Motion to Take Note: Commonwealth

16th March 2017– Contribution by Lord Waverley 

My Lords, I rise with nostalgia. My first endeavour as a new boy in your Lordships’ House was to table a Motion calling attention to the importance of the Commonwealth. I warmly encourage closer working relationships with the Commonwealth, noting that the UK enjoys reciprocally beneficial membership of this invaluable intergovernmental organisation of, as the Minister reminded us, more than 2 billion people in 52 countries spanning six continents.

The UK has received unstinting support over the decades—including in military conflicts, disaster relief and its role as a permanent member of the UN Security Council—from the Commonwealth family of nations. Our distinguished Commonwealth partner country, Malta—now president of the Council of the European Union—hosted the most recent Heads of Government meeting in 2015, exploring the theme of “The Commonwealth: Adding Global Value”. It was a timely and relevant theme for this leading Commonwealth country—ours—as we stake out the Brexit ground. We, too, must seek to add value globally.

When we joined the EEC in 1973, our formal bilateral trade, aid and investment relations with Commonwealth countries—the Commonwealth preferences scheme—ended. Picking up a theme of the Minister, subsequently, under the Lomé convention, the Cotonou agreement and the economic partnership agreements, Commonwealth trade was notionally with the EU but headed primarily for British markets.

Political hay has sometimes been made of punishment that the UK might receive because of our vote in the recent referendum. Will any such punishment extend to our Commonwealth partners? Thirty-six of them are small countries with small markets lacking the negotiating clout to fight their corner with the Commission. Will Malta and Cyprus, joint EU and Commonwealth members, help them to consolidate their position, or will they be hampered by their own small state status? It is possible—I put this thought in the minds of government negotiators—that we can create a Commonwealth free trade area compliant with WTO rules. However, that would require considerable political will and expertise to modify existing rules of other customs unions to which members may also belong.

There is both an economic and a moral imperative to address this issue during the impending Brexit negotiations and beyond. Media reports sometimes dismiss Commonwealth trade potential, yet intra-Commonwealth trade could reach US $1 trillion by 2020, as the Minister also reminded us.

Opportunities await us. Commonwealth target growth sectors are financial services, technology, infrastructure, healthcare, tourism and sustainability. We in the UK are leaders in each and every one of those fields. Consider the welcome impact we could have in ensuring greater access to green technologies across the Commonwealth, particularly in areas plagued by natural disasters and sea level rise attributable to climate change.

Our expertise in the field of education is well recognised, as are the financial, research and cultural contributions to our country of increased numbers of international students and faculty—in significant numbers, from Commonwealth countries. Not only can this sector be enhanced here at home, but there is also significant comparative advantage for exports of technology, expertise and institution-building skills.

There exists much scope for our SMEs to enter and thrive in those Commonwealth markets, with access and performance eased by harmonised legal, regulatory and language frameworks—a happy circumstance described as “the Commonwealth advantage”. Many SMEs have not exported to the EU in part because of bureaucratic burden. They could and should now seize every opportunity offered for trade within the Commonwealth. I welcome the inaugural Trade Ministers meeting and the recognition of the timely benefits of improved intra-Commonwealth trade, industry and investment. The secretariat and the CFTC are well placed to co-ordinate Commonwealth business requests centrally, while Her Majesty’s Government can officially support Commonwealth development finance initiatives, such as the trade finance facility, that dovetail with their own. That is mutually beneficial.

Why is it important to engage at this level? There is far more at stake here than just the trade numbers, attractive though they are. The Prime Minister of Malta, speaking to Heads of Government at the most recent CHOGM, reminded us of the Commonwealth’s youth who, just like ours, can easily become aggrieved by being out of the loop, alienated by lack of respect, a poor standard of living and unemployment—and as easily seduced by extremist propaganda. Prime Minister Muscat pointed out:

“Terrorists are more scared of well-educated girls and boys who manage to get a good job than they will ever be of any army”.

Look no further than to the heartrending affair in Nigeria’s north-east.

We therefore have a shared interest in seeking to improve education and job opportunities for our young at home and, importantly, across the Commonwealth. To do so would assist in reducing migration—irregular or otherwise—by mitigating the conditions propelling peoples to flee their home countries. In turn, perilous journeys to the European mainland could be reduced, far right policies would have less traction and people traffickers would be put out of business. That is a win-win situation, well within our grasp.

