stressed again the importance of ensuring that those responsible for the murder are held to account and that Saudi Arabia takes action to build confidence that such an incident could not happen again. She made it clear that both the Turkish and Saudi investigations should be carried out thoroughly until responsibilities were clearly established, and that there should be proper accountability and due process for any crimes committed. She made it clear also that we expect Saudi Arabia to take measures to ensure that such violations of international and national laws do not happen again. We have also been clear that we will work with the EU and member states to consider how we can act together to take appropriate measures against those responsible once the investigations have concluded.

Our defence export procedures are among the strictest in the world. A licence will not be issued to Saudi Arabia or any other country if to do so would be inconsistent with any provision of the consolidated EU and national arms export licensing criteria. In July 2017, the High Court ruled that our sales to Saudi Arabia were compliant with those regulations.

The noble Baroness asked also about the Paris agreement. Certainly, the Prime Minister has had a number of conversations about it with President Trump and has urged him not to withdraw. We remain committed to the Paris agreement and were pleased that the other 19 members of the G20 all reinforced their strong commitment to it. The noble Baroness will know that the UK is decarbonising more quickly than any other G20 country and is honouring its climate finance commitments. At the G20, the Prime Minister announced £100 million for the renewable energy performance platform to support small-scale renewable energy projects in sub-Saharan Africa.

The noble Baroness rightly talked about some of threats faced by our rules-based system. We are clear that we are committed to upholding it. Despite difficulties, the G20 provides an opportunity collaboratively and openly to discuss the challenges. The system is being openly questioned, so we must redouble our efforts to defend it. That involves delivering UN reform, fairer burden-sharing in NATO and reform of the WTO—which was a part of the discussion at the G20. The World Bank’s governance must change to reflect the changing balance of the global economy. There need also to be reforms within the decision-making process of the Commonwealth. There is much to do, but it was a constructive summit and a communiqué was agreed by consensus.

My Lords, in the context of the reference in the Statement to the need for an orderly exit from the European Union, can my noble friend help me on the following point? We know that the UK Government are making preparations for the possibility—some might say the probability—of a no-deal Brexit. The European Union is making similar preparations. Are those preparations being co-ordinated in any way? If not, why not?

We remain committed to the deal that we have negotiated with the EU and believe that it is the best deal, but my noble friend is absolutely right: both we and the EU are preparing for no deal. There have been many conversations, both bilaterally and with the EU, about preparations. We are taking forward our plans, as are the Europeans, but certainly conversations have been had.

My Lords, will the Minister accept a warm welcome for the reference in the communiqué to supporting a rules-based international order, even if some of the signatories are somewhat unlikely supporters of that proposition? I welcome the Prime Minister’s efforts on that, with many of her colleagues. I have two questions. Reform of the World Trade Organization is obviously a sensible way to go, but the United States has made no secret of the fact that it wishes to dismantle the dispute settlement procedures of the World Trade Organization, so will the noble Baroness say that the Government will under no circumstances accept a weakening of the dispute settlement proceedings and will, indeed, think about ways of circumventing the US tactic of failing to appoint new members to the panel? On migration, there are two rather obscure passages in the communiqué —paragraphs 17 and 18. Will the noble Baroness say how Britain is going to be represented next week at Marrakesh at the meeting to sign up to the UN compact on migration?

I thank the noble Lord. He is right that there was agreement that reform is needed to improve the WTO’s functioning. A step forward was that progress on this will be reviewed at the next G20 summit. The G20 has given the WTO a strong mandate for reform and we now want to see everyone working together. I can certainly assure him that our priorities for WTO reform include ensuring the continued effectiveness of the dispute settlement mechanism, including the role of the appellate board. We want to enhance transparency in the system to improve trust and to enhance the rules by ensuring clear disciplines on distortive subsidies and state-owned enterprises. We will be taking these forward strongly. He asked about migration. I can say that we will indeed be at the upcoming intergovernmental launch of the global compact. We support this compact, both in terms of international co-operation and as a framework to help us deliver our commitments under the sustainable development goals.

My Lords, in view of the rather chaotic state of the Government, this might seem a slightly premature question, but the Statement refers to various attempts to make deals with other countries on trade. There are some interesting references to how that might be done. Given that we are going to be a rule taker from the EU for quite some time—some of those rules are very good: data protection rules, for example, are of a very high standard—is it our intention to negotiate trade deals with other non-EU countries using those rules, or are we going to have different rules for every country we negotiate a deal with?

Obviously, we will have discussions with different countries and work out trade deals that work best for both parties, but we have been very clear that we will not be lowering our standards in a whole array of areas, because we have been world leaders in setting them and we want to remain so.

