Trade Agreements — House of Lords, 2019-02-14
Topic: Foreign Trade
Robert Stevenson (Labour, Centre-left): My Lords, I am grateful to the Minister for repeating as a Statement the Answer to the UQ in the other place yesterday. The mystery which this Statement is supposed to address is why there is such secrecy about progress on the rollover of existing EU FTAs. It was always going to be much harder than was ever promised; it was always going to take time, and it has; and, as the Minister said, it was always going to be up to the last minute, so we should not be surprised by anything that has been leaked to the papers. Having said that, it is good to see the leaked report because it gives some clarity to what is otherwise a rather obscure situation If the Minister will forgive the comment, the Statement still has Micawberish undertones. It has been clear for many months that, at best, only a very small number of agreements will be in force if we leave without a deal on 29 March. It is also becoming clearer that the focus on these 40 EU FTAs with 70 or so countries is a bit of a distraction. Even counting the Japan agreement that recently came into force, although it takes a number of years to have its full effect, we are talking about 16% of our overall gross imports and about the same—16.5%—of our gross exports, so it is a small proportion of our overall trade If you go a bit further into these EU FTAs, over 80% of their value is provided by some six of them. Obviously, they are important but they are not that important, particularly when you go further into what they comprise. The much-vaunted Swiss agreement accounts for a very large proportion of the six that provide 80% of the value but it is in a very restricted sector—pearls, precious metals and jewellery. Therefore, we have to understand a much wider issue. The majority of the EU FTA agreements and the ones that account for 80% of their value deal with precious metals, pearls, jewellery and mineral fuels. They do not supply food or medicines—the sorts of things that will be in short supply if we crash out on 29 March To focus a little more on the wider context, can the Minister now confirm clearly to the House that, if there is a withdrawal agreement, after 29 March 2019 the UK will be a third country, no longer participating as an EU member, and that it will have to rely on the EU’s promise to notify its current partners that the UK is to be treated as a member state? But of course that will be entirely up to the countries concerned and, as things stand, a very small number of the agreements with those countries will be in place on 29 March If there is no deal and we leave on WTO terms, the crucial question that is missing from this whole discussion is: what tariffs will be applied when we leave? Can the Minister confirm when we will get some information about the tariff rates that will be applied? We gathered from the exchanges yesterday in another place that the much-touted story over the weekend that the Government would go for zero tariffs has no credibility. The Minister in the other place said that that would not be the case. Can the Minister also confirm that the Government will announce the tariffs very shortly? If so, when will that be?