I conclude, as I did in 1994, with the wisdom of Mr Arnold Smith, the first Secretary-General of the Commonwealth, when he remarked:

“100 years from now, I suggest, historians will consider the Commonwealth the greatest of all Britain’s contributions to man’s social and political history”.

I trust that today, the message will travel Commonwealth-wide: your partner and friend is back.

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Question for Short Debate: Exports: Africa and the Commonwealth

27th November 2017 2018 – Contribution by Lord Waverley

My Lords, I offer a warm welcome to the Minister and should let her know that we are here to help—although on occasion it might not seem so. I congratulate, too, the noble Lord, Lord Popat, on securing this debate. One of the great joys in life is waking up to an African dawn.

Notwithstanding the continued march of globalism, cross-border global trade remains plagued by multiple barriers. These impede economic development in emerging economies, and particularly in small and medium-sized enterprises which take disproportionately little in world trade. The challenge has to be to address the factors that inhibit or prevent SMEs from exporting. A number of overarching principles ought to be considered central to increasing cross-border trade. These include targeting policy, especially towards SMEs and emerging markets, constructing policies in consultation with key stakeholders, growing an export culture, and raising international ambition, particularly through government briefings, school education, the improved teaching of modern languages and advisory services. I would encourage the Minister to have her team examine, if it is not already doing so, the range of existing policies and best practices from around the world, particularly on the challenge of removing informational asymmetries between market participants.

Trade is a multidimensional process that is based on four primary pillars: logistics, commerce, finance and insurance. But there is little linking within global value chains. More importantly, while the world is digitising many of its processes, this is being done in piecemeal fashion. Much of the progress to date has been between business and consumers, with relatively little from business to business. The core element, logistics, is the weakest link. The logistics industry as a whole is generally fragmented and inefficient. While some individual companies’ logistics are digitised—for example, the likes of FedEx and DHL—this has generally been done only vertically within each large company or has been limited to specific tiers within a supply chain. A horizontally integrated world trade digital economy platform would bring considerable benefits.

The digitisation and integration of these four elements, underpinned by a multidimensional platform, would bring efficiency gains, substantial reductions in the cost of trade and an expansion in the volume of world trade. The economic, social and developmental benefits globally, in particular for SMEs in emerging economies, would be significant. Such a platform would also include the de-risking of the business process, the improved provision of trade finance and insurance, the creation of new jobs, increased cargo security, reduced fraud and tax evasion, including VAT, expedited disaster relief responses and increased post-harvest yield and strengthened contaminated food containment. This would offer increased buying power in middle and lower-income countries, which could then buy our high-value goods and services.

I have been briefed on the technology of the public/private partnership Global Coalition of Efficient Logistics, GCEL, which has already been proved in practice. The first pilot test involving complex supply chains was across the US/Canada border, one of the world’s busiest land borders. The first benchmark trade lane is in the process of being deployed between China, Japan and Indonesia, at the request of their Governments. In addition, Asia-Pacific Economic Cooperation leaders have recently signed a memorandum of understanding for GCEL to digitise the operation of ports throughout the APEC region.

This trade digital economy platform technology could be an additional way to cement relationships within the Commonwealth and pan-Africa. The upcoming CHOGM, which we all look forward to—we wish the Government the best and welcome all our friends from around the world—could afford an opportunity for the UK to introduce a pioneering initiative of substance as a partner nation. I have no doubt that many small nations would take an interest.

Being innovative and achieving more with less is key to strengthening the UK’s position in tomorrow’s world. The UK is enviably well placed to spearhead and pioneer global development of the new digital economy, with our core skills and qualities of IT, innovation, finance, insurance, an educated workforce, a stable population, and the rule of law. However, we need to get a move on in readiness for the challenges and opportunities that will shortly be upon us.

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Commonwealth Heads of Government Meeting 2018

22nd March 2018 – Contribution by Lord Waverley 

My Lords, I congratulate the noble Lord, Lord Geidt, on his maiden speech; I was delighted to have the commitment to the Commonwealth of his Royal Highness the Prince of Wales reaffirmed.

I was particularly struck by the remark of the noble Lord, Lord Howell, on the harnessing of civil society. What occurs to me is that, while heads and Ministers are important, it is the people’s Commonwealth on which we should be focusing. How appropriate it is that the emphasis on civil society should be at the CHOGM hosted here in London.