Does my noble friend agree that this summit and the Commons Statement are remarkably forward looking—although one would not guess it from some of the curmudgeonly responses we have heard? Does it not mention both future trade deals under an independent trade policy, fundamental changes in the nature of trade, which do not seem to have reached a number of people talking about the subject, new areas of technology, women’s economic empowerment and, as we have already mentioned, the benefit of orderly exit from the EU? Should not excitable Brexiteers, and indeed the opposition parties, reflect a little on all that is really happening and important in the world before they try to destroy the Prime Minister’s perfectly sensible compromise?

I thank my noble friend. As I mentioned in my answer to the noble Baroness, a communiqué was adopted by consensus at this G20, which showed the constructive nature of the meeting. Of course, the G20 is vital to international economic co-operation. It brings together countries that collectively constitute 85% of gross world product and two-thirds of the world’s population, so it is essential that we continue to work collaboratively together to tackle some of the global issues that we all face.

My Lords, I welcome the Statement, most particularly on modern slavery. May I ask that this issue be placed on the agenda of all meetings of the Prime Minister and Ministers when they talk to other countries about trade agreements? It is vital because, although we like to think that modern slavery is ceasing, it is not: it is actually on the rise, particularly in America itself. Perhaps pressure could be put on the American Government as well.

Secondly, I welcome the Statement on women’s empowerment. As we know, more and more women are going to be in difficulties with climate change, because it is women who will be most affected by climate change, in terms of their work: those who work in agriculture will have to walk much further to get water and those who have certain jobs will have to move because of climate change. Women and children will be most affected, so we need further education money, some of which should be used for education in whatever place they have to move to. It should be remembered that people do not leave where they live because they want to but because they have to, so they must be respected as refugees.

I thank the noble Baroness for her comments. I am sure she will recognise that two of the issues she raised are very close to the Prime Minister’s heart and that she has been a leader internationally in these areas. On modern slavery, the call to action has now been endorsed by more than 80 countries, including 13 of the G20, and we will continue to push that forward. We were very pleased with the G20 strategy as a positive step to tackling modern slavery and reducing exploitation. Indeed, it set out a number of commitments, particularly around global supply chains, where modern slavery unfortunately remains rife. The noble Baroness may well also know that Australia, for instance, is introducing legislation based on our Modern Slavery Act; so we are indeed leading the world and we will continue to push for this. As she rightly said, we will focus on empowering women and on gender equality: that remains a priority for DfID.

My Lords, I very much welcome the Statement and in particular the focus on future trade arrangements. However, before we get carried away with the future, will my noble friend take a moment to update the House on the progress that the Government have made on grand- fathering over existing EU/non-EU trade agreements? It is imperative that this is done before we leave. Furthermore, how are we doing with grandfathering over the 750—at the last count—trade-related agreements with 168 countries that are also important to keep trade flowing?

I do not believe that that kind of detail was discussed at the G20, but I am very happy to investigate further and write to my noble friend.

My Lords, I am not sure that the Leader of the House answered my noble friend Lady Smith’s point about a replacement for the Galileo system, which was highly trialled as being one of the subjects under discussion. Given that, as I understand it, to have a proper global positioning system you have to have in the air around 24 satellites, how quickly is this going to happen and what is going to be the cost to the United Kingdom? What progress was made in discussing this with other nations?

As I said in a couple of previous EU Statements, we are developing our own system. Galileo was apparently not discussed in the G20 plenary sessions.

My Lords, I think the noble Baroness said that we were giving £570 million of aid to Yemen, which is obviously wonderful—but of course we are also supplying bombs that have caused the damage in the first place. There is very strong evidence that some of the arms that we export go straight to Yemen and cause the trouble that we are now trying to put right. What really happened at the discussion—the cosy fireside chat—with the Crown Prince about how not to murder people in too public a way and how to cut the arms down? I think that most other countries that were there were probably trying to avoid talking to the Crown Prince because of what has happened there.

I think we need to engage with people in order to change their opinion and to put our ideas over forcefully. I do not think that avoiding difficult discussions is a particularly good way forward. As I said, the Prime Minister raised the issue of Yemen with the Crown Prince. There is a window of opportunity now, through the talks that we hope will start in the next few days in Stockholm, where we can bring the parties together. We want them to work in good faith in order to cease hostilities. As I said, we have committed £570 million since the conflict began in 2015. We are the fifth-largest donor of humanitarian assistance and we are working with our international partners to try to bring this conflict to an end—but I think that robust conversations are needed in order to make sure that these points are forcefully put across.

My Lords, although we can indeed strike new trade deals when we leave the EU on 31 March, is not the bitter truth that they remain no-deals until they can be implemented, and that they will not be able to be implemented until the implementation period ends and we have not joined the backstop?

As I have said, during the implementation period we will be able to negotiate, sign and ratify trade deals, and we will be able to bring these into effect after the implementation period. If the backstop were ever to come into effect—which of course no one on either side wants—we would be able to enact those aspects of trade agreements that do not affect the functioning of the backstop, such as services, investment, financial services and digital.