This year’s theme of a common future and role for the Commonwealth in a more prosperous, sustainable, secure and fair future is also integral to Britain’s outlook of reshaping relations in the changing international environment by strengthening diplomatic, trade, defence and security ties. We have heard from the Minister that the final communiqué will reflect the continuing promotion of a more prosperous, sustainable, secure and fair future—a common future, a vibrant future, shaping the Commonwealth’s purpose into the 21st century. Promotion of economic and social development, a broad ability to assist in building capacity for democracy and human rights, economic development and governance by focusing on strengthening national capabilities are central.

Commonwealth membership also remains attractive because the community provides an important trade network. Although not a formal trading bloc, the network provides access to established economies such as Australia, Canada and New Zealand, but also emerging markets such as India and Malaysia. The Commonwealth also reaches into international organisations such as ASEAN, the African Union, the Caribbean Community and the Pacific Islands Forum. I take on board fully the remarks of the noble Lord, Lord Anderson, about the regions of the Commonwealth not necessarily being able to be relied on as a replacement for the European Union. Appropriate care should be taken in that regard.

The overnight news that 44 countries in Africa have agreed a deal for a continental free trade area is welcome. However, I can see this presenting challenges and opportunities for the future. I was delighted that the noble Lord, Lord Anderson, made mention of my friend and mentor, Chief Emeka Anyaoku, a past, effective Secretary-General of the Commonwealth. I have a sneaking regard for the just-announced initiative in respect of Africa beyond the strengthening of internal continental trade. Trade relies on good transport links, so I hope that there will be progress in the development of east/west links rather than the current north/south Paris-London necessities.

Trade between Commonwealth states is estimated at more than $680 billion, and intra-Commonwealth trade is projected to surpass $1 trillion by 2020. According to the Commonwealth Secretariat, when both partners are Commonwealth members, they trade 20% more, pay 19% less and generate 10% more foreign direct investment inflows. This “Commonwealth effect” shows that membership contributes positively to increased trade, investment and labour flows.

Commonwealth members’ trade relationship with the UK has for decades been governed through EU policies. Brexit means that Commonwealth members’ trade relations with the UK are at a crossroads. There is huge potential to capitalise on new trade and investment opportunities with Commonwealth nations. There needs to be a focus on achieving improved trade logistics, simplifying tariffs and other barriers to trade, and developing regional supply chains where Commonwealth countries have existing advantages. There is huge scope to improve this and it should be a prime focus.

However, we need to encourage new sets of players to take an active role. Yesterday, for example, I had the opportunity to call into the Paris-based International Chamber of Commerce’s offices here in London to discuss a wide range of issues beyond just that of the Commonwealth. We determined that it had never been more important to stand together than in these challenging political times to create a conducive business environment that facilitates trade, job growth and prosperity. SMEs in particular depend on this to be able to grow. Such an environment will be dependent on harmonising regulations, reducing non-tariff barriers and improving access to the digital economy. Digital trade enables more entrepreneurs and businesses to trade, particularly SMEs, in emerging markets. It helps remove unnecessary red tape, increase financial inclusion, tackle corruption, connect rural communities to global consumers and increase the number of women in business. I can envisage a clear central role for the International Chamber of Commerce in bridging the gap between the private sectors and global policymakers.

We can also look forward to the Commonwealth Business Forum. All in all, much will come from these initiatives. While it is for the private sector to come together, too much is sometimes expected from government. However, its role is to underpin opportunity by providing export finance facilities and the like.

For my own part, and it is appropriately declared, my humble contribution is that of creating, a platform to promote, connect and facilitate global trade. However, in recognition of this upcoming CHOGM, I am launching, which will coincide with identifying opportunity and connecting particularly SMEs around the Commonwealth.

Although we can hold our head high and be proud of the shared association with countries around the world, it places a burden of responsibility on us. We do pull our weight; much of our contribution is unsung, but we—the family—face common modern-day challenges: climate change, new cross-border security threats and threats to our shared values. The Commonwealth should ensure that the organisation remains responsive to these to retain relevance, vibrancy and effectiveness. Our country’s mantra should be: what is good for our friends is what is good for us.

Mr Arnold Smith, the first Secretary-General of the Commonwealth, possibly had in mind our common values, friendship and understanding when he remarked:

“100 years from now, I suggest, historians will consider the Commonwealth the greatest of all Britain’s contributions to man’s social and political history”.

It was Her Majesty the Queen, however, who stirred the imaginations of us all when she noted that,

“what we share through being members of the Commonwealth is more important and worthy of protection than perhaps at any other time in the Commonwealth’s existence. We are guardians of a precious flame, and it is our duty not only to keep it burning brightly but to keep it replenished for the decades ahead”.

These words should be remembered this time forth.